ZERO PLUS 1061 DAYS, New York, NY, August 6, 2004--Corporate
Terror Hunting seems to be the hallmark of 21st Century business
battles. It seems that the biggest corporate news striking the
headlines is which company did the worst, most egregious acts
against the public and its stockholders.
If corporations are
like Humpty Dumpty, they are falling from the wall and their
former inviolable shells are cracking right and left.
more bloodshed as corporations cling to their own non-vigilant
One of the big Corporate
Terror Hunters is the law firm of Scott & Scott in Colchester,
Conn., that specializes in class-action securities litigation.
In addition to Halliburton, four top executives of the Halliburton
Company have been named in the suit for "cooking the books"
at the expense of stockholders.
The suit was filed the
day the Securities and Exchange Commission settled a civil suit
against Halliburton for using questionable accounting practices
that boosted the company's stock value of $7.5 million.
But the new civil action
by Scott & Scott is only part of the cracks in Halliburton's
corporate shell. In a quarterly filing this Tuesday, Haliburton
disclosed it is under investigation by the Justice Department
over possible over billing on government services work done
in the Balkans from 1996 through 2000. Also, it was disclosed
that Halliburton is under investigation by the Justice Department
and the SEC over a project in Nigeria it participated in where
possible illegal payments may have violated the Foreign Corrupt
Halliburton is a giant
egg on the corporate wall. And, it gets headlines in part because
its former CEO was Dick Cheney during the times it is accused
of major violations. Mr. Cheney is the Vice President of the
Regardless of the reasons
for the headlines, the fact remains that giant corporations
are not exempt from attacks when there is evidence of wrongs
against the public, investors and stockholders.
In response to the lawsuit
by Scott & Scott, Haliburton spokespeople claim that such
Terror Hunting litigation is an excuse to "abuse"
corporations. Halliburton officials said: "They abuse the
broad immunity from defamation actions enjoyed by litigants
and get their publicity at the same time."
& Scott are embroiled in TerrorHunting
In a related story by
James Surowiecki in the August 9 issueof the New Yorker, he
relates a story about corporations hoarding cash. Currently,
corporations have socked away a half a trillion dollars.
He compares the rich
bellies of corporate cash to the meager ones of the average
American. The national savings rate, he reports, is just two
percent and there is more than two trillion dollars in consumer
Microsoft leads the
world in corporate savings. It sits on sixty billion dollars.
And rather than let its cash sit idle, Microsoft announced recently
it will pay a special thirty-two-billion-dollar dividend at
the end of the year.
But, Survowiecki reports,
not all companies look at their pile of cash that way. Like
any source of power, they let it grow under their control, keeping
it out of the economic mainstream where it could be put to work
to spur the economy.
The pile of cash is
like lottery winnings to some companies--there is so much of
it that it is often spent unwisely in acquisitions that look
good at the moment but then tend to fall apart because the rush
to "buy" blinds the CEO who is on a buying spree.
He notes that most economists argue that "if CEO's spend
unwisely it's because they are more interested in empire-building
CEO's spend unwisely it's because they are more interested
in empire-building than value-building." James
Survowiecki August 9, 2004 New Yorker
The losers in excessive
cash hoarding are of course the stockholders and the public.
Dividends that should be paid aren't, and money that should
flow into the economy to fuel the engines of commerce sit in
secure one-percent yield returns where CEO's can watch the money
Corporate Terror Hunting
today is not about destroying the power of capitalism, as some
would like to argue. It's about reestablishing the faith between
the leaders of companies and the public.
In the broader vision
of things, the attacks on Halliburton are signals to other companies
that even though the Vice President of the Untied States might
have once been the head guy of the company, that the Justice
Department, the SEC, and the average Joe and Jane, has the right
That's a big deal.
Corporations used to
have an incredible ability to "terrorize" the public
by putting up their "corporate shields" and daring
anyone to challenge them. They had both political as well as
unlimited economic powers to quash the attacks on their alleged
"integrity," and to act as though they were Titans,
above the law, above the fundamental moral and ethical guidelines
to which most people subscribe.
Joe or Jane wouldn't attempt to refute a corporation
as fierce as a fire-breathing Beast of Terror
The average Joe
or Jane would cower justthinking about trying to refute a corporation,
for its power loomed as fierce as Beast that would breathe fire
and eat your children if you dared to take it on. Corporations
used the Corporate Terror Tactics--Fear, Intimidation and Complacency
to their favor.
But times change.
In Halliburton's case,
four employees launched the class action suit. Many more will
The Joe and Jane who
once shied from seeking justice from the "giant company"
because of the oppression the company presented in terms of
legions of lawyers and tons of money to drag out and wear down
the single individual, have sought support and won. The EEOC
recently supported a group of women who charged sexual bias
against Morgan Stanley and won.
The playing field is
becoming more and more level as individuals learn they can fight
back and win.
When it is all said
and done, when the bodies are counted, there will be a fresh
new order for the corporations. They will, after suffering many
wounds to their former sense of impenetrability, find their
vulnerability to be just as human as those who do not hide behind
the corporate shield. Martha Stewart found that out, even though
her "corporate shield" was her image. She was dethroned,
as the blind CEO's will be dethroned to the Corporate Terror
Hunters who fix them in their sights.
But it will end well.
Corporations will be forced to install Corporate Vigilance Departments,
at first defensively, and then they will evolve into offense
strategic tools. When a Corporation of Vigilance does business
with the public, that trust that is the foundation of all rich
economies, will soar again.
The engines of commerce
like Halliburton are being knocked off their high horses
But for now expect more
bloodshed as corporations continue trying to cling to old ways
and old habits where they fearlessly believe they do not have
to attend to the Principles of Vigilance.
When they are wounded
enough, they will cry out for help. The Beast will fall and
be reborn a Sentinel.
In the interim, if you
are a victim of Corporate Terrorism, fight back. There is no
time like now to assert your rights. Become a Sentinel of Vigilance.
Go To August
3--Parallels Between Corporate & Olympic Terrorism
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