Corporate Corruption News Articles

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Fifty years ago this month, President Dwight D. Eisenhower, in his farewell address to Americans, cautioned that the "military-industrial complex" must never be allowed to "endanger our liberties or democratic processes." Despite his warning, William Hartung argues, defense contractors like Lockheed Martin have ballooned in size, scope, and influence. Hartung, the director of the Arms and Security Initiative at the New America Foundation, recently spoke with U.S. News about his new book, Prophets of War. "The military-industrial complex [is] really about the conjunction between the military itself, the weapons contractors, and in some degree the Congress. And it deals with how they kind of work in tandem to lobby for perhaps higher levels of military spending than we might otherwise need," [explained Hartung]. "The biggest Pentagon contractor [is} Lockheed Martin. They got $29 billion in Pentagon awards, which is about $6 billion more than the next company. And they are involved in almost the full gamut of weapons programs. Other than pistols or semi-automatic rifles, they make almost everything the Pentagon would want." Defense contractors ... actually help to finance think tanks that then advocate policies - whether it be regime change in Iraq or a different approach to nuclear weapons policy - that, if pursued, would be of benefit to the company. Then there's the relationship with Congress. They are very strategic in how they give money." Military spending is twice what it was under Eisenhower.

Note: For more on Lockheed's near stranglehold on business, see this NY Times article and another article on Donald Trump's full support of the military-industrial complex. For more along these lines, see concise summaries of deeply revealing news articles about corruption in government and in the corporate world.

Two of the US's biggest mortgage lenders have had mortgage foreclosures cancelled in a case that could affect other banks. The Supreme Court in Massachusetts ruled against US Bancorp and Wells Fargo in a widely watched case. Backing a lower court ruling made in 2009, it said two foreclosure sales were invalid because the banks did not prove that they owned them at the time. The decision is among the earliest to address the validity of foreclosures done without proper documentation - so-called robo-loans because they were carried out by people who were unqualified and who often did not check a single line in the paperwork. Marty Mosby, an analyst at Guggenheim Securities said: "A ruling like this will slow down the foreclosure process. They're going to have to be really precise and get everything in order. It doesn't leave a lot of wiggle room." The case also applies retrospectively to people who have already been foreclosed. Glenn Russell, a lawyer for one of the couples in the case said: "I'm ecstatic. The fact the decision applies retroactively could mean thousands of homeowners can seek recovery for homes wrongfully foreclosed upon." Analysts said the decision may also threaten banks' ability to package mortgages into securities, and may raise the spectre that loans transferred improperly will need to be bought back.

Note: For lots more from major media sources on the criminal profiteering by the largest banks and Wall Street financial firms, click here.

More than 20% of patients who received an implantable cardioverter-defibrillator -- a high-tech device that produces electrical impulses to regulate heartbeats and prevent life-threatening arrhythmias -- in recent years were not good candidates to receive the device, a new study suggests. Researchers at Duke University looked at more than 111,000 patients who received ICD implants between 2006 and 2009. More than 25,000 of those patients did not meet evidence-based criteria for receiving the device, according to the study. The risk of dying in the hospital was significantly higher for patients who received the ICD but did not meet the criteria, and 1 out of 121 patients in this category experienced complications following the implant, the study found. Dr. Robert Michler, chairman of Cardiovascular and Thoracic Surgery at Montefiore-Einstein Heart Center, said the data should act as a "wake-up call" for physicians, surgeons and patients. "Doctors are well-intentioned, but not all doctors should be determining the use of what is a very sophisticated therapy," Michler says. He says that in this case electophysiologists should be making the final determination if the patient needs the device.

Note: For powerful information from a top MD on how the profit motive corrupts the medical industry and endangers our health, click here.

A genetically engineered fish infused with genes from other species, including an eel-like creature, could soon be on dinner plates in the Bay Area and around the United States. The U.S. Food and Drug Administration is considering an application by AquaBounty Technologies Inc. of Massachusetts to bioengineer a sterile salmon that would grow extremely fast and, if all goes as planned, never set so much as a fin in a natural body of water. It would be the first genetically engineered animal to be approved for human consumption. The proposal, which is awaiting an environmental assessment and a preliminary decision by the FDA, has created a furor among environmentalists, who have dubbed the species "Frankenfish." They claim the doctored salmon could spread disease in humans or circulate mutant genes in the wild if an accident or sabotage ever set them loose. "The effect of what happens if these genetically engineered fish escape is largely unknown and has been largely unquestioned by the FDA," said Colin O'Neil, the regulatory policy analyst for the Center for Food Safety, an environmental nonprofit based in Washington, D.C. "These fish have been demonstrated to be less healthy. Consumers clearly do not want to eat genetically engineered salmon."

Note: For a superb summary of the dangers posed by genetically-modified foods, click here.

America's big businesses are less and less American. They're going abroad for sales and employees. That's one reason they've showed record-breaking profits in 2010 while creating almost no American jobs. Consider one of the most popular products for Christmas gifts of all time - Apple's iPhone. Researchers from the Asian Development Bank Institute have dissected an iPhone, whose wholesale price is around $179, to determine where the money actually goes. Only about $11 of that iPhone goes to American workers, mostly researchers and designers. Even old-tech American companies made big money abroad in 2010 - and created scads of jobs there. General Motors, for example, is now turning a nice profit, and American investors are bullish about its future. That doesn't mean GM will be creating lots more blue-collar jobs in America, though. 2010 was a banner year for GM's foreign sales - already two-thirds of its total sales, and rising. In October, GM became the first automaker to sell more than 2 million cars a year in China. The company is now making more cars in China than in the United States. Meanwhile, back home in the United States, GM has slashed its labor costs. New hires are brought in at roughly half the wages and benefits of former GM employees, under a two-tier wage structure accepted by the United Auto Workers. Almost all of GM's U.S. suppliers have also cut their payrolls.

Note: Robert Reich, former U.S. secretary of labor, is professor of public policy at UC Berkeley and the author of the new book Aftershock: The Next Economy and America's Future. He blogs at www.robertreich.org.

About eight of every 10 registered lobbyists who work for scanner-technology companies previously held positions in the government or Congress, most commonly in the homeland security, aviation or intelligence fields, a Washington Post review of lobbying-disclosure forms and other data shows. Industries routinely employ well-connected lobbyists to seek favorable legislation and regulations in the nation's capital. But the extent of the connections to the federal government is particularly notable given the relatively small size of the scanner industry, which is dominated by half a dozen specialized businesses with heavy investments in airport and border security technology. The roster of lobbyists for L-3 Communications includes former U.S. senator Alfonse M. D'Amato (R-N.Y.) and Linda Daschle, a former federal aviation official who is married to Thomas A. Daschle (D-S.D.), a former Senate majority leader. L-3 has won nearly $900 million worth of TSA business, including for its "millimeter-wave" machines used for airport body scans. Former homeland security chief Michael Chertoff, a longtime advocate for increased use of passenger scanners, worked until recently as a consultant for Rapiscan, which provides "backscatter" X-ray scanners to the TSA. Privacy and civil liberties advocates and other critics argue that the industry's lobbying ties have encouraged a frenzy of TSA spending on technologies that are often untested or ineffective.

Note: For key reports from major media sources on corporate and government corruption, click here and here.

Excerpts from complaint by New York State Attorney General (and Governor-Elect) Andrew Cuomo: E&Y [Ernst and Young] substantially assisted Lehman Brothers Holdings Inc., now bankrupt, to engage in a massive accounting fraud, involving the surreptitious removal of tens of billions of dollars of securities from Lehman’s balance sheet in order to create a false impression of Lehman’s liquidity, thereby defrauding the investing public. As the financial crisis deepened in 2007 and 2008 and Lehman’s liquidity problems intensified, E&Y ... assisted Lehman in defrauding the public about the Company’s deteriorating financial condition, particularly its leverage. As the public auditor for Lehman, E&Y had the absolute obligation to ensure that Lehman’s financial statements ... did not mislead the public. Instead of fulfilling this obligation ... E&Y sat by silently while Lehman deceived the public by concealing [fraulent] transactions and misrepresenting the Company’s leverage. By doing so, E&Y directly facilitated a major accounting fraud, and helped Lehman mislead the public as to its true financial condition. E&Y, which reaped over $150 million in fees from Lehman, must be held accountable for its role in this fraud.

Note: For key reports from reliable sources detailing the fraud that led to the financial crisis and bailout of Wall Street by taxpayers, click here.

More than 100 American cities could go bust next year as the debt crisis that has taken down banks and countries threatens next to spark a municipal meltdown, a leading analyst has warned. Meredith Whitney, the US research analyst who correctly predicted the global credit crunch, described local and state debt as the biggest problem facing the US economy, and one that could derail its recovery. "Next to housing this is the single most important issue in the US and certainly the biggest threat to the US economy," Whitney [said]. "There's not a doubt on my mind that you will see a spate of municipal bond defaults. You can see fifty to a hundred sizeable defaults – more. This will amount to hundreds of billions of dollars' worth of defaults." American cities and states have debts in total of as much as $2tn. US states have spent nearly half a trillion dollars more than they have collected in taxes, and face a $1tn hole in their pension funds, said the CBS programme, apocalyptically titled The Day of Reckoning.

Note: For a treasure trove of reports from major media sources on the dire impacts of the financial crisis and government bailout of financial capitalists at taxpayers' expense, click here.

Nigeria announced today that in exchange for $250 million, the African nation has dropped bribery charges against Dick Cheney, eight others and Halliburton, the oil-services company he headed before becoming vice president. African and U.S. media say Halliburton and Cheney have not commented on the deal, which the head of Nigeria's anti-corruption agency said was offered by Texas-based Halliburton. As The Wall Street Journal points out, "U.S. regulators collected $1.28 billion in penalties and criminal fines in the Bonny Island case after settling charges of violating the Foreign Corrupt Practices Act, a 1977 law that bans the bribery of foreign officials to obtain business." Femi Babafemi, a spokesman for the Economic and Financial Crimes Commission, said that the $250 million would include roughly $130 million frozen in a Swiss bank, and that remainder would be paid as fines, Agence France-Presse reported Tuesday. But a source told AFP $100 million was in Switzerland and $30 million was in Monaco, saying the money was paid to an intermediary but never passed on as part of the bribery scheme.

Note: It sounds like Cheney and Halliburton basically bribed their way out of a potentially very damaging court case. For lots more from major media sources on corporate and government corruption, click here and here.

Bank of America will pay $137.3 million to settle allegations that it defrauded schools, hospitals and dozens of other state and local government organizations, federal officials said [on December 7]. The settlement stems from a long-running investigation into misconduct in the municipal bond business that raises money for localities to pay for public services. Bank of America is accused of depriving local organizations of millions of dollars by engaging in illegal behavior when investing the proceeds of municipal bond sales. The bank is paying $107.8 million to these organizations in restitution, $25 million to the Internal Revenue Service for abuses related to the tax-free status of municipal bonds and $4.5 million to state attorneys general for costs related to their investigations. A number of bankers and other professionals from a variety of financial firms have pleaded guilty in the probe, which centered on companies conspiring to win municipal securities business in violation of statutes requiring fair competition. The banking giant is accused of taking part in a conspiracy in which it and other banks paid kickbacks to win the business of municipalities seeking to invest the proceeds of bond sales before the money is ready to be spent.

Note: For key reports on financial fraud from reliable sources, click here.

As a result of an amendment that I was able to include in the Wall Street reform bill, we have begun to lift the veil of secrecy at the Fed. It is unfortunate that it took this long, and it is a shame that the biggest banks in America and Mr. Bernanke fought to keep this secret from the American public every step of the way. But, the details on this bailout are now on the Federal Reserve's website. This is a major victory for the American taxpayer and for transparency in government. After years of stonewalling by the Fed, the American people are finally learning the incredible and jaw-dropping details of the Fed's multi-trillion-dollar bailout of Wall Street and corporate America. What have we learned so far from the disclosure of more than 21,000 transactions? We have learned that the $700 billion Wall Street bailout signed into law by President George W. Bush turned out to be pocket change compared to the trillions and trillions of dollars in near-zero interest loans and other financial arrangements the Federal Reserve doled out to every major financial institution in this country.

Note: The author is Senator Bernie Sanders (I-VT). For key reports from reliable sources on the massive federal bailout of the biggest banks and financial firms, click here.

The nation’s workers may be struggling, but American companies just had their best quarter ever. American businesses earned profits at an annual rate of $1.659 trillion in the third quarter, according to a Commerce Department report. That is the highest figure recorded since the government began keeping track over 60 years ago. The next-highest annual corporate profits level on record was in the third quarter of 2006, when they were $1.655 trillion. Corporate profits have been doing extremely well for a while. Since their cyclical low in the fourth quarter of 2008, profits have grown for seven consecutive quarters, at some of the fastest rates in history. As a share of gross domestic product, corporate profits also have been increasing, and they now represent 11.2 percent of total output. That is the highest share since the fourth quarter of 2006, when they accounted for 11.7 percent of output.

Note: Long-term unemployment is at a record high, yet corporations are raking in record profits. With record profits, why aren't corporations hiring more new employees? For many reports from reliable souces on corporate profiteering, click here.

About 48 of the more than 1,730 California doctors who received money from pharmaceutical companies over the past 21 months have been the subject of disciplinary action, a database compiled by the investigative news organization ProPublica found. While that represents less than 3 percent of the California doctors who take pharmaceutical money, the fact that drug companies are paying those doctors - some of whom have multiple disciplinary actions - for their expertise calls into question how closely these companies vet the physicians who serve as the spokespeople for their drugs. California doctors have received $28.6 million from top pharmaceutical companies since 2009, with at least three physicians collecting more than $200,000 and 36 others making more than $100,000 for promoting drug firm products. That cash flowing from drug companies to doctors has raised ethical concerns from some observers. "If they're getting as much money from pharmaceutical companies as they do for being a doctor, what are they really? Are they working for a pharmaceutical company, or are they being a doctor?" asked Lisa Bero, a pharmacy professor at UCSF who studies conflicts of interest in medicine and research.

Note: For a detailed analysis of corruption in the pharmaceutical industry by a highly-respected doctor, click here.

In a rare move, the Justice Department on Tuesday announced that it had charged a former vice president and top lawyer for the British drug giant GlaxoSmithKline with making false statements and obstructing a federal investigation into illegal marketing of the antidepressant Wellbutrin for weight loss. "This is absolutely precedent-setting – this is really going to set people's hair on fire," said Douglas B. Farquhar, a Washington lawyer. "This is indicative of the F.D.A. and Justice strategy to go after the very top-ranking managing officials at regulated companies." The indictment accuses the Glaxo official, Lauren C. Stevens of Durham, N.C., of lying to the Food and Drug Administration in 2003, by writing letters, as associate general counsel, denying that doctors speaking at company events had promoted Wellbutrin for uses not approved by the agency. Ms. Stevens "made false statements and withheld documents she recognized as incriminating," including slides the F.D.A. had sought during its investigation, the indictment stated. The company was cooperating fully with a federal investigation into allegations of illegal sales and marketing of Wellbutrin. Last year, it set aside $400 million to resolve the case, which is still pending. Two weeks ago, in an unrelated case, GlaxoSmithKline agreed to pay $750 million to the government to settle civil and criminal complaints that it sold tainted or ineffective products from a large manufacturing facility in Puerto Rico.

Note: Even with fines in the hundreds of millions of dollars assessed to many of the large pharmaceuticals, why isn't more being done? See what one of the top doctors in the US revealed about corruption in health care at this link.

Two of the largest pilots' unions in the nation are urging commercial pilots to rebel against current airport screening rules. In late October, the Transport Security Administration implemented more invasive patdown rules. Travelers and pilots were faced with a new dilemma -- have a revealing, full-body scan or what some are calling an X-rated patdown. Pilots are piping mad over the options, saying the full-body scanners emit dangerous levels of radiation and that the alternative public patdown is disgraceful for a pilot in uniform. Some pilots have said they felt so violated after a patdown, they were unfit to fly. The patdowns, implemented Oct. 29, allow TSA officers to pat down passengers with the front of their hands, instead of the backs of their hands. A security expert who demonstrated the new procedure on a mannequin for ABC News explained the changes. "You go down the body and up to the breast portion," said Charles Slepian of the Foreseeable Risk Analysis Center. "If it's a female passenger, you're going to see if there's anything in the bra." The new patdown protocol could be used at any of the nation's 450 airports on passengers who require additional screening. Tens of thousands of passengers are submitted to patdowns and full-body scanners every day. More than 300 full-body scanners are being used at 65 airports across the country.

Note: And what about the general public having to submit to being groped?

Few ecological disasters have been as confounding as the massive and devastating die-off of the world's honeybees. The phenomenon of Colony Collapse Disorder (CCD) -- in which disoriented honeybees die far from their hives -- has kept scientists, beekeepers, and regulators desperately seeking the cause. The long list of possible suspects has included pests, viruses, fungi, and also pesticides, particularly so-called neonicotinoids, a class of neurotoxins that kills insects by attacking their nervous systems. For years, their leading manufacturer, Bayer Crop Science, a subsidiary of the German pharmaceutical giant Bayer AG (BAYRY), has tangled with regulators and fended off lawsuits from angry beekeepers who allege that the pesticides have disoriented and ultimately killed their bees. A cheer must have gone up at Bayer on Thursday when a front-page New York Times article, under the headline "Scientists and Soldiers Solve a Bee Mystery," described how a newly released study pinpoints a different cause for the die-off: "a fungus tag-teaming with a virus." The Bayer pesticides, however, go unmentioned. What the Times article did not explore -- nor did the study disclose -- was the relationship between the study's lead author, Montana bee researcher Dr. Jerry Bromenshenk, and Bayer Crop Science. In recent years Bromenshenk has received a significant research grant from Bayer to study bee pollination.

Note: Read the full, revealing article to learn how money often corrupts science. For lots more from reliable sources on corporate corruption, click here.

GlaxoSmithKline, the British drug giant, has agreed to pay $750 million to settle criminal and civil complaints that the company for years knowingly sold contaminated baby ointment and an ineffective antidepressant – the latest in a growing number of whistle-blower lawsuits that drug makers have settled with multimillion-dollar fines. Altogether, GlaxoSmithKline sold 20 drugs with questionable safety that were made at a huge plant in Puerto Rico that for years was rife with contamination. Cheryl D. Eckard, the company's quality manager, asserted in her whistle-blower suit that she had warned Glaxo of the problems but the company fired her instead of addressing them. Among the drugs affected were Paxil, an antidepressant; Bactroban, an ointment; Avandia, a troubled diabetes drug; Coreg, a heart drug; and Tagamet, an acid reflux drug. Justice Department officials announced the settlement in a news conference Tuesday afternoon in Boston, saying a $150 million payment to settle criminal charges was the largest such payment ever by a manufacturer of adulterated drugs. The outcome also provides $600 million in civil penalties. The share to the whistle-blower will be $96 million, one of the highest such awards in a health care fraud case.

Note: For key reports from major media sources on corporate corruption and criminality, click here.

"Inside Job," as the movie title implies, sees the 2008 financial meltdown, its causes and ongoing catastrophic consequences, as the work of crooks. Crooks as in members of the financial services industry. Aided and abetted by ... administrations of both political stripes, ratings agencies and regulators, all of whom were committed to an ideology that enabled larceny on a grand scale. The documentary, written, produced and directed by Bay Area high-tech entrepreneur turned filmmaker Charles Ferguson, opened in Bay Area cinemas [on October 22]. Even if you've read through the growing pile of books, congressional hearings and material generated by the Financial Crisis Inquiry Commission, it has plenty to remind you why you are furious, all over again. If further proof is needed, the film effectively demolishes the "who knew?" argument proffered by Goldman Sachs Group CEO Lloyd Blankfein and his peers. And it makes a convincing case that much of the obscenely compensated financial services industry has been rotten to the core for decades, but is yet to be held truly accountable for activities, both immoral and illegal.

Note: For lots more from reliable sources on the criminal practices of the largest financial corporations and regulatory agencies which led to the current economic crisis, click here.

Research universities that accept millions of dollars from oil companies have failed to shield themselves from corporate influence, according to a new study that faults UC Berkeley, UC Davis, Stanford and seven others. Such cozy relationships give energy companies too much control in deciding what research to fund and what faculty should study, says the report from the Center for American Progress, "Big Oil Goes to College". The contracts ... give more control to companies that foot the bill than to researchers, argues the report's author, Jennifer Washburn. "We want to see university research translate into commercial technology, but we don't want the research itself to be directed by individual corporations," she told The Chronicle. "They shouldn't turn California's flagship universities into the research arm of a private corporation." The report found that industry control over research is "poorly defined" in UC Davis' long-term contract with Chevron Technology Ventures. It says industry shares control with faculty at UC Berkeley, and control is fully corporate at Stanford. The report also says none of the three California contracts "requires peer review when selecting faculty research projects."

Note: For lots more from major media sources on corporate corruption, click here.

Doctors and patients are being misled about the effectiveness of some drugs because negative trial results are not published, experts have warned. Writing in the British Medical Journal, they say that pharmaceutical companies should be forced to publish all data, not just positive findings. The German team give the example of the antidepressant reboxetine, saying publications have failed to show the drug in a true light. Reboxetine (Edronax), made by Pfizer, is used in many European countries, including the UK. But its rejection by US drug regulators raised doubts about its effectiveness, and led some to hunt for missing data. This is not the first time a large drug company has come under fire about its published drug trial data. Pharmaceutical giant GlaxoSmithKline (GSK) was criticised for failing to raise the alarm on the risk of suicidal behaviour associated with its antidepressant Seroxat. GSK has also been forced to defend itself over allegations about hiding negative data regarding another of its drugs, Avandia, which is used to treat diabetes. "Our findings underline the urgent need for mandatory publication of trial data," [the researchers] say in the BMJ. They warn that the lack of all information means policy makers are unable to make informed decisions. In the US, it is already a requirement that all data - both positive and negative - is published.

Note: For a powerful summary of government/corporate corruption in the pharmaceutical industry by a respected former editor of a major medical journal, click here.

Important Note: Explore our full index to revealing excerpts of key major media news articles on several dozen engaging topics. And don't miss amazing excerpts from 20 of the most revealing news articles ever published.