Morning Brief: Olympus admits hiding losses in big merger payouts; voters go to the polls to determine major ideological issues in Ohio and Mississippi
In what may be one of the largest corporate scandals to be revealed, Olympus has admitted that it made more than $1 billion in merger payouts in order to hide investment losses. The NYT called the news of the growing scandal “one of the biggest accounting fraud cases in corporate history.”
At the center of the case is Michael C. Woodford, the former CEO who was fired when he exposed the fraud. The board of directors, at the time, said that Woodford did not understand the Japanese corporate culture and had to go. Woodford had worked for Olympus for 30 years.
The report released from Olympus is the first crack in that corporate stonewall. “It is true that there were inappropriate dealings,” the new president of Olympus, Shuichi Takayama, is quoted as stating in a news conference. “Our previous statements were in error.” Unfortunately, Takayama did not go so far as to admit corporate fraud, opening to door to further revelations and more scandal.
It is always the cover-up that has the most repercussions.
Yesterday was election day in the U.S. and several ballot measures appeared on state ballots that were a perfect reflection of the state of the politics in America.
In Ohio, voters were asked to validate the attack on public employee unions. Led by Republican governor John Kasich, the legislature had, by one vote, passed an anti-union measure that severely restricted the rights of state workers. Ohio, a swing state in most presidential elections, but also a manufacturing state, has a long history of support for union rights.
The voters overwhelmingly rejected the Republican restrictions in a strong rebuke to both the governor and the legislature.
In Mississippi, voters were asked to support a measure that would define human life as beginning at conception, virtually outlawing abortion, as well as most forms of contraception. That effort, too, went down to defeat by a wide margin.
But while Americans voted against efforts to restrict their rights, they voted back in the same politicians who were behind the efforts to restrict their rights in the first place. The big exception was in Arizona where voters in Mesa were on the verge of recalling their state senator, Russell Pearce, a highly influential state politician, and a major player in promoting the state’s controversial immigration law.
At 2pm EST there will be a 30-second test of the Emergency Alert System which will involve all television and radio stations. Because the test will involve “live code” there will be no warning that this is only a test.
Remember, this is only a test folks.