More Cheney Shenanigans
Dick Cheney: Know-nothing CEO
By Bradford Plummer
This week, BusinessWeek flays Dick Cheney for his "see no evil" defense of his tenure as Halliburton's CEO. In 1998, Cheney's company used a few accounting gimmicks to boost its stated profits -- without telling investors. Recently, the SEC ruled that Cheney couldn't possibly have known about the maneuvers. BusinessWeek wonders how dumb the SEC thinks we are:
The second-most important political executive in our country claims to be ignorant of one of the key business decisions his company made during his tenure as CEO. It may well be that an underling was willing to make such an important call without telling Cheney, but make no mistake: This type of scenario would be very rare, even in pre-Sarbanes-Oxley Corporate America.
Even if Cheney didn't know about the disclosure decision, he should have. CEOs are paid big bucks for a reason: To stay on top of the important events going on in their companies. When it comes to maneuvers that have such a critical -- and obvious -- impact on earnings, ignorance is no excuse.
Alas, according to the law, ignorance is still an excuse. Remember, after the big corporate scandals, then-Treasury Secretary Paul O'Neill pushed for laws that would punish CEOs for "negligence" on these sorts of accounting issues. (Even under Sarbanes-Oxley, CEOs are only punished for "knowingly falsifying" the records.) But some in the administration thought O'Neill's idea too harsh. I wonder if Dick Cheney was one of those voices?
- Bradford Plumer
By Bradford Plummer
This week, BusinessWeek flays Dick Cheney for his "see no evil" defense of his tenure as Halliburton's CEO. In 1998, Cheney's company used a few accounting gimmicks to boost its stated profits -- without telling investors. Recently, the SEC ruled that Cheney couldn't possibly have known about the maneuvers. BusinessWeek wonders how dumb the SEC thinks we are:
The second-most important political executive in our country claims to be ignorant of one of the key business decisions his company made during his tenure as CEO. It may well be that an underling was willing to make such an important call without telling Cheney, but make no mistake: This type of scenario would be very rare, even in pre-Sarbanes-Oxley Corporate America.
Even if Cheney didn't know about the disclosure decision, he should have. CEOs are paid big bucks for a reason: To stay on top of the important events going on in their companies. When it comes to maneuvers that have such a critical -- and obvious -- impact on earnings, ignorance is no excuse.
Alas, according to the law, ignorance is still an excuse. Remember, after the big corporate scandals, then-Treasury Secretary Paul O'Neill pushed for laws that would punish CEOs for "negligence" on these sorts of accounting issues. (Even under Sarbanes-Oxley, CEOs are only punished for "knowingly falsifying" the records.) But some in the administration thought O'Neill's idea too harsh. I wonder if Dick Cheney was one of those voices?
- Bradford Plumer
posted by BLONDIE at 11:57 AM
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