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    Tyco Internatio NAL: Security Company

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    Angelica Pagaduan
    Dennis Kozlowski, the CEO of Tyco International, and several other executives were involved in an accounting scandal at the company in the early 2000s. Kozlowski committed unethical practices such as theft of company funds, tax evasion, and commingling of personal and company assets. The company's auditor, PricewaterhouseCoopers, failed to catch these illegal transactions. In 2005, Kozlowski and the CFO were found guilty of grand larceny and other charges and were ordered to repay $134 million to Tyco. The scandal showed that even leaders with good backgrounds can exhibit unethical behavior and that companies need strong ethics implementation and internal controls.

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    Tyco Internatio NAL: Security Company

    Uploaded by

    Angelica Pagaduan
    139 views13 pages
    Dennis Kozlowski, the CEO of Tyco International, and several other executives were involved in an accounting scandal at the company in the early 2000s. Kozlowski committed unethical practices such as theft of company funds, tax evasion, and commingling of personal and company assets. The company's auditor, PricewaterhouseCoopers, failed to catch these illegal transactions. In 2005, Kozlowski and the CFO were found guilty of grand larceny and other charges and were ordered to repay $134 million to Tyco. The scandal showed that even leaders with good backgrounds can exhibit unethical behavior and that companies need strong ethics implementation and internal controls.

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    TYCO_COMPANY-ACCOUNTING_SCANDALS

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    Dennis Kozlowski, the CEO of Tyco International, and several other executives were involved in an accounting scandal at the company in the early 2000s. Kozlowski committed unethical practices such as theft of company funds, tax evasion, and commingling of personal and company assets. The company's auditor, PricewaterhouseCoopers, failed to catch these illegal transactions. In 2005, Kozlowski and the CFO were found guilty of grand larceny and other charges and were ordered to repay $134 million to Tyco. The scandal showed that even leaders with good backgrounds can exhibit unethical behavior and that companies need strong ethics implementation and internal controls.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    139 views13 pages

    Tyco Internatio NAL: Security Company

    Uploaded by

    Angelica Pagaduan
    Dennis Kozlowski, the CEO of Tyco International, and several other executives were involved in an accounting scandal at the company in the early 2000s. Kozlowski committed unethical practices such as theft of company funds, tax evasion, and commingling of personal and company assets. The company's auditor, PricewaterhouseCoopers, failed to catch these illegal transactions. In 2005, Kozlowski and the CFO were found guilty of grand larceny and other charges and were ordered to repay $134 million to Tyco. The scandal showed that even leaders with good backgrounds can exhibit unethical behavior and that companies need strong ethics implementation and internal controls.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    of 13

    TYCO

    INTERNATIO
    NAL
    Case Study
    Security Analysis: Accounting
    company
    Scandals
    HISTORY

    1960- Founded by Arthur J. Rosenberg

    1964- publicly traded company


    1982 - reorganized into three business segments:
    - Fire Protection, Electronics, and Packaging.

    1986 – segment addition : Flow Control


    Early 2000s -acquired more than thirty major
    companies
    TYCO
    INTERNATIONAL CORPORATE SCANDAL
    Security company
    Unethical Leadership at Tyco.
    Ethics Issues in Tyco’s Case

    The Tyco scandal shows that ethics


    Unethical Business Practice of Subordinates.
    issues can occur in various aspects and
    components of an organization,
    including the top corporate leadership.
    Leaders and executives trusted by
    stakeholders and with seemingly
    commendable backgrounds could
    Questionable Auditing Practice
    exhibit unethical behavior and facilitate
    unethical and illegal practices that harm
    the business and its stockholders.
    ABOUT THE Dennis Kozlowski was at the center of the unethical activities in the
    business organization. As the CEO, he committed unethical practices
    COMPANY that led to the legal battles and related financial problems of Tyco.

    ACCOUNTING CONFLICTS BRIBERY


    OF INTEREST

    THEFT OF COMPANY FUNDS COMMINGLE ASSETS TAX EVASION


    Mark Swartz Stephen W. Foss
    chief financial officer CEO of a textile concern

    Richard S. Bodman Frank E. Walsh, Jr


    a venture capitalist director of the board.

    PERSONS The complications in Tyco’s case involved people other than


    Kozlowski. Kozlowski recruited the support of CFO Swartz, another
    INVOLVED high-ranking officer in the organization. Members of Tyco’s board of
    directors were also involved
    OTHERS

    Joshua Michael James S. W. Peter Joseph F. Wendy John F.


    Berman, Ashcroft Pasman Slusser Welch Lane Fort III,

    vice president British dignitary from ADT from ADT CEO of Bachman private equity former CEO and
    Company investor chair of Tyco
    PRICEWATERHOUSE The auditing firm PricewaterhouseCoopers (PwC) responsible for
    checking the financial reports of Tyco failed to identify Kozlowski’s
    COOPERS illegal financial transactions.
    ACTIONS In 2005, Kozlowski and Swartz both were found guilty on twenty-two of twenty-three
    counts of grand larceny, conspiracy, and falsifying business records and violating
    business law. The judge ordered both to pay $134 million to Tyco.

    Board Of Directors New Hampshire New York State Bank Department


    WHY THINGS
    HAPPENED?

    BOARD OF
    DIRECTORS
    IRRESPONSIBILITIES
    CONCLUSIONS
    If a company wants to survive
    and grow in today's business
    world, it needs to be more than
    just aware of ethical standards; it
    needs to be actively
    implementing them, combined
    with rigorous internal controls to
    prevent unethical and/or
    unlawful behavior.
    References:
    https://scholars.fhsu.edu/cgi/viewcontent.cgi?article=1031&context
    =aljsr
    https://danielsethics.mgt.unm.edu/pdf/Tyco%20Case.pdf
    http://panmore.com/tyco-corporate-scandal-2002-case-analysis
    https://money.howstuffworks.com/cooking-books10.htm
    https://www.financial-dictionary.info/terms/tyco-international-scandal
    /
    https://en.wikipedia.org/wiki/Tyco_International
    THANK
    YOU!
    MEMBERS:
    AGUILA, Ian Mark
    FABRO, Rain Vince
    HEMOR, Stephanie Rose
    MADAYAG, Jovie Ann
    UGAY, Paulyn Mae

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