* Waste Management Scandals (1998) * #DeleteUBER * WorldCom Scandal (2002) * Health Scandals (2003

1. Presentation on Analyzing
Business Law Cases
Course Code : Business law
Course Title : Law 2113

2. Waste Management Scandals (1998)
#DeleteUBER
WorldCom Scandal (2002)
Health Scandals (2003)

3.  Company : Houston- based publicly traded waste management company
 What Happened : Reported $1.7 billion in fake earnings.
 Who is to blame :
1) Founder/CEO/Chairman Dean L.Buntrock
& other top executives.
2) Arthur Anderson Company (auditor)

4.  How they did it : The company allegedly falsely increased the depreciation time length for
their property, plant & equipment on the balance sheet
 How they got caught : A new CEO & management team went through the books.
 Penalties : Settled a shareholder class-action suit for $457 million.
SEC fined Arthur Andersen $7 million.

5.  Fun Fact : After the scandal, new CEO A.Maurice Meyers set up an
anonymous company hotline where employees could report dishonest or
improper behavior.

6.  Company : Uber Technologies Inc.
 What happened : after the uber transport company got popular, they are started to increase
their prices. Then the drivers misbehaves with customers. Some customer also faced sexual
harassment. Because of this reason they lost 200,000 customers in just one weekend.
 Who is to blame : drivers are the responsible for these actions.

7.  How they did it: They misbehave with customers
 How did it exposed : the customer started to complain & by this way, they got exposed.
 Penalties : CEO Travis Kalanick resigned, other top executives were forced out, & some
employees are filed for bad behavior.

8.  Fun fact : as a result, the popularity of uber was discreased. That’s why
they started to give discounts

9.  Company : Telecommunication Company; now MCI, Inc.
 What happened : Inflated assets by as much as $11 billion, leading to 30,000 lost jobs & $180
billion in losses for investors.
 Who is to Blame :
1) CEO Bernie Ebbers
2) CFO Scott Sullivan
3) Controller David Myers

10.  How they did it : Underreported line costs by capitalizing rather than expensing & inflated
revenues with fake accounting entries
 How they got caught : WorldCom’s internal auditing department uncovered $3.8 billion of
fraud.
 Penalties : CFO was fired, controller resigned, later sentenced for prison.
The company filed for bankruptcy. Ebbers sentenced to 25
years for fraud, conspiracy & filing false documents with regulations,

11.  Fun Fact : Within weeks of the scandal, Congress passed the Sarbanes-Oxley Act,
introducing the most sweeping set of new business regulations since the 1930s.
Opinion

12.  Company : Largest publicly traded health care company in the U.S
 What happened : earning numbers were allegedly inflated $1.4 billion to
meet stockholder expectations.
 Who is to blame : CEO Richard Scrushy

13.  How he did it : Allegedly told underlings to make up numbers & transactions from 1996-2003
 How he got caught : Sold $75 million in stock a day before the company posted a huge loss,
triggering SEC suspicious.
 Penalties : Scrushy was acquitted of all 36 counts of accounting fraud
but convicted of bribing the governor of Alabama, leading to a
7-years prison sentence.

14.  Fun fact : Scrushy now works as a motivational speaker & maintain his
innocence.
Opinion

15. Any
QUESTIONS ???