Companies under the klieg lights
Since late last year, a number of major US companies have been accused of financial wrongdoing that has shaken trust in corporate America. Following are some of the more significant disclosures:
Dec. 2, 2001: Enron, once the nation's largest energy trader, becomes the largest-ever US bankruptcy amid a probe of off-the-books partnerships that were allegedly used to hide debt and inflate profits.
Jan. 28, 2002: Global Crossing becomes the largest telecom bankruptcy in US history. The fiber-optics network firm faces SEC and FBI inquiries into its accounting practices after it allegedly engaged in "network capacity swaps" with other telecom firms to inflate revenue.
April 23: Computer Associates International says it has agreed to a $638,000 penalty to settle charges with the Justice Department that it violated premerger rules after announcing it would acquire competitor Platinum Technology International.
May 21: Merrill Lynch agrees to pay $100 million to settle a probe by the New York State attorney general into charges that it tailored stock research to win investment-banking business. In June, it suspended two employees after an internal probe involving the firm ImClone.
May 28: Dynegy's board of directors says it has accepted the resignation of Chuck Watson as chairman and CEO. The company, which tried to merge with Enron, is the target of several federal probes into alleged sham trades to artificially pump up revenue and volume.
June 3: Tyco's chief executive, Dennis Kozlowski, resigns a day before he is indicted for evading about $1 million in sales taxes from art purchases. The company is under investigation into whether executives used corporate cash to buy art and homes.
June 12: Samuel Waksal, former chief executive of ImClone, is arrested on insider-trading charges. Congressional investigators say he tried to unload stock after learning that the Food and Drug Administration would not review ImClone's new cancer drug.
June 15: Three months after the Justice Department charged Arthur Andersen with obstructing justice in the government's investigation of Enron, the accounting firm is found guilty by a federal jury. The judge sets sentencing for Oct. 11. Andersen says it will appeal.
June 25: Adelphia files for bankruptcy. The cable operator is under investigation by the SEC and two federal grand juries for multibillion-dollar off-balance-sheet loans to its founders, the Rigas family. In May, the company estimated it was liable for $3.1 billion in family debts.
June 25: WorldCom Inc. says it hid $3.85 billion in expenses, allowing it to post a net income of $1.38 billion in 2001, instead of a loss. On June 28, the telecommunications company began cutting 17,000 jobs, more than 20 percent of its workforce.
June 28: Xerox says it will restate five years of results to reclassify more than $6 billion in revenues. In April, the company settled charges that it used "accounting tricks" to defraud investors and inflate stock picks.