25 Biggest Corporate Scandals Ever

Posted by , Updated on October 29, 2018

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Corporate scandals, whether centered around corruption, bribery, fraud, or other kinds of greed, have a significant impact on the economy as a whole. After all, trust and credit play a substantial role in any economy. Once you remove honesty, the whole stack of cards can come tumbling down. Of course, while some companies can make a comeback after a scandal, many others go down with the ship and file for bankruptcy. As we peel back the covers of financial greed, here is a list of the 25 Biggest Corporate Scandals Ever.
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20

Arthur Andersen

arthur andersen

Speaking of Arthur Andersen, this Chicago-based company voluntarily relinquished its licenses to practice as Certified Public Accountants (CPAs) in the USA due to the Enron accounting scandal. This was a blow, considering that it was one of the world’s top five accounting firms prior to the scandal. It resulted in the loss of 85,000 jobs and corporate re-branding.

19

Bear Stearns Companies Inc.

bear stearns

This is one of the US’s biggest government bailouts that helped avoid a domino effect of financial market failures. Ranking as one of the largest global investment banks, securities-trading and brokerage firms in the world, Bear Sterns was nearly bankrupted before it sold itself to JP Morgan Chase for $2 a share or $240 million. This was furthered bolstered by a guarantee of $30 billion worth of loans given by the Federal Reserve to the company.

18

Swissair

swissair

Swissair, a former national airline of Switzerland and a major international airline, was grounded in October 2001 due to a bad expansion move. With 30% of its shares in stocks owned by the Swiss government, the company implemented the Hunter Strategy, a major expansion program. However, this resulted in a financial crisis that also effected its parent company, SAirGroup, which was already hurt by the September 11 attacks. As the entire Swissair fleet was grounded and officially dismantled in March 2002, it was later acquired by Crossair and the liquidation firm Jurg Hoss.

17

Parmalat

parmalat

Parmalat, an Italian company, is the leading global producer of Ultra Hot Temperature (UHT) milk and other foods. However, its founder, Calisto Tanzi, was accused of questionable accounting practices in 2003 when a €14 billion hole was discovered in the company’s accounting records. This resulted in one of the biggest corporate scandals in history. It turns out he was selling credit-linked notes to the company and diverting the company’s funds elsewhere.

16

BANINTER

Baninter

Banco Intercontinental, or BANINTER, was the second-largest privately held commercial bank in the Dominican Republic. Its demise resulted from political corruption in 2003 as fraudulent bookkeeping and political influence by all the major Dominican political parties resulted in a $2.2 billion deficit, which was equal to 12 to 15% of the country’s GDP.

SEE ALSO: 25 Biggest Corporate Scandals Ever »

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