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Best Business Crime Writing of the Year

Best Business Crime Writing of the Year

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by James Surowiecki

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A year ago it would have been difficult to conceive of an anthology of stories soley devoted to corporate malfeasance. Today, the challenge has been to keep it confined to one volume. From P.J. O’Rourke’s hilarious “How To Stuff A Wild Enron,” in which he compares trying to understand Enron’s finances to trying to buy an airline ticket at


A year ago it would have been difficult to conceive of an anthology of stories soley devoted to corporate malfeasance. Today, the challenge has been to keep it confined to one volume. From P.J. O’Rourke’s hilarious “How To Stuff A Wild Enron,” in which he compares trying to understand Enron’s finances to trying to buy an airline ticket at the best price, to Marc Peyser’s’s perceptive look at that American institution, Martha Stewart, to Joe Nocera’s investigation of how it all went wrong, the stories here are sometimes infuriating, often entertaining, and invariably informative. Best Business Crime Writing Of The Year is a report from the front lines of the war zone that has become American business today by some of our most talented and perceptive writers.

• “The New Bull Market” by Michael Kinsley from Slate
• “In Praise of Corporate Corruption Boom” by Michael Lewis from Bloomberg News
“HardBall” by David McClintick from Forbes
“The Accountants’ War” by Jane Mayer from the New Yorker
“Enron Debacle Highlights the Trouble With Stock Options” by Thomas Stewart from Business 2.0
“Investigating ImClone” by Alex Prud’homme from Vanity Fair

Editorial Reviews

From the Publisher
“This is worth a read even if you take it chunk by chunk. They are all digestible nuggets of financial misdeeds …. The details are lovely and juicy. It's all about egos, excess, lack of caution.” — USA Today
Soundview Executive Book Summaries
Tragic Mistakes, Fraud And Greed
Enron, WorldCom, Adelphia, ImClone, Tyco, Martha Stewart, Arthur Andersen and many others have had their share of bad press over the past couple of years, and that bad press has made for some terrific reading. Compiling the best of this compelling new genre of true business crime stories, The New Yorker's business columnist James Surowiecki has amassed a compelling collection of fallen leaders and the repercussions that accompanied their leaps from grace. Gleaned from the best writing to have appeared in recent magazines and newspapers, such as The Washington Post, Forbes and Vanity Fair, these stories jump off the pages with tales of tragic mistakes, convoluted fraud and outright greed.

A common thread that runs through the stories in this collection is the men and women at the top who built their companies from almost nothing, created multi-billion dollar corporations, and then destroyed them with their scandalous behavior. According to Surowiecki, this looting of corporate America by greedy CEOs is "as much a failure of the system as it was a failure of individuals."

The book's first part, "Visionaries, Hucksters and Con Men: CEOs and the Games They Played," contains many examples of top executives whose corporate malfeasance cost their companies dearly. The depth of the recent wave of corporate fraud and deception is seen through richly detailed narratives. They describe some of the world's largest companies slipping deeper and deeper into trouble due to the misdeeds of CEOs who lacked obstacles to keep them from plummeting into the quagmire of fraud and desperation as they tried to make good on impossible promises. Two stories in this section describe how WorldCom collapsed due to the inability of CEO Bernie Ebbers to properly manage the company he had assembled while he was chasing new companies to acquire.

Who Watches the Watchmen?
The book's second part, "Who Watches the Watchmen?" delves into the corruption of Wall Street and the shady accounting practices that led to the downfall of Andersen and others. Stories in this section describe how investment banks failed to protect investors from companies who could not be trusted, and instead of offering impartial advice and representing investor interests, approved investments in questionable corporate strategies. Conflicts of interest abound, and several stories describe how the accounting industry failed to act as a check on executives and instead helped them to deceive shareholders and investors. Writer Noam Scheiber suggests that the systems which are supposed to allow accountants to regulate themselves do not work.

The book's final section, "What Went Wrong, and How Do We Fix It?" takes a broader look at corporate corruption and analyzes the system that allowed these financial debacles to take place. Here, the writers describe how executive greed, investment banker corruption and accountant shenanigans are the visible signs of a system that needs a tune up. To place the capitalist system on a healthy track that benefits society as well as certain individuals, seven writers dive into the corporate muck to investigate solutions that might be able to reduce the corruption taking place. Along with encouraging more investor vigilance and a reevaluation of the use of stock options in CEO incentive packages, the writers offer their suggestions for regulatory reform and self-imposed changes for Wall Street and the rest of corporate America.

Why Soundview Likes This Book
In the past, a book that focused on the year's high crimes of business executives would have been difficult to compile. This year, with an unusual abundance of headlines featuring corporate scandals, fraud and turmoil, there was a bountiful plethora of offerings from which the editor could choose. Surowiecki has brought together numerous examples of business crime writing and has turned hard facts, complex scenarios and insider humor into a compelling book that offers deep insights, great stories and exemplary journalism. Copyright (c) 2003 Soundview Executive Book Summaries

Kirkus Reviews
Guided by the hand of New Yorker business columnist Surowiecki, a collection of articles about corporate villainy uncovered in the post-bubble meltdown is by turns depressing and enraging. It’s Surowiecki’s writing that glitters most brightly here—in the introduction, in the comments opening each section, even in the footnotes. Overall, the writers grant that executive greed and malfeasance are nothing new (self-dealing has been a cautionary element since the nation’s first business went public), but they’ve been amplified like a virus in the bloodstream and are now systemic, having corrupted all the checks and balances devised to curb them and having created all the necessary incentives to encourage them. Among the best of the 27 pieces here are P. J. O’Rourke’s humorous but also telling take on how things went bad at Enron—"Enron broke the rules of ethics. But the corporation’s worst sins seem to have been lawful"—and Peter Behr and April Witt’s revealing item on the "structural finance" that allowed Enron legally to shake down its stockholders and employees. Qwest, WorldCom, Adelphia, and Tyco all get pored over, as does Arthur Andersen and its double-dealing, overseeing the books it cooked. There are also a few articles that will have readers scratching their heads at Surowiecki’s judgment: a cutesy-snide, gossipy piece on Martha Stewart by Marc Peyser, et al., that traffics in the same celebrity culture it purports to condemn; an embarrassingly tetchy burp from Michael Kinsley: "So, now it’s the turn of corporate CEOs to feel the righteous petulance of the American people"; and a plainly bewildering stab at comedy from Michael Lewis: "Forget for a moment that a better explanation foreach stock market plunge is that the market is still pretty rich by historical standards, and historical standards are now back in fashion." Which explains exactly what? Ultimately, readers will wish that almost all the articles, of greater and lesser import, had been originally written by Surowiecki.

Product Details

Knopf Doubleday Publishing Group
Publication date:
Vintage Series
Product dimensions:
5.15(w) x 7.97(h) x 0.55(d)

Read an Excerpt

Part One

Visionaries, Hucksters, and Con Men: CEOs and the Games They Played

One of the striking things about this most recent wave of corporate fraud and deception is how much of it was not centered on Wall Street, the traditional home of financial scandal. Of course, all of the fraud was in one way or another connected to Wall Street, as CEOs misled investors and rigged financial results in an attempt to keep their stock price high. But whereas the Street was the site of the great scandals of the 1920s and the 1980s, this most recent wave swept up not merely investment bankers and stock analysts but CEOs, CFOs, and vice presidents. And the companies that made headlines were not fly-by-night operations, either. Enron was the seventh-biggest company in the Fortune 500. WorldCom was one of the world's biggest telecom companies. Tyco was routinely compared to GE. And Qwest, after merging with US West, had become one of the country's most important phone companies.

How did this happen? The pieces in this section, most of them compelling narratives about corporations sliding down the slippery slope toward fraud, go a long way toward answering that question. They give us CEOs, fed on a diet of hefty stock-option packages and hyped-up publicity, who came to drink their own Kool-Aid, imagining that they understood what no one else did, and that there were no obstacles to their visionary schemes. In many cases, it seems clear, executives did not start out intending to deceive. Instead, they made outrageous promises and then found themselves playing fast and loose with the rules in a desperate attempt to make those promises come true. Others, though, were more cynical about the process, using the hype machine to great effect and milking the system for all it was worth.

Peter Behr and April Witt, for instance, paint a vivid picture of the way Jeff Skilling's attempt to turn Enron from a stodgy old utility into a high-powered, "asset-light" New Economy firm led the company into ever riskier behavior. Similarly, both David Staples and the team of Peter S. Goodman and Renae Merle link WorldCom's collapse to Bernie Ebbers' strategy of growth-through-acquisition. Ebbers was so focused on buying new companies that he never really figured out how to run the one he had already assembled. At Qwest, meanwhile, Joe Nacchio did an excellent job of spinning elaborate scenarios of a digital future-which his company would control-but as three writers for the Rocky Mountain News show, those scenarios never came close to becoming reality. Dennis Kozlowski, meanwhile, told investors that he wanted to make Tyco the next GE. But as Mark Maremont and Jerry Markon show, what he really wanted to do was make Tyco his own personal bank. Money manager David Dreman sums up the feelings of more than a few investors when he tells Maremont and Markon, "I'm a little dazed about how much money they siphoned off."

What all of these pieces suggest is that at many companies, CEOs were simply convinced that the normal rules did not apply to them. David McClintick's narrative of Amyn Dahya's preposterous tenure as CEO of a small mining company called Casmyn Corp gives us a man who, as one board member put it, refused to take "any of the requirements of a public company seroiusly." Alex Prud'homme's profile of ImClone CEO Sam Waksal, who's been indicted for insider trading, reveals Waksal as a slick huckster more concerned with hype than reality. Marc Peyser's sharp analysis of the Martha Stewart-Waksal connection offers up a New York world in which personal connections and social networking count for too much. In "The Adelphia Story," Devin Leonard dissects the Rigas family, which came to regard Adelphia Communications, the cable company it ran, as its own private fiefdom. David Streitfeld's portrait of Critical Path CEO David Thatcher, who ended up pleading guilty to securities fraud, is an overpowering picture of just how easy it was for executives to convince themselves that they were bending, and not breaking, the rules. And even when executives did break the rules, they weren't necessarily punished for it, as David Leonhardt shows in his investigation of CEO contracts. In the heyday of the bubble, even a felony conviction was sometimes not enough to shred an executive's golden parachute. Of course, as Almar Latour and Kevin Delaney remind us, self-dealing and corporate deception are not unique to the United States, but rather flourish across the globe. In fact, they suggest, safeguards to protect investors from fraud are actually stronger here than in places like Germany and Japan, a conclusion which, however true, comes as cold comfort to those who placed their faith in the Jeff Skillings and Bernie Ebberses of the world.

Meet the Author

James Surowiecki is a business columnist for The New Yorker.

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Best Business Crime Writing of the Year 5 out of 5 based on 0 ratings. 1 reviews.
Guest More than 1 year ago
If you've been fascinated by the news out of Enron, WorldCom, ImClone, Arthur Andersen, and the others, you'll enjoy this great anthology, easily readable in a weekend, of top-notch journalism on the spate of corporate scandals that wracked America in 2002. The variety ranges from in-depth reportage on business deals to profiles of the personalities involved in the scandals. The collection will help readers understand what happened and tries to help foster an understanding of why so many companies and industries fell prey to simple greed.