01.08.09
SEC Goes Hunting Microsoft Again, Violations Alleged
“Microsoft’s perspective is best reflected by Bob Herbold, Chief Operating Officer, to whom the CFO reports. Bob very sincerely replied, “Bill, everyone is doing it.” My response was that Microsoft is a leader and that others are now seeking to emulate these fraudulent practices they have legitimized. Naturally Bob was not pleased by this perspective and that was our final conversation. A second informal response came when Microsoft asked PR Newswire to stop issuing my press releases.
“Microsoft is PR Newswire’s largest client.”
IN THE WORDS of Yogi Berra, it’s deja vu all over again.
US ‘renews’ Microsoft share probe
The US financial watchdog, the Securities and Exchange Commission (SEC), has reopened an insider trading inquiry into Microsoft, reports say.
This is not the first time that the SEC steps in because of allegations of fraud against Microsoft (the company settled to escape this previous blunder). With Satyam all over the headlines for massive fraud, this sure could get interesting. Might Novell be next? The SEC doesn't spot it and it's already seen as fishy by some. █
Related posts:
- Pyramid 101 (Video)
- Quote of the Day: Speaking of Ponzi/Pyramid Schemes
- Microsoft Blast from the Past: Lawsuits and Fraud
- Microsoft Blast from the Past: Blackmail
- Microsoft Blast from the Past: Lawsuit Comes from Justice Department, Novell Serves as ‘Puppet’
The Mad Hatter said,
January 8, 2009 at 11:25 pm
The SEC has over the last 8 years been somewhat toothless. It will be interesting seeing if anything changes with the change of administration in the US.
That said, I don’t think that Microsoft is the only company doing this. Over the last 20 years I’ve noticed more businesses doing things that are legally questionable, and this seems to be a problem across a wide range of industries. It seems like the chase for profit has corrupted management.
Of course this is only what I see. I know that the businesses in question will claim that they are acting legally, that everything they have done is proper, that they are only trying to protect shareholder equity, however it does not look like this to me.
AlexH said,
January 9, 2009 at 3:35 am
@Mad Hatter: in cases like this, which is insider dealing perpetrated by individuals, the SEC have generally had a decent track record.
Institutional – and particularly multi-national – problems they’ve found harder, but then, they have a much better record than practically any other agency on earth because they reward tattle-tales with lenient treatment. See, for example, Enron, Virgin vs. BA, or any other numerous “big” frauds.
Roy Schestowitz said,
January 9, 2009 at 3:41 am
Even a Vice President at Microsoft was recently accused.
Microsoft exec dumped stock prior to Red Ring announcement
Microsoft’s Bach sold more stock before Xbox news
Insider Trading Hasn’t Affect Microsoft Stock – Yet
AlexH said,
January 9, 2009 at 4:00 am
@Roy: well, as your articles state, if he did it deliberately then they will catch him, because he has to register all his trades.
Roy Schestowitz said,
January 9, 2009 at 4:10 am
The SEC was asleep. I wrote about it extensively at the time and also addressed a a question at Bach (last week).
AlexH said,
January 9, 2009 at 4:26 am
Given they were the ones who found it, they were hardly asleep.
What you mean is you wanted them to find him guilty.
Roy Schestowitz said,
January 9, 2009 at 4:43 am
I don’t think he was ever investigated or acquitted. I watched it closely.
AlexH said,
January 9, 2009 at 4:51 am
Difficult to see how you would know if the SEC investigated him or not.
Also, you can’t be acquitted until you’re actually charged with something, and Bach was never charged with insider dealing. Selling shares in the company you work for isn’t automatically insider dealing.
Roy Schestowitz said,
January 9, 2009 at 4:53 am
Read the articles again, please.
AlexH said,
January 9, 2009 at 4:56 am
I’ve read the articles already, thanks. If you have a point, make it.