A few years ago, three people stopped by my mailbox and took some new bank checks I had ordered. By the time I realized what was going on there was a $1,500 charge to my bank account.
My bank covered that. Working with the local sheriff I profiled some people. When they found the girl, she immediately confessed. She said the men had left for Mexico. Released on some kind of bond, the girl took off for Texas.
Returning to the area two years later, the first thing she did was apply for welfare. The problem was that office had her name on a list for skipping bail. She did not need welfare for a while because she received free room and board.
By the American standards of justice, she got what she deserved. She stole someone's money and went to jail. Had that occurred now, she would have a lot of company if her crime had been a federal offense.
Her company would have included Enron officers Jeff Skilling and Ken Lay, had he not died just after his conviction. Another Enron officer convicted was Andrew Fastow.
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Together they stole and destroyed millions of dollars of employee retirement funds and stockholder money. Employees could not sell their Enron stock before five years, but these people were allowed to sell theirs nearly immediately. Of course the value of the stock had been falsified by these three. The company never really made money, but that was not what the publicly released accounting figures said. According to the certification of an outside accounting firm, which is no longer in business, the company was making millions of dollars.
Two other corporate executives recently convicted include Tyco International chief executive L. Dennis Kozlowski and the former chief financial officer Mark Swartz. Kozlowski spent $6,000 on a shower curtain in his $31 million Fifth Avenue Apartment, and $2.2 million on a birthday party for his wife. The problem was that it wasn't his money. It was the stockholders' money.
These people are no different than that girl and her two friends who stole my check blanks. The executives are common thieves just as those who stole from me are.
They, of course, are not the only corporate thieves. New York Attorney General - soon to be governor - Eliot Spitzer now has many convictions of those involved in corporate wrong-doing. Good for him. Capitalism, which has brought America the wealth and power it has, needs people like Spitzer to defend it.
The only thing wrong with the criminal cases so far is they have not gone after the co-conspirators to the degree they should. The co-conspirators include outside auditors, as I mentioned above and, often, the directors of the firms involved. When outside auditors fail to apply basic accounting practices such as verifying income and checking expenses, they have failed the stockholders who are really paying them. Of course they are afraid if they are too tough in their application of auditing principles, they will lose the valuable contract with the firm they are auditing.
As for the directors, they too have to certify that both internal and outside auditing meet accounting principles. It is also their responsibility to see that corporate remuneration is within standard and legal parameters. There is a limit to what any corporate officer should be paid, and that limit has too often and knowingly been exceeded. Most major corporations pay absurd amounts to top officers. The amounts exceed what the market would require.
The reason this occurs so often is that these directors are also either officers of the very corporation they are supposed to be watching over, or they are officers of another corporation and they use what is happening in the corporation they are a director of to justify their own company paying them at the same level.
Until corporate executives and directors again start doing the job they are supposed to be doing, we will see more and more of them heading to jail. It gives me some sense of satisfaction to see this happening, whether those being incarcerated are mail box thieves, or corporate thieves. They are all the same.
