Cups and Balls

Published: April 14, 2010

By Jim Lichtman
Read More

When Hieronymus Bosch painted The Conjurer, in the 1500s, I’m sure he never imagined that the cups and balls routine he rendered would morph into a variety of schemes, scandals and shell games.

Here’s just a few that make this month’s list.

The Eric Massa mess – Among the newly uncovered allegations: “Beginning in March 2009,” the New York Times reports, “male staffers complained that their boss had touched them in a sexual manner, came up with reasons to have staffers travel alone with him on overnight trips, and expressed a desire to have sex with the men in the office.”

Tiger’s room is available at rehab, Eric.

“You asked for it, you go it, Toyota” – a slogan that seems amazingly prescient considering the trouble the car maker continues to find itself in. “The National Highway Traffic Safety Administration has sent another letter to Toyota telling them that the initial fine of $16 million might be increased by way of a “second penalty based on documents indicating the existence of two separate defects in the pedals, which were recalled in January,” the Times reported.

The Good News:  American auto makers should clean up with great deals!

Harry Abrahamsen, a client of banking giant UBS “pleaded guilty to tax fraud, the ninth American caught up in an investigation of the bank’s offshore private banking services.”

Offshore accounts, is that part of the rewards service?

Speaking of giants, “Pfizer recently became the latest drug maker to start disclosing payments to doctors who act as consultants or speakers,” who are clearly shilling for the drug maker.

So that’s why Viagra costs so much!

Pittsburgh Steelers quarterback Ben Roethlisberger – accused of sexual assault on a 20-year-old will walk. The district attorney for Milledgeville, Georgia announced “that he did not have enough evidence to bring charges in the case.”  However, Steelers owner Art Rooney is in talks with the NFL and may impose penalties on the star quarterback.

Next time you want a drink, Ben, order in.

Washington Mutual – memos released by a Senate panel reveal an incredible level of fraud and risky lending going on at the largest banking institution to fail.  “Using a toxic mix of high-risk lending, lax controls and compensation policies which rewarded quantity over quality,” Senator Carl Levin said, “Washington Mutual flooded the market with shoddy loans that went bad.”

A train wreck that could have been avoided. Where was the SEC?

Lehman Brothers (remember them?) – Internal documents show that the investment giant, in business from 1850 until its collapse in 2008, “channeled risks through ‘Alter Ego’ [Hudson Castle].”  None of which was disclosed.  “A March report by the court-appointed examiner indicated that Lehman executives regularly used cosmetic accounting gimmicks at the end of each quarter to make its finances appear less shaky than they really were.”

Mary Kay is always looking for new salespeople.

Tennessee mother Torry Hansen – the woman who returned an adopted boy to Russia because “he is violent and has severe psychopathic issues.”  Her solution was to “put him on the Moscow-bound flight with a one-way ticket as an ‘unaccompanied minor,’ the Times said.

Now she must’ve claimed reward miles?

The Vatican – finally comes forward with new procedures regarding sex abuses cases.  According the NYTimes, “the Vatican posted online for the first time a guide to the procedures it requires bishops to follow in abuse cases.  It says that in the preliminary stages of any investigation into alleged abuse, ‘civil law concerning reporting of crimes to appropriate authorities should always be followed.”

So, why didn’t they do this from the beginning?  Oh, wait, that’s right, they didn’t have the internet back in apostolic times.

The Bailouts – “a Treasury official told The Wall Street Journal that America’s coffers would be only $89 billion lighter after all accounts were settled from the rescues, down from an earlier estimate of $250 billion.”

Wait a second, that’s good news.  How did this make the list?

Well, according to NY Times financial reporter Andrew Ross Sorkin, “The government’s $45 billion investment in Citigroup alone is on track to make a profit of nearly $11 billion, plus $8 billion or so in interest and other fees.  People inside the administration no longer refer to Citigroup as the ‘Death Star’; now it is a ‘profit center.’

“Of course, we’re still expected to lose $48 billion on the government’s rescue of the American International Group (A.I.G.). But two people close to the board suggested to me that as the company recalculates the value of assets in its portfolio that were once considered ‘toxic,’ the government could actually claw its way back to even on that investment, if it holds on to its stake long enough.”


Leave a Comment

Read More Articles
The Latest... And Sometimes Greatest