The Causes And Cons Of The Tyco Scandal 2002

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Tyco Scandal 2002
➢ Abstract Tyco International, a company started as research lab eventually became a billion dollar enter-prise through successive financial strategies. In 2002 Tyco came under headlines when it was accused of fraudulent accounting practices. As it turned out, this whole scandal was true the company was ripped off of $600 million by the CEO and CFO. Trials conducted penalized the corrupt and Tyco ended up paying $2.29 billion to its defrauded shareholders.
➢ A brief introduction to scandal:
Tyco International Ltd was founded by Arthur J. Eventually Tyco shifted its focus and entered into the commercial business sector where it targeted the major businesses or industries which
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They used firm’s money for their own personal interests, falsified expense accounts and selling the stocks without informing the investors. The details are given below.

➢ The main players involved in the scandal:
The main players involved in the Tyco scandal 2002 were:
• The former CEO of Tyco Dennis Kozlowski
• The former CFO Mark Swartz
• The former General Counsel Mark Belnick
• The Chairman of Compensation Frank Walsh
• Other high rank Tyco’s officers and lower level employees
They were accused of reaping $170 million from the company and stealing $430 million more by selling Tyco stock without the consent of the investors by artificially inflating the value of that stock.
➢ How were they caught
During the indictment of the CEO and CFO of Tyco, Dennis Kozlowski and Mark Shawrtz, the district attorney labeled the whole scenario as “top executives’ criminal enterprise” which they used as source of spending firm’s money for their own personal

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