Daylife/AP Photo by Antonio Calanni
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The man walked into a Los Angeles police station, wearing an Armani jacket and a Rolex, and admitted he was wanted for an alleged $170-million scam involving his technology firm…
“I am Stein Bagger,” the man said, putting his hands on the counter. “I’m a fugitive from Europe and I’m here to turn myself in…”
Until his flamboyant appearance in downtown Los Angeles, Bagger had last been seen on Nov. 27 in Dubai, United Arab Emirates, where he was vacationing with his wife and daughter.
At the time, he was on top of the world. Bagger, chief executive of Copenhagen-based IT Factory, had recently been named Danish Entrepreneur of the Year by Ernst & Young after leading the previously crumbling computer company into what seemed to be an incredible turnaround. The Danish press reported that IT Factory had doubled its revenue and profit for each of its last three fiscal years.
The company was reportedly due to announce a $53.6-million profit. But, within days, it was revealed that more than 90% of the company’s revenue was based on fraud.
The company had allegedly created dummy contracts for computers and software from fake companies, then sold those leasing contracts to banks and other investors. Bagger allegedly forged the signature of the company’s chairman to avoid board scrutiny.
So, who’s doing oversight on the books of the leading lights of World Capitalism? The Three Stooges?
“So, who’s doing oversight on the books of the leading lights of World Capitalism? The Three Stooges?”
If it’s a private company, the company itself.
“The company had allegedly created dummy contracts for computers and software from fake companies, then sold those leasing contracts to banks and other investors.”
Why didn’t the banks and investors who bought these contracts notice when the fake companies didn’t pay their bills?
#1 – Oh, I see. They weren’t a taxpaying corporation and didn’t have loans?
# 3 Keaneo said, “#1 – Oh, I see. They weren’t a taxpaying corporation and didn’t have loans?”
Obviously, you don’t “see”. Unless you get a tax audit, the gov doesn’t look at your books and they were “making” lots of money so I don’t think they had loans.
You’ve never run a sizable company, have you?
#4 – Paddy-RAMBO
>>You’ve never run a sizable company, have you?
Don’t be getting too big for your britches, son.
Radio Shack may be a large, multi-national, publicly-traded corporation, but being a counter boy for the company doesn’t make you a business tycoon. You’ve got a ways to go before you are in the same league with Cornelius Vanderbilt or John D. Rockefeller.
Come on PaddyO, clearly capitalism itself is a problem, and the only solution is to give power to the government.
# 6 MikeN said, “Come on PaddyO, clearly capitalism itself is a problem, and the only solution is to give power to the government.”
Yeah, everyone should just turn over all capital to the gov’t.
On another note. This company got an E&Y award. E&Y used to require a major acct firm verify the books. I guess that isn’t a requirement anymore. Or, they did a good job of forgery. Anyone remember “Z Best” carpet cleaning company?
The question that comes to my mind after reading this is:
Has our homeland security improved at all since 9/11?
If this guy was a fugative, how did he manage to get into the US, undetected?
I realized this is retorical.
The guy was wanted in Europe for fraud, not something that would trigger the terrorist flags that homeland security is looking for. I’m not saying that this proves that homeland security is great, but this certainly isn’t evidence of its failure.
And if a corporation of that size carries no debt at all then they are not utilizing their available resources well at all. A certain amount of credit allows for a lot of fiscal flexibility in that you can use it to pay bills when there is short term income that will show up to cover it. That way you don’t have to pull money out of large, longer term investments that have a better return than the interest you can pay for the short term credit.
And that is something even a counter boy at Radio Shack could very possibly know…
Of course, unless there is evidence of fraud there’s no reason for the government to go looking for it and apparently there was no evidence until recently. Of course, it was bound to fall apart when (as chuck, #2 mentioned) the banks and investors tried to bill against the fictional contracts.
Anyone remember ZZZZ Best Carpet Cleaning?
http://en.wikipedia.org/wiki/Barry_Minkow
Anyone remember ZZZZ Best Carpet Cleaning?
http://en.wikipedia.org/wiki/Barry_Minkow
Same scam… different decade.
Damn…. sorry about the dup post. Can you please delete Mr. Editor? Thank you.
# 10 Ron Larson said, “Anyone remember ZZZZ Best Carpet Cleaning?”
Yes, as I mentioned above.
#13 – Paddy-RAMBO
>>Yes, as I mentioned above.
No, you mentioned “Z”. That’s not the name of the company. It’s “ZZZZ”. I’da thunk that even a counter boy at Radio Shack would know something about trademarking and product branding.
I guess it’s not part of the job description, though. Neither “seasonal associates” nor “sales associates” appear to need that knowledge.
http://www.jobsatradioshack.com/
Boy Paddy-O, did you call Mr. Must Turd’s wife ugly or something? Even when he has no point at all he spouts out crap about your posts.
#16 – Paddy-RAMBO
Tee hee! Giggle giggle! The only thing you ever “owned” was one a them thar kewl remote-controlled radio cars, down the ‘Shack.
Your ignorance is breath-taking.
I believe this is classically know as the “Costanza”
scheme and it is as old as the Seinfeld chronicles.
And this my friends is why we have the SEC and various State agencies to monitor such companies.
Regulation might be a thorn in your undies BUT, it does help out those who did their due diligence but were lied to.
# 19 Mr. Fusion said, “And this my friends is why we have the SEC and various State agencies to monitor such companies.”
IF, they are publicly traded. Otherwise, no.
Denmark does not apologize.