culture, politics, commentary, criticism

Friday, February 07, 2003
Arthur Andersen wasn't the problem. The indicted and crippled accounting firm (and two-word all-purpose punch line) Arthur Andersen turns out to be not the purveyor of a one-off con game, but a small part of a pervasive corruption of the accounting industry that is yet coming to light (
New York Times):
Some wealthy Americans who paid millions in fees to two of the Big Four accounting firms to set up tax shelters are suing the firms after the Internal Revenue Service denied the tax savings that they had been promised.

Although only a few lawsuits have been filed, tax experts and lawyers handling these cases said they expected a flood of similar cases as the I.R.S. stepped up its hunt for tax cheating by hundreds and perhaps thousands of executives, business owners, athletes and entertainers with big incomes.

Two firms being sued, Ernst & Young and KPMG, offered shelters that they said would make taxes on salaries, stock option profits and capital gains from the sale of a business either shrink to pennies on the dollar or disappear.

The fees and savings on taxes can be enormous. Ernst & Young charged some clients $1 million just to hear a sales pitch, according to court papers. And the firms made millions from the sale of each shelter. The shelters allowed accounting firms, their clients and the law firms that blessed the deals to share money that otherwise would have gone to the government.
This is no longer legally justifiable tax avoidance, but industry-wide tax fraud. The sheltered (i.e., stolen) money rightfully belongs to citizens.

The Bush administration's isolation and public crucifixion of Andersen, designed to move the spotlight away from the actual Enron perps who contributed lavishly to several Bush campaigns, also conveniently served to destroy the auditor of Halliburton, whose questionable accounting practices occurred while Dick Cheney was its CEO in the late 1990s. It also managed to avoid any real reform of the accounting industry, thereby prolonging a bearish crisis in the stock markets when more Americans own stock than ever before.

Greatest Hits · Alternatives to First Command Financial Planning · First Command, last resort, Part 3 · Part 2 · Part 1 · Stealing $50K from a widow: Wells Real Estate · Leo Wells, REITs and divine wealth · Sex-crazed Red State teenagers · What I hate: a manifesto · Spawn of Darleen Druyun · All-American high school sex party · Why is Ken Lay smiling? · Poppy's Enron birthday party · The Saudi money laundry and the president's uncle · The sentence of Enron's John Forney · The holiness of Neil Bush's marriage · The Silence of Cheney: a poem · South Park Christians · Capitalist against Bush: Warren Buffett · Fastow childen vs. Enron children · Give your prescription money to your old boss · Neil Bush, hard-working matchmaker · Republicans against fetuses and pregnant women · Emboldened Ken Lay · Faith-based jails · Please die for me so I can skip your funeral · A brief illustrated history of the Republican Party · Nancy Victory · Soldiers become accountants · Beware the Merrill Lynch mob · Darleen Druyun's $5.7 billion surprise · First responder funding · Hoovering the country · First Command fifty percent load · Ken Lay and the Atkins diet · Halliburton WMD · Leave no CEO behind · August in Crawford · Elaine Pagels · Profitable slave labor at Halliburton · Tom Hanks + Mujahideen · Sharon & Neilsie Bush · One weekend a month, or eternity · Is the US pumping Iraqi oil to Kuwait? · Cheney's war · Seth Glickenhaus: Capitalist against Bush · Martha's blow job · Mark Belnick: Tyco Catholic nut · Cheney's deferred Halliburton compensation · Jeb sucks sugar cane · Poindexter & LifeLog · American Family Association panic · Riley Bechtel and the crony economy · The Book of Sharon (Bush) · The Art of Enron · Plunder convention · Waiting in Kuwait: Jay Garner · What's an Army private worth? · Barbara Bodine, Queen of Baghdad · Sneaky bastards at Halliburton · Golf course and barbecue military strategy · Enron at large · Recent astroturf · Cracker Chic 2 · No business like war business · Big Brother · Martha Stewart vs. Thomas White · Roger Kimball, disappointed Republican poetry fan · Cheney, Lay, Afghanistan · Terry Lynn Barton, crimes of burning · Feasting at the Cheney trough · Who would Jesus indict? · Return of the Carlyle Group · Duct tape is for little people · GOP and bad medicine · Sears Tower vs Mt Rushmore · Scared Christians · Crooked playing field · John O'Neill: The man who knew · Back to the top

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