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TYCO SCANDAL SHOCKS THE FINANCIAL WORLD
The financial world is shocked to learn that a popular security company, Tyco, pulled off an epic scandal. The large, New Jersey based company was busted for the scandal just recently. The companies CEO Dennis Kozlowski and CFO Mark Swartz stole $150 million and inflated the company's income by $500 million. They accomplished this by getting money from unapproved loans and fraudulent stock sales. They also smuggled money out of the company, disguising it as bonus' and employee benefits.
HOW THEY GOT CAUGHT
Investigations by SEC and Manhattan D.A uncovered many suspicious accounting practices. Among these was a series of loans to Kozlowski that were never forgiven.
LAYING DOWN THE LAW
A judge found the two guilty of many charges and sentenced the men to 8-25 years in prison and forced Tyco to pay back $2.92 in loans to investors.
Fun Facts
1. At the height of the scandal, Mr. Kozlowski threw a $2 million dollar birthday party for his wife on an island, and Jimmy Buffet performed.
2. October 7th, 2003 was the date of the first trial for the Tyco frauds.
3. Two years later on June 17th, 2005 the jury finds the men guilty and they are sentenced to jail time.