The Seven Most Crooked CEOs of All Time
You might read this list and argue that I left out someone who was really, really crooked. I tried to include the CEOs who directly or indirectly defrauded the investing public out of the most money, made the most amount of news and were sentenced to the longest amounts of jail time. These men were all the CEOs of high profile companies, and all in but one case, are either dead or still in jail. Here is the list, in no particular order:
1. Bernard Madoff.
Company: Bernard L. Madoff Securities
How can you have any list like this without including Bernard Madoff, who was behind the biggest fraud ever perpetrated on the investing public? The exact size of the fraud is still unknown, but one thing is for certain - Madoff successfully bilked billions of dollars from investors over a number of decades, and successfully evaded the SEC on multiple occasions in the process. Some have as much as $65 billion dollars being lost in the scheme, while other estimates have the losses pegged at between $13-$21 billion dollars.
Madoff founded Bernard L. Madoff Securities in 1960, and was Chairman of the company until his scheme unraveled in 2008.
Madoff is currently serving out a 150 prison sentence and was ordered to pay back some $170 billion dollars in restitution.
2. Kenneth Lay.
Guilty of: overseeing one of the greatest frauds in the history of the stock market. Enron was propelled to great heights through aggressive, egregious and well-planned accounting fraud. Tens of thousands of Enron employees lost their entire net worth when the stock took a swan dive, and investors in the company lost billions. Kenneth Lay was "eager" to tell his side of the story and then did an about-face, taking the Fifth in his Congressional testimony.
Lay was indicted by a grand jury in Houston, Texas, and charged with 11 counts of securities fraud, wire fraud and making false and misleading statements. Lay ended up being found guilty of ten different counts of conspiracy and fraud charges.
Where is he Now: Dead. Approximately three and a half months before being sentenced, Kenneth Lay died while vacationing in Colorado. His conviction ended up being vacated.
3. Barry Minkow.
Company: ZZZZ Best
Guilty of: using his "ZZZZ Best" company as a glorified Ponzi scheme. This swindle involved all of the following elements: phony restoration contracts. Mob money. Phony press releases. Million dollar mansions. The company, which was built on smoke and mirrors, actually ended up going public and giving Minkow a temporary net worth of over a hundred million dollars. Eventually people started asking questions and the company collapsed within weeks. Minkow was extremely young, having started the company when he was just 16 years old. The collapse of his company took place when Minkow was the ripe old age of 20 years old.
Minkow's home and businesses were raided, and he was eventually convicted of fraud and sentenced to 25 years in prison. He ended up serving just seven years of his sentence.
Where is he Now: Is a senior pastor of the Community Bible Church in San Diego. Found God while serving time in prison. Lectures on fraud prevention.
4. Bernard Ebbers.
Guilty of: was CEO during a three year period in which the company used fraudulent methods to cover up their deteriorating business. It was later revealed that the company had under-reported certain costs and inflated revenues in order to appear stronger than they actually were. In 2003 it was revealed that the company's total assets had been inflated by $11 billion dollars.
Was convicted of nine charges on March 15th, 2005, and was eventually sentenced to 25 years in jail.
Where is he Now: Certainly serving time at the Oakdale Federal Correctional Institution in Oakdale, Louisana. Eligible for parole in July of 2028.
5. David Walsh.
Company: Bre-X Minerals Ltd.
Guilty of: while always protesting his innocence, Walsh founded and was CEO of the company that perpetrated one of the biggest frauds on the investing public EVER. Bre-X was a junior mining company based out of Calgary that was at one time worth billions of dollars. This lofty valuation was completely unjustified though as company employees had "salted" a mining site based in Busang, Indonesia in order to give the appearance that the site contained a phenomenal amount of gold. Some estimated that the site could contain as much as 200 million ounces of gold. Many investors piled in, and eventually the entire company was exposed as being a fraud. Billions were lost, lawsuits were filed, and Walsh fled to the Bahamas.
Where is he Now: Dead. Walsh died of a brain aneurysm in June of 1998.
6. Calisto Tanzi.
Guilty of: Embezzled eight hundred millions euros from the company that he ran and founded. Signed off on accounting deceptions that allowed the company to try and cover up billions of dollars worth of losses.
Tanzi was eventually arrested for financial fraud and money laundering, and one of the greatest financial scandals in the history of Italy was now underway. Tanzi admitted during questioning that he had diverted funds out of Parmalat and into other ventures.
Where is he Now: Currently serving time in a Milan prison.
7. Dennis Kozlowski.
Guilty of: misappropriating company funds. Along with former CFO Mark Swartz, was accused of stealing $600 million dollars from the company. This money was used to fund a lavish lifestyle which included $6,000 shower curtains and million dollar birthday bashes for his wife. Was eventually convicted on June 17th, 2005 for a multitude of different charges, including fraud and grand larceny. Was sentenced to serve no less than eight years and four months and a maximum of 25 years in prison for his role in the scandal.
Where is he now: Currently serving time in prison.
Filed under: Stock Market Scandals