1.

Tyco Corporate Scandal of 2002

The case of Tyco’s corporate scandal of 2002 focuses on the problem of unethical
business practice and related issues. Tyco was a large organization that grew through numerous
acquisitions. Tyco’s case shows that the problem was the unethical business practices of a
number of its top-ranking officers, especially CEO Kozlowski. Kozlowski was involved in
numerous financial transactions that were not included in the financial reports of the company.
Kozlowski was also involved in unethical transactions with other Tyco officers and lower
ranking employees to cover up for Kozlowski’s illegal financial transactions. Kozlowski even
got outsiders involved in the problem when his second wife received money diverted from the
firm. Court proceedings proved that Kozlowski stole millions of dollars from Tyco, and that his
illegal financial transactions were extensive. Kozlowski and other officers from Tyco were
imprisoned. Tyco declined as investors lost confidence in the company.
Tyco’s Unethical Leadership. The unethical business practice of leaders was observed in
Kozlowski. Kozlowski was the main actor in the financial troubles and legal battles in this case.
Kozlowski was the main recipient of the money stolen from Tyco. In addition, he was the main
influential person who persuaded other top-ranking Tyco officers and lower ranking employees
to get involved and to keep silent to cover up for Kozlowski’s illegal activities. This case shows
that extensive involvement of Kozlowski and other leaders in unethical and illegal activity
brought Tyco down.
Unethical Business Practice of Subordinates. The complications in Tyco’s case involved
people other than Kozlowski. Kozlowski recruited the support of other high-ranking officers in
the organization. He also convinced some lower ranking employees to keep their silence in
exchange for financial benefits. Also, Kozlowski convinced one of the board members to keep
silent about the illegal financial transactions on the mansion Tyco paid for the benefit of
Kozlowski and his wife. In exchange, the board member received financial benefits.
Unethical Auditing Practice. The auditing firm PricewaterhouseCoopers responsible for
checking the financial reports of Tyco failed to identify Kozlowski’s illegal financial
transactions. As a result, Kozlowski’s unethical business practice continued and became
extensive. These practices became more difficult to stop because of absent constraining influence
from the auditing firm.
2. President of Ufotable Anime Studio Steps Down Following Tax Scandal
The old saying is that there are two things certain in this life: death and taxes.
Unfortunately, the latter has come a calling for the fan favorite anime studio Ufotable. The
Japanese government recently revealed that the studio owes around $3.65 USD million in unpaid
taxes, causing the President of the studio, Hiraku Kondo, to step down. What may this mean for
the animation house?
The anime studio has been responsible for some of well known anime series and movies,
such as the Fate/Stay series, the Fate/Zero series, Tales of Symphonia, and the Junji Ito film
adaptation of Gyo. The studio has also worked on several video game cut scenes for popular
games such as the God Eater series, the "Tales" series, and Code Vein to name a few.
Unfortunately, the troubles don't end with just the purported tax evasion, the Japanese
government is also stating that the company misappropriated funds that were collected as part of
a charity campaign to assist victims of the 2011 Tohoku earthquake. Based on this, the Tokyo
Regional Taxation Bureau had also conducted a search of the offices in March of this year. What
this means for the future of the animation studio is yet to be seen, but hopefully, for fans of the
anime series and video games that Ufotable has had a hand in, the company can make amends
and continue putting out the series that fans have grown to follow.
3. Valeant Pharmaceuticals scandal
The Valeant Pharmaceuticals scandal started in August 2015 when Bernie Sanders and
other congressmen asked the company to explain why it had raised the price of two drugs.
Investigations showed that the company’s strategy had been to acquire small
pharmaceutical companies and raise the prices of their drugs, rather than investing in its own
R&D. This led to public outcry and a fall in the company’s share price. The scandal deepened in
October when it was alleged that Valeant controlled a chain of pharmacies called Philidor, and
had abused this position to inflate the size of its order book and report higher profits. The
company has since changed its name to Bausch Health Companies Inc.
4. The Kobe Steel scandal
Kobe Steel (KBSTY), a century-old industrial giant, has admitted to falsifying data on
products sold to top customers like Boeing (BA) and Toyota (TM). It says as many as 500
companies could be affected, including manufacturers of Japan's famous bullet trains.
Essentially, Kobe employees faked reports to make it look as though products met the
specifications requested by customers when in fact they didn't. The scandal initially concerned
copper and aluminum parts, but has spread to steel products, too. It has raised doubts about
thousands of tons of material shipped over a period of more than 10 years. For the aluminum and
copper parts, false data was given about their strength and durability.
Kobe steel sells metal to all kinds of different businesses. Some of the main industries to
which it has supplied the suspect products include aviation, automobiles, railways and nuclear
power. In the aerospace industry, Boeing and Japan's Mitsubishi (MHVYF) both used Kobe parts
made with falsified data in their aircraft. But the two companies insisted they don't believe the
parts present a safety concern. Japanese automakers Toyota (TM), Honda (HMC) and Nissan
(NSANF) acknowledged they had used affected Kobe materials but were still assessing the
consequences for their vehicles.
 5. Equifax’s Data Breaches
Credit rating firm Equifax makes its profits from selling personal, often sensitive
information to financial institutions and lenders. But in September of 2017, it revealed that it had
been at the center of one of the worst data breaches in history, with the information of some 145
million people, about half of the U.S. population, compromised.
In the aftermath, CEO Richard Smith stepped down, as well as its chief information
officer and chief security officer, amid revelations that Equifax was aware of the system flaw
that the hackers took advantage of since March. Then, when the hack did happen, the firm waited
a full two months before disclosing it.
Meanwhile, the Justice Department is reportedly looking into whether top Equifax
executives committed insider trading when selling some $1.8 billion in shares just before the
breach was disclosed.
6. The Uber Scandal
Uber revealed that more than 3,000 sexual assaults occurred during rides on its service in
the U.S. in 2018. It shared these statistics in a comprehensive U.S. Safety Report
The ride-hailing company and peers, including Lyft, have been criticized over these
personal safety issues for years. Uber has seen an uptick in lawsuits over sexual assaults that
allegedly occurred between riders and drivers in recent years.
The report also revealed that Uber received 235 reports of rape -- the most serious
category of sexual assault -- during rides in 2018, an average of four reported incidents a week in
the states. That was a worse than the 229 reports of rape that the company received in 2017, but
the rate of those reports decreased by 17%.
Drivers and passengers using Uber’s ride-hailing service are both at risk. Riders
accounted for 45% of accused parties across the 5 most serious sexual assault categories, Uber
said in its report. (Some riders reportedly assaulted other riders.) However, 92% of the reported
rapes were allegedly committed by drivers.
References

Kolondy, L. (2019). Here’s what Uber is doing to solve its sexual assault problem after
reporting more than 3,000 incidents last year. CNBC.
Romeo, J. (2017, March 25). Panmore Institute. Retrieved from Tyco Corporate Scandal of 2002
(Ethics Case Analysis): http://panmore.com/tyco-corporate-scandal-2002-case-analysis
Shane, D. (n.d.). The Kobe Steel scandal: What we know so far. Retrieved from
https://money.cnn.com/2017/10/16/news/companies/kobe-steel-scandal-what-we-
know/index.html
Will, S. H. (2018, November 18). Top 10 biggest corporate scandals and how they affected share
prices. Retrieved from https://www.ig.com/en/news-and-trade-ideas/top-10-biggest-
corporate-scandals-and-how-they-affected-share-pr-181101#valeant