<Business Recipes for Success>

When I started my Now What, Cat? website, I blogged about almost everything under the sun until I noticed that readers would like me to stick to my original theme, that is humor and about life. The other side of me as a Certified Public Accountant and business consultant desire to write about business and accountancy So I came up with this blog, Business Recipes for Success.

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2.27.2008

Five found guilty in AIG stock inflation scheme

I cannot help but observe that most of the white-collar crimes committed by top executives are in manipulation of financial statements. Just read this news about the conviction of the executives of the largest insurance company.

Excerpt of the news. Read the entire news here.

HARTFORD, Connecticut - Five former insurance company executives were found guilty Monday of a scheme to manipulate the financial statements of the world’s largest insurance company, American International Group Inc.

The defendants, including four former executives including a onetime CEO of General Re Corp., and a former executive of AIG, sat stone-faced as they were convicted of conspiracy, securities fraud, mail fraud and making false statements to the Securities and Exchange Commission.

Prosecutors said they participated in a scheme in which AIG paid Gen Re as part of a secret side agreement to take out reinsurance policies with AIG in 2000 and 2001, propping up its stock price and inflating reserves by $500 million.

Labels: Fraud Charges

2.18.2008

Wall Street role in mortgage meltdown probed

At the height of the real estate boom, I know that somehow is going to burst. Many people I know who do not have the financial capability to pay a mortgage was able to buy a house. In less than a year, they were able to refinance. From the proceeds of the loan and debt restructuring, they paid some of their credit card bills. After the money dried up, they were faced with the problem where to get the money for the amortization which had already gone up.

Is this the reason why probe is conducted by the regulators? Read the excerpt and read the entire news here.

BOSTON - Regulators are trying to punish Wall Street for mortgage finance practices that expanded home ownership and spread risk among a host of new players — but also may have duped borrowers and investors who supplied cash to fuel a housing boom that's turned bust.

A handful of state securities regulators and a couple foreclosure-blighted cities have fired the opening shots with lawsuits trying to prove that investment banks and big lenders are guilty of more than just bad business decisions and failing to foresee looming mortgage troubles. Some regulators say greed and fraud underlie much of the subprime mortgage mess that has spread across the broader housing market, triggering a spike in foreclosures.

Aside from the civil cases, the FBI is looking at possible criminal action, focusing on what Wall Street firms knew about the risks of mortgage securities backed by subprime loans, and whether they hid risks from investors.

Labels: Real Estate

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2.27.2008

Five found guilty in AIG stock inflation scheme

2.18.2008

Wall Street role in mortgage meltdown probed