5 Massive Corruption Scandals from the Last 5 Years

Cecilia Chang's Embezzlement

cecilia changIn 2010, Chang was indicted on charges of embezzling about $1 million from St. John's University, and used that money to pay for a large variety of personal items and to bribe school officials.

Chang paid for expensive wines, groceries, and car repairs. The school's then-president Father Donald Harrington was gifted with approximately $13,000 worth of expensive suits from the best tailors in Hong Kong. The chief of staff Rob Wile’s $8,474 trip to Turks and Caicos was also paid for by the school, along with other miscellaneous expenses like a $953 restaurant visit and a $2,367 shopping spree at Lanvin.

Chang stood in her own defense at a trial, which ended  disastrously. On the same day after she took the stand to defend herself, she committed suicide at home, leaving multiple suicide notes for her son, the judge, and the jury.

(Image via NY Daily News)

Rod Blagojevich's Chicago Corruption

The Celebrity Apprentice Finale After PartyFormer governor of Illinois, Rod Blagojevich, was indicted in 2009 for corruption charges. He was charged with multiple crimes, including attempting to get Chicago Tribune editors fired when they criticized his poor governorship, and expecting campaign contributions from the Children’s Memorial Hospital after it received $8 million in state funding.

One of Blagojevich’s fundraisers was indicted years earlier for taking kickbacks from investment companies that conducted business with the state. When Barack Obama was elected president in 2008, Blagojevich was arrested for attempting to sell the Senate position that President Obama vacated.

Blagojevich was officially indicted in 2009 for 19 counts of corruption. After two trials, he was convicted on 17 accounts at the end of December and was sentenced to fourteen years in prison.

(Image via fameflynet)

Bernie Madoff's $64.8B Ponzi Scheme

Bernard Madoff Leaves Court In ManhattanBernie Madoff needs no introduction, right?

Madoff was arrested in December of 2008 after his sons turned him in to the authorities. A decade-long investigation revealed that Madoff was involved in a massive Ponzi scheme totalling billions, possibly the biggest in Wall Street history.

The enforcement division of the Securities and Exchange Commission accused Madoff of fraud of $50 billion. According to the New York Times, “The Ponzi scheme began to unravel as investors, rattled by the financial crisis and reaching for cash, started to take money out faster than Mr. Madoff was able to bring fresh cash in the door.”

Victims of Madoff’s Ponzi scheme totaled more than 15,400 people, with losses of $64.8 billion in profits. Madoff was sentenced to 150 years in prison, which he didn’t appeal.

(Image via fameflynet)

Wal-Mart de Mexico Bribery Scandal

OLYMPUS DIGITAL CAMERALast year, The New York Times broke the news of Wal-Mart’s involvement in a massive bribery scandal. The giant retail company’s subsidiary in Mexico paid off the government in order to gain dominance of the country’s markets.

Executives in the U.S. knew about the bribery but shut down an internal investigation despite knowing since 2005 that laws in both countries were potentially being broken.

Wal-Mart de Mexico bribed officials to sign permits to build buildings in unsafe locations, sometimes without construction permits. In one bribe, executives paid $114,000 to get a mayor elected, ensuring that they would continue to get permits they potentially wouldn’t get otherwise.

After the piece was published, Wal-Mart’s stock fell considerably. Despite the corruption charges, the case never went to trial from the Wal-Mart de Mexico investigations.

(Image via Flickr)

Ramalinga Raju Falsifies Company Finances

ramalinga rajuRamalinga Raju is the chairman of Satyam Computer Services in India, one of the top IT firms in the country that offers consulting and other IT services. In 2009, he admitted that most of the company’s finances were falsified.

In a letter to the public, Raju wrote that, “What started as a marginal gap between actual operating profit and the one reflected in the books of accounts continued to grow over the years. It has attained unmanageable proportions as the size of company operations grew. It was like riding a tiger, not knowing how to get off without being eaten.”

The company listed 53.6 billion rupees in assets, but about 50.4 billion did not exist. Raju resigned over the scandal and faces up to 10 years in jail and $5 million in fines.

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