101 dumbest moments in business: Corporate scandals
The year in shenanigans, skulduggery, and just plain stupidity.
By Adam Horowitz, David Jacobson, Mark Lasswell, and Owen Thomas
2. Investment bank error in your favor. Collect an additional $1.43 billion.
The judge in billionaire Ronald Perelman's lawsuit against Morgan Stanley, exasperated by the latter's delays in handing over documents, instructs jurors to assume that the firm committed fraud. The bank insists it isn't stonewalling, just running into technology glitches. The jury awards Perelman, who had sued Morgan over its role in his sale of Coleman to Sunbeam for stock that became worthless after an accounting scandal led to bankruptcy, $1.45 billion in damages. Perelman had reportedly offered to settle for $20 million.

9. After stealing $50 million, what's a few papers between friends?
Facing charges alleging that he looted his company of tens of millions of dollars, disgraced ex-CEO Conrad Black returns to Hollinger headquarters in Toronto and makes off with several cartons of files from his former office. A security camera captures the escapade on tape. Faced with a contempt-of-court charge, Black returns the files to Hollinger.

27. Enron? Those guys were lame. We did the same thing, but it only took us two months.
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In August, commodities brokerage Refco debuts on the New York Stock Exchange. Its stock rises 25 percent the first day. Nine weeks later, on Oct. 10, the company discloses that CEO Phillip Bennett had hidden $430 million in debt from its books. On Oct. 12, Bennett is arrested for securities fraud. On Oct. 13, trading in Refco is halted. On Oct. 17 the firm files for bankruptcy and starts selling off assets.

28. For speed, Refco's got you beat. But in terms of creativity ...
In September, two months after Connecticut-based hedge-fund firm Bayou Management closed its doors but assured investors that their money would be returned, founder Sam Israel III and CFO Daniel Marino plead guilty to fraud and conspiracy charges. SEC investigators say Bayou had burned through $300 million of the $450 million it had taken in since its founding in 1996, had siphoned off tens of millions by funneling trades through its own securities firm, and had even set up a sham accountancy to issue fake audits attesting to its phony results. Israel and Marino each face up to 30 years in prison.

Next: 101 Dumbest Moments in Business: Full list >>

From the February 1, 2006 issue

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Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer LIBOR Warning: Neither BBA Enterprises Limited, nor the BBA LIBOR Contributor Banks, nor Reuters, can be held liable for any irregularity or inaccuracy of BBA LIBOR. Disclaimer. Morningstar: © 2013 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2013 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2013. All rights reserved. Most stock quote data provided by BATS.
© 2013 Cable News Network. A Time Warner Company. All Rights Reserved. Terms under which this service is provided to you. Privacy Policy. Ad choices .