Kickback Scheme Alleged for Kodak Exec

A tax accountant for Eastman Kodak Co. faces charges of money laundering and mail fraud stemming from a kickback scheme that allegedly cost the company more than $4 million.Director of state and local taxes Mark S. Camarata was accused in U.S. District Court in Rochester, New York, of authorizing...

By Stephen Taub • May 10, 2005

Finite-Insurance Subpoenas for Two Companies

General Electric Co. announced that it has received a subpoena from the Securities and Exchange Commission seeking documents related to “certain loss mitigation insurance products.” The subpoena is general in nature, stated GE, adding that it will cooperate fully with the commission.According to ...

By Stephen Taub • May 4, 2005

Purcell Stays; Morgan Stanley to Declassify

It looks like Philip Purcell will remain chairman and chief executive of Morgan Stanley after its board of directors decided not to make any management changes.The board did institute a number of corporate governance changes, however, that ultimately will make it easier for unhappy shareholders t...

By Stephen Taub • May 3, 2005

KPMG Fires Three over Tax Shelters

KPMG LLP fired a senior executive and two partners in moves tied to the scrutiny the Big Four firm is facing concerning its tax-shelter business, according to The Wall Street Journal. The senior executive is Richard Smith, a partner since 1995 and head of the firm’s tax-services division since 20...

By Stephen Taub • May 2, 2005

Putting Property First

In mergers and acquisitions, real estate has typically been an afterthought. Recently, though, property has taken center stage. Consider the current plans for a $6.6 billion private-equity buyout of Toys “R” Us. “We became interested in Toys “R” Us principally because it has lots and lots of terr...

By Don Durfee • May 1, 2005

In Your Own Defense

You aren’t paranoid. There really is a target on your back that says “Sue Me.” A recent study by PricewaterhouseCoopers LLP concludes that 203 private securities class-action lawsuits were filed against U.S. companies and their directors and officers in 2004 — a 16 percent increase over 2003. In ...

By Lori Calabro • May 1, 2005

Feeling the Pain

Bob Ross used to love his job as controller of clothing and housewares retailer Urban Outfitters. Today, he says, “I have no passion for this at all. If something doesn’t change soon, I’ll have to throw in the towel.”Ross says he now spends his days “documenting countless procedures and processes...

By Tim Reason • May 1, 2005

Supremes Could Upend Andersen Conviction

A number of Supreme Court justices reportedly suggested yesterday that they might not have agreed with the Justice Department’s case leading to the conviction of Arthur Andersen, the erstwhile accounting firm, for shredding Enron Corp. documents. While hearing arguments in Andersen’s appeal, Just...

By Stephen Taub • April 29, 2005

Did Wal-Mart Fire a Whistleblower?

A former Wal-Mart vice president who claims he was fired after reporting questionable payments requested by the company’s former vice chairman has asked federal prosecutors to investigate whether he should have been protected as a corporate whistleblower, according to The Wall Street Journal. Jar...

By Stephen Taub • April 29, 2005

Kozlowski Declares His Innocence

After three years of silence, former Tyco International Ltd. chief executive officer L. Dennis Kozlowski took the stand in a Manhattan courthouse and declared that he was innocent of charges that he stole from the conglomerate that he once ran.Kozlowski and former CFO Mark H. Swartz are accused o...

By Stephen Taub • April 28, 2005

Managing the Risk Manager

CFOs should look very closely at their corporate insurance buyers — and at how hard-nosed they are when it comes to negotiating cheaper, better-quality coverage — if the evidence heard at last week’s yearly conclave of risk managers is any indication.Risk managers like to portray themselves as sk...

By David Katz • April 28, 2005

The Ultimate Calling Plan

While SBC’s $16 billion acquisition of AT&T guarantees that 2005 will be a landmark year in telecom history, the more momentous development may prove to be the broad acceptance of Internet-based phone service. M&A activity has reached the point where no deal is truly shocking, even one th...

By Russ Banham • April 27, 2005

Two Sentenced in Enron Barge Deal

Two former Merrill Lynch & Co. executives involved in a sham transaction with Enron Corp. were sentenced Thursday, according to published reports.Daniel Bayly, who was head of investment banking, received 30 months in prison plus six months of supervised release, according to Bloomberg. James...

By Dave Cook and Stephen Taub • April 22, 2005

Outback CFO Resigns; Fires Parting Shot

Outback Steakhouse Inc. chief financial officer Robert Merritt announced his retirement during an earnings call on Thursday, blaming his departure on “recent lunacy over lease accounting, according to the Associated Press.Merritt pointed out that more than 150 companies have recently restated the...

By Stephen Taub • April 22, 2005

Coke Probes Completed by SEC, DoJ

The Coca-Cola Co. announced that it has reached a settlement with the Securities and Exchange Commission relating to its failure to disclose certain end-of-quarter sales practices used to meet earnings expectations at its Japanese unit.Separately, the Atlanta-based soft-drink giant announced that...

By Stephen Taub • April 19, 2005

Raytheon Offers Up CFO to SEC

Raytheon Co. announced that it placed chief financial officer Edward S. Plinef and an unnamed non-executive on leave as part of a proposed settlement with the Securities and Exchange Commission. Raytheon named vice president and controller Biggs C. Porter as acting CFO.The defense contractor, whi...

By Stephen Taub • April 18, 2005

Enron Broadband Trial Begins

Jury selection begins today for five former employees of Enron Broadband Services (EBS). Two of them are former finance executives, and another was a finance executive earlier in his career; none of the names are likely to be familiar.While Kenneth Lay, Jeffrey Skilling, and former Enron Corp. ch...

By Stephen Taub and Dave Cook • April 18, 2005

Stronger Challenges to Plurality Rule

Shareholders seem to think that nominated directors should receive a majority of votes cast in order to get the job.In this proxy season’s first two such resolutions — both of them nonbinding — 38 percent of Caterpillar shareholders and 48 percent of Gannett shareholders voted for those measures....

By Stephen Taub • April 18, 2005

Big Buyback Ends Kerr-McGee Proxy Fight

Kerr-McGee Corp. announced that it will buy back $4 billion of stock as part of an agreement to end a proxy fight with Carl Icahn and activist hedge fund JANA Partners LLC. The company also agreed to cut its dividend and sell some “shorter-life properties” in the Gulf of Mexico, the United States...

By Stephen Taub • April 15, 2005

Good Week/Bad Week: What’s the Frequency, Kenneth?

Disclaimer: While the entries in GW/BW are based on actual news items, some of the people, quotes, and hat sizes in this article are fictional. Other stuff I just plain made up.Please, no lawsuits.GOOD WEEK:1. Kenneth LayIn a filing Wednesday, attorneys for the Enron founder argued against the su...

By John Goff • April 15, 2005

Finite Insurance: Beyond the Scandals

Not very long ago, the use of finite insurance looked much better than it looks today.For years before the current scandals at American International Group Inc., the arrangements were touted as a sleek way for a corporation to control its risk funding and shed liabilities from its balance sheet. ...

By David Katz • April 14, 2005

What’s Next for Section 404?

Will Section 404 be scaled back?Two of the most powerful securities regulators seemed to hint as much at yesterday’s Securities and Exchange Commission roundtable, which discussed the demands of that Sarbanes-Oxley provision calling for companies to document their internal controls over financial...

By Stephen Taub • April 14, 2005

Specialists Charged with Illegal Trading

Federal authorities indicted 15 New York Stock Exchange specialists for using their inside positions to illegally earn about $20 million for themselves, reported the Associated Press.U.S. Attorney David Kelley asserted at a press conference that the 15 specialists at five firms cheated the market...

By Stephen Taub • April 13, 2005

Greenberg Shifts $2.2B of Shares to Wife

Former American International Group Inc. chairman and chief executive officer Maurice “Hank” Greenberg transferred ownership of 41.4 million shares of the insurance company to his wife, Corinne P. Greenberg, according to a regulatory filing.The transfer, made four days before Greenberg’s ouster a...

By Stephen Taub • April 13, 2005

SEC’s Goldschmid Revives Proxy Access

Harvey Goldschmid, one of the SEC’s two Democratic commissioners, seems determined that the Securities and Exchange Commission pass some form of proxy access rule before he steps down later this year.During a speech yesterday to the Council of Institutional Investors, according to Dow Jones, Gold...

By Stephen Taub • April 12, 2005