How To REALLY, REALLY Plead Guilty

Frank DiPascali, former CFO for Bernie Madoff, entered a guilty plea to a host of federal charges.  As guilty pleas go, the Barometer finds this plea to be one for the books, “I’m standing here to say that from the early 1990s until December 2008, I helped Bernie Madoff and others carry out a fraud. I knew no trades were happening. I knew what I was doing was criminal. But I did it anyway.”

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“Well, then it’s not cheating, is it? If nobody finds out?”

Indy racer Danica Patrick, in a Sports Illustrated interview with Dan Patrick.  Ms. Patrick was answering Mr. Patrick’s question question on whether she would use performance-enhancing drugs if she could not be caught. Ms. Patrick said she was just joshing.

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“Any time there was a meeting of management, I’d say, ‘Hold your fraud hot-line card up.'”

Richard Scrushy, former CEO of HealthSouth, testifying at civil fraud case on how hard he worked to instill ethics in employees and encourage them to report concerns.  Mr. Scrushy was testifying whilst serving his sentence for a bribery conviction that resulted from a $500,000 donation to the former governor of Alabama’s foundation.  HealthSouth, following Scrushy’s departure, had to issue a restatement of its financials to the tune of nearly $3 billion. 

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The Prosecutors and the Senator: A Credo Would Have Helped

Judge Emmet Sullivan said he had never seen “mishandling and misconduct” like that of the prosecutors in the U.S. v. Stevens case.  The Barometer has no doubt that former Senator Ted Stevens (R. Alaska) crossed a few ethical lines in his relationships with some contractors and others.  However, legal breach is different from ethical breach, and the former requires proof.  In dismissing the conviction, Judge Sullivan appointed a special prosecutor to look into the conduct of the Justice Department prosecutors in their pursuit of a conviction.  The good judge noted that the prosecutors did not disclose exculpatory evidence and that former U.S. Attorney General, Michael Mukasey, ignored letters from defense attorneys outlining the ongoing problems with honest disclosures.

The Barometer encourages students, business people, and professionals to develop their own credos.  A credo consists of things you would never do, lines you would never cross to gt a job, to keep a job, to meet your numbers for the quarter, or to win a case.  The exercise is difficult for most.  “Never?” they counter, “I can’t say ‘Never!'”  Yet, it is possible to draw lines.
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“They don’t know right from wrong.”

On Monday morning, March 16, 2009, the Barometer was sitting in a waiting room with three other women who were also there for the annual face-off with GE torture racks that are gender-specific. Sitting in our pink gowns that open at the front, we are generally a quiet lot. Continue reading

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“You might have crossed a few ethical lines if you plan to dole out $100 million in bonuses whilst on the government dole.”

The Barometer supposes that the fear is palpable, that if you withheld $100 million in bonuses from these crackerjack AIG executives that they would hit the road in response to the job offers at their fingertips. Continue reading

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You might have crossed a few ethical lines if you are a member of the House from New York and claim Maryland residency . . .

Rep. Eliot Engel (D. Bronx) has been elected to the House from the state of New York five times.  During that ten-year span of public service, Mr. Engel and his wife, who have been lifelong residents of the Bronx, listed their primary residence on their tax returns as one located along the Potomac in Maryland. The effect of having the Potomac home as their primary residence was that the state of Maryland gave the couple $7,000 in tax credits (just over the past 4 years).  The credits required:  (1) at least six months residence in Maryland; (2) Maryland driver’s licenses; and (3) Maryland income tax returns.  (2) and (3) were out — the Engels have licenses in New York and file with the state of New York.  (1) we don’t know because Engel had no comment.  The Barometer does.  You might have crossed a few ethical lines if you are an elected representative in one state but claiming residential property credits in another!  Does Turbo Tax have a screen for public figures that offers, “To disregard tax rules and maximize refund, click here”?  

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The Invoice Mistakes

The small business owner realized that one of his vendors had made underbilling errors totaling $10,000.  “Probably no way they would ever catch them — too big, too busy, but me, well, those are big dollars for me!”  To tell or not to tell — there is the question. Continue reading

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“I cannot adequately express how sorry I am for what I have done.”

Bernie Madoff, on entering a guilty plea to 11 counts of securities fraud, mail fraud, investment adviser fraud, wire fraud, flora fraud, fauna fraud, and perjury.  Sir, you said it.

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Jack Welch: The Father of Shareholder Value Admits It Was “The Dumbest Idea in the World”

In an interview with The Financial Times, Jack Welch, the former CEO of GE and the father of shareholder value, said, “On the face of it, shareholder value is the dumbest idea in the world.  Shareholder value is a result, not a strategy… Continue reading

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The New York City Lawyer Who Threw a Case

Daniel L. Bibb, a former assistant district attorney in New York City, told a newspaper last year that he deliberately lost a rehearing on the evidence in the murder convictions of two men for killing a bouncer outside a New York City night club.  Defense lawyers say he gave them evidence and held back on cross-examination.  Mr. Bibb, who believed the convicted men to be innocent, said he threw the case after his superiors could not be persuaded that the men were innocent.  Mr. Bibb also said he could not afford to be out of work and that he did not want the men to remain in prison as he pursued other avenues.  “I know I did the right thing.”  The Barometer is not so sure. Continue reading

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“It has been very successful — very strong. In fact, it’s off-the-charts good.” Stanford L. Kurland, former CEO of Countrywide, now CEO of PennyMac.

PennyMac buys delinquent home mortgages from the federal government for about 38 cents on the dollar and then offers the borrowers mortgages at better terms.  Ironically, Mr. Kurland is buying up mortgages Countrywide originally made.  He has cut interest rates on loans that he buys from 7.25% to 3%.  The homeowners rejoice and “could not care less” what Kurland did before.  “What’s in it for me?” reigns on both ends. 

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“There’s this automatic assumption that if you make money from a drug company, you must be corrupt.”

So said Dr. Richard Grimm, a Minnesota researcher who accepted $798,000 or so from drug companies between 1997 and 2005.  No, Dr. Grimm, no one assumes any such thing.  It’s the disclosure that matters.  Lewis Morris, the general counsel for the inspector general’s office in the Department of Health and Human Services, in announcing upcoming civil and criminal charges against doctors who demand consulting fees from pharmas in exchange for using their products, countered.  “Somehow physicians think they’re different from the rest of us.  But money works on them just like everybody else.”  Called a conflict, you either don’t take the money or you Continue reading

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The Eaves Damage to the U-Haul Truck

A delightful friend rented a truck to help his aunt with her move.  He did not take the insurance coverage for the truck because, as he said, “I know how to drive!”  Safety tip for renting moving trucks:  Your auto insurance probably doesn’t cover you! Continue reading

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