tyco int. scandal

7/31/2019 Tyco Int. Scandal

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RREPORTEPORTAAUDITINGUDITING & T& TAXATIONAXATION

Course Code: F-209

Submitted To

Mohammad Salahuddin Chowdhury

Lecturer,

Department of Finance,

University of Dhaka

:

Submitted By

Name Roll

Khaleda Aziz 16-24

Akhter-E_Tamanna 16-102

Md.Rajib Khan 16-134

Sameya Azad 16-152

Mohammad Rasel Mia 16-156

Date of Submission: 17 November 2011


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Auditing & Taxation Tyco international Scandal

November 17, 2011

Mohammad Salahuddin Chowdhury

Lecturer,

Department of Finance,

University of Dhaka.

Subject: Submission of report.

Dear Sir,

We are pleased to submit the report you have assigned to us. The report paper was to

prepare the term paper on the course named Auditing & Taxationcoursecode: F 209,

as a part of our academic activities. This is a report on Tyco International Ltds scandal for

fulfilling course work of BBA program and it is our pleasure to present such before you.

We have prepared this report based on the data gathered from Internet and newspapers. For

the preparation of the report, we have focused on the information that was found to be

reliable and valid.

We deeply regret for any inconvenience located in this report and we shall always be

available for any clarification required.

Sincerely yours,

Sameya Azad

On behalf of the group 14

Section: B

B.B.A. 16th Batch

Department of Finance

Faculty of Business Studies

University of Dhaka.

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This is high time we conveyed our deepest gratitude and sincere submission to the

Almighty ALLAH for giving us the opportunity to accomplish such an enjoyable task of

preparing this report in time.

We express our thanks to our dear course teacher Mohammad Salahuddin Chowdhury

for assigning us a report dealing with the Tyco International Ltds scandal. In this regard,

we would also like to thank ourselves for our good teamwork and successful team spirit.

Without co-operation and the support from each other, it would not be possible to prepare a

resourceful report.

The presentation of this formal study paper is of a great expectation in our BBA program

and we are quite happy to submit it duly applying that we think should have to be included.

Theoretical knowledge should be valued when it is successfully applied in practical

decision-making scenario. In this respect we found this report a great opportunity to deal

with some progressive methods.

So lastly we would again like to express our heartfelt thanks to our course teacher for

providing the theoretical knowledge and valuable guidelines related to management.

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Dennis Kozlowski worked all his life to get from the bottom to the top of TycoInternational Ltd. However, he picked up a lavish lifestyle that would soon be hisdestruction and bring him behind bars.

After purchasing many art pieces in 2002 the SEC started an investigation and accused himof failing to pay taxes of about $1 million dollars, but as the investigation proceeded thecase became more complicated as it turned out that CEO Dennis Kozlowski and CFO MarkSwartz have been looting Tyco International of more than $600 million. Examples of howthis was possible are following:

When Tyco found out about the investigation they fired people involved and also replaced10 of the top management positions to regain trust to the stockowner.Nevertheless the stock price has dropped 86% from $59.31 on 12/28/01 to $8.25 on7/25/02. Three years later in September 2005 Kozlowski and Schwartz found themselves incourt again after a mistrial in 2004 to face their sentence. They are charged for largelarceny, falsifying business documents and securities fraud. Both are convicted to serve aminimum of 8 and to 25 years in jail.

The biggest crime that happened here was that Kozlowski and Schwartz abused their powerof control to steal from and lie to the stockowners. The journal Business Week postedKozlowski as one of their TOP 25 CEOs in 2000. That is how good people thought hewas. The money that was used to buy houses and silly things like $6000 shower curtainsshould have been used to push the company further or given to the shareholders. Is thatworse than what the executives did in Enron? No, but bottom line is stealing is stealing.

They believed that Kozlowski was sharing the same ideas and goals that the companyrepresents as he has proven to them many times when he closed up million dollar deals thatmade a fortune for them. Instead he used the company funds like a private bank and spent itlike it was his money. The dishonesty of Kozlowski has caused more distrust to the public,and of course the stock to drop to a price that is worth virtually nothing compared to what itused to be. Also Tyco as a company had to endure many million dollar lawsuits and lost alot of money to that. I think Tyco did the right thing by replacing top management rightaway after the issue occurred. They hired Edward Breen as their new CEO, who invested alot of time and money to communicate to the public that Tyco International is operating inmany parts of the world and that they are trustworthy even though their former CEO failedto do so.

It may be very far away from having the trust of investors again, but they took a step in theright direction.

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C o n t e n t s

Contents..................................................................................................................................................3..................................................................................................................................................4Contents ....................................................................................................................................5

PAGES .................................................................................................................................5Contents ....................................................................................................................................5Contents ....................................................................................................................................5..................................................................................................................................................6..................................................................................................................................................7..................................................................................................................................................9Tyco International Ltds scandal ..............................................................................................9Overacts in year 2000 .............................................................................................................11Corporate scandal of 2002 ......................................................................................................12Tyco International Ltd............................................................................................................ 12Analysis of Financial Condition and Results of operations ..................................................12

................................................................................................................................................19

................................................................................................................................................20Bibliography ...........................................................................................................................21

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PAGES

Contents..................................................................................................................................................3..................................................................................................................................................4Contents ....................................................................................................................................5

PAGES .................................................................................................................................5Contents ....................................................................................................................................5Contents ....................................................................................................................................5..................................................................................................................................................6..................................................................................................................................................7..................................................................................................................................................9Tyco International Ltds scandal ..............................................................................................9Overacts in year 2000 .............................................................................................................11Corporate scandal of 2002 ......................................................................................................12Tyco International Ltd............................................................................................................ 12Analysis of Financial Condition and Results of operations ..................................................12................................................................................................................................................19................................................................................................................................................20Bibliography ...........................................................................................................................21


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Origin:

This report is written for Course no.F-209(Auditing &Taxation) which is the part of 4 th

semester 2nd year of B.B.A. program of Finance Department. Moreover report writing is an

important lesson of Auditing and Taxation course thus the report will work as a skill test of

us about report writing. This report is based on Tyco International Ltds scandal.

Objective:

The specific objectives aimed for this report are:

Know about one of the biggest scandal of corporate world TYCOs Scandal

How the corporate scandal occurs.

Who are responsible behind the scandals?

How these scandals affected our International market.

Scope of the report:

The proposed report is one of the biggest corporate scandal Tyco International Ltd.

Scandal.

Methodology:

Our report is based on Secondary Data from internet.

Limitations:

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There was no authorization letter with us when we went for collecting information to the

companies. At first they were not agreed enough to give information. We had to pursue

them for that time had passed and we could not form our report well. They think some

information is confidential enough to publish in any journal. As a result they did not give

us the information as details as we wanted. So we had to be satisfied by that information.

Those are the limitations we faced during the formation the report.

Type Public

Traded as NYSE:TYC

Industry Conglomerate

Founded 1960, incorporated 1962

Headquarters

Incorporation: Schaffhausen,SwitzerlandOperational/Corporate: Princeton,

New Jersey

ProductsSecurity Solutions, Fire ProtectionandFlow Control

Revenue $18.80 billion USD(2007)[1]

Operating

income$1,715 million USD (2007)[1]

Net income $1,742 million USD (2007)[1]

Employees 106,000 (2010)[2]

Website www.tyco.com

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http://en.wikipedia.org/wiki/Types_of_business_entityhttp://en.wikipedia.org/wiki/Ticker_symbolhttp://en.wikipedia.org/wiki/New_York_Stock_Exchangehttp://www.nyse.com/about/listed/quickquote.html?ticker=tychttp://www.nyse.com/about/listed/quickquote.html?ticker=tychttp://en.wikipedia.org/wiki/Conglomerate_(company)http://en.wikipedia.org/wiki/Schaffhausenhttp://en.wikipedia.org/wiki/Schaffhausenhttp://en.wikipedia.org/wiki/Switzerlandhttp://en.wikipedia.org/wiki/Princeton,_New_Jerseyhttp://en.wikipedia.org/wiki/Princeton,_New_Jerseyhttp://en.wikipedia.org/wiki/Pipeline_transporthttp://en.wikipedia.org/wiki/Pipeline_transporthttp://en.wikipedia.org/wiki/United_States_dollarhttp://en.wikipedia.org/wiki/United_States_dollarhttp://en.wikipedia.org/wiki/Tyco_International#cite_note-AR-0http://en.wikipedia.org/wiki/Earnings_before_interest_and_taxeshttp://en.wikipedia.org/wiki/Earnings_before_interest_and_taxeshttp://en.wikipedia.org/wiki/United_States_dollarhttp://en.wikipedia.org/wiki/Tyco_International#cite_note-AR-0http://en.wikipedia.org/wiki/Net_incomehttp://en.wikipedia.org/wiki/United_States_dollarhttp://en.wikipedia.org/wiki/Tyco_International#cite_note-AR-0http://en.wikipedia.org/wiki/Tyco_International#cite_note-1http://www.tyco.com/http://en.wikipedia.org/wiki/File:Tyco.svghttp://en.wikipedia.org/wiki/Ticker_symbolhttp://en.wikipedia.org/wiki/New_York_Stock_Exchangehttp://www.nyse.com/about/listed/quickquote.html?ticker=tychttp://en.wikipedia.org/wiki/Conglomerate_(company)http://en.wikipedia.org/wiki/Schaffhausenhttp://en.wikipedia.org/wiki/Switzerlandhttp://en.wikipedia.org/wiki/Princeton,_New_Jerseyhttp://en.wikipedia.org/wiki/Princeton,_New_Jerseyhttp://en.wikipedia.org/wiki/Pipeline_transporthttp://en.wikipedia.org/wiki/United_States_dollarhttp://en.wikipedia.org/wiki/Tyco_International#cite_note-AR-0http://en.wikipedia.org/wiki/Earnings_before_interest_and_taxeshttp://en.wikipedia.org/wiki/Earnings_before_interest_and_taxeshttp://en.wikipedia.org/wiki/United_States_dollarhttp://en.wikipedia.org/wiki/Tyco_International#cite_note-AR-0http://en.wikipedia.org/wiki/Net_incomehttp://en.wikipedia.org/wiki/United_States_dollarhttp://en.wikipedia.org/wiki/Tyco_International#cite_note-AR-0http://en.wikipedia.org/wiki/Tyco_International#cite_note-1http://www.tyco.com/http://en.wikipedia.org/wiki/Types_of_business_entity


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Tyco International Ltd. NYSE: TYC is a highly diversified global manufacturingcompany incorporated in Switzerland, with United States operational headquarters inPrinceton, New Jersey (Tyco International (US) Inc.). Tyco International is composed ofthree major business segments: Security Solutions, Fire Protection and Flow Control.

In June 2007, Tyco concluded a corporate separation that split the company into threepublicly independent companies: Covidien Ltd. (formerly Tyco Healthcare), TycoElectronics Ltd. (now TE Connectivity Ltd.) and Tyco International Ltd. (formerly TycoFire & Security and Tyco Engineered Products & Services (TFS/TEPS))

Net revenues by year

Year 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997

Revenue (in US$B) $18.8* $41.0 $39.3 $38.0 $36.8 $35.6 $34.0 $28.9 $22.5 $19.1 $6.6

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http://en.wikipedia.org/wiki/New_York_Stock_Exchangehttp://www.nyse.com/about/listed/quickquote.html?ticker=tychttp://en.wikipedia.org/wiki/Switzerlandhttp://en.wikipedia.org/wiki/United_Stateshttp://en.wikipedia.org/wiki/Princeton,_New_Jerseyhttp://en.wikipedia.org/wiki/Pipeline_transporthttp://en.wikipedia.org/wiki/Pipeline_transporthttp://en.wikipedia.org/wiki/Covidien_Ltd.http://en.wikipedia.org/wiki/Covidien_Ltd.http://en.wikipedia.org/wiki/TE_Connectivityhttp://en.wikipedia.org/wiki/New_York_Stock_Exchangehttp://www.nyse.com/about/listed/quickquote.html?ticker=tychttp://en.wikipedia.org/wiki/Switzerlandhttp://en.wikipedia.org/wiki/United_Stateshttp://en.wikipedia.org/wiki/Princeton,_New_Jerseyhttp://en.wikipedia.org/wiki/Pipeline_transporthttp://en.wikipedia.org/wiki/Covidien_Ltd.http://en.wikipedia.org/wiki/TE_Connectivity


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Tyco International Ltds scandal

Tyco is a global company, employing over 270,000 people, with $36billion in annual revenues, that manufactures, distributes and servicesproducts and systems for a broad spectrum of markets, with corebusiness segments in electronics, telecommunications, healthcare andspecialty products, fire and security services, and flow control. Prior toJuly 1997, and a merger with a Bermuda company, a current Tycosubsidiary, now named Tyco International (US) Inc., was Tycos main

operating company under the name Tyco International Ltd. (Mass.)(Former Tyco). Tyco has approximately 2,342 subsidiaries, includingnon-operating holding companies; the corporate headquarters staff ofTyco, with fewer than 400 people, is paid through a subsidiary namedTME Management Corp. (TME). Tyco itself, other than in itssubsidiaries, has fewer than 20 employees.

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During the period from on or about January 1, 1995, through September 9,2002, in the County of New York and elsewhere, intentionally engaged ina scheme constituting a systematic on-going course of conduct with intentto defraud ten and more persons, to wit, shareholders and regulators, andto obtain property, to wit money and securities, from ten and morepersons, to wit, Tyco International Ltd. (Bermuda) (Tyco), and itssubsidiaries and predecessors, as well as investors in, prospectivepurchasers of, and other acquirers of Tycos securities and debtinstruments by false and fraudulent pretenses, representations, andpromises, and so obtained property from one and more of such personswhile engaged in inducing and promoting the issuance, distribution,exchange, sale, negotiation and purchase of securities issued by Tyco, asfollows:

Tyco is a publicly-owned corporation, the shares of which are traded on the New York StockExchange. Prior to July 1997, and to a merger with a Bermuda corporation, a Tyco subsidiary,now named Tyco International (US) Inc., was Tycos main operating company, and was then a

corporation named Tyco International Ltd. (Mass.) (Former Tyco), that traded on the NewYork Stock Exchange. For purposes of this count, Tyco hereinafter includes, unless otherwiseindicated, Former Tyco. At all times during the scheme Tyco and its subsidiaries issued stockand debt instruments whose market value depended on the "market perception" of howvaluable Tyco was. Information material to market perception includes financial statementsissued by the corporation, filings by the corporation with the United States Securities andExchange Commission (SEC) and other regulatory bodies, public statements by corporateofficers, press reports, releases, and statements issued by the corporation, and reportsdisseminated by ostensibly independent analysts and credit rating agencies, all of which arerequired to be accurate and truthful.

Among the matters which Tyco, by its officers, reported to the public, and was required by lawto report publicly were

(1) The compensation paid to Tyco's directors and five highest paid executive officers,(2) The existence of loans outstanding to executive officers and directors, if in amounts greaterthan $60,000,(3) The sales of stock by executive officers and directors, and(4) Certain related party transactions between Tyco and its directors and officers.

Dennis Kozlowski worked all his life to get from the bottom to the top of TycoInternational Ltd. And when he reached the CEO position he was often compared to othergreat CEOs in history like Jack Welch. However, he picked up a lavish lifestyle that

would soon be his destruction and bring him behind bars.

After purchasing many art pieces in 2002 the SEC started an investigation and accused himof failing to pay taxes of about $1 million dollars, but as the investigation proceeded thecase became more complicated as it turned out that CEO Dennis Kozlowski and CFO MarkSwartz have been looting Tyco International of more than $600 million. Examples of howthis was possible are following:

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Over the years they have been giving themselves interest free loans from thecompany and then later on forgave themselves for it through Mark Schwartzfalsifying documents.

Dennis Kozlowski gave himself bonuses to repay the debt.They sold stocks atinflated prices.

When Tyco found out about the investigation they fired people involved and also replaced10 of the top management positions to regain trust to the stockowner.Nevertheless the stock price has dropped 86% from $59.31 on 12/28/01 to $8.25 on7/25/02. Three years later in September 2005 Kozlowski and Schwartz found themselves incourt again after a mistrial in 2004 to face their sentence. They are charged for largelarceny, falsifying business documents and securities fraud. Both are convicted to serve aminimum of 8 and to 25 years in jail.

The biggest crime that happened here was that Kozlowski and Schwartz abused their powerof control to steal from and lie to the stockowners. Given that Tyco was not a case like

Enron where the employees lost everything, it is still very serious. The journal BusinessWeek posted Kozlowski as one of their TOP 25 CEOs in 2000. That is how good peoplethought he was. The money that was used to buy houses and silly things like $6000 showercurtains should have been used to push the company further or given to the shareholders. Isthat worse than what the executives did in Enron? No, but bottom line is stealing isstealing. I believe Tyco has only did one thing wrong, trusting their CEO too much. Theybelieved that Kozlowski was sharing the same ideas and goals that the company representsas he has proven to them many times when he closed up million dollar deals that made afortune for them. Instead he used the company funds like a private bank and spent it like itwas his money. The dishonesty of Kozlowski has caused more distrust to the public, and ofcourse the stock to drop to a price that is worth virtually nothing compared to what it used

to be. Also Tyco as a company had to endure many million dollar lawsuits and lost a lot ofmoney to that.

Overacts in year 2000

On or about May 29, 2000, defendant Kozlowski obtained in excess

of $7,000,000 from Tyco for the purchase of property from Tycolocated at 610 Park Avenue in New York County.

In or about September 11, 2000, defendant Kozlowski caused amemorandum to issue to forgive the relocation loans for a list ofTyco employees that included himself and defendant Swartz.

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In or about September 2000, defendant Kozlowski told TycosDirector of Human Resources that the Board of Directors of Tycohad approved the forgiveness of over $56,000,000 in loans tohimself and other Tyco employees, and the "gross-up" of theirincome by more than $39,000,000.

In or about September 2000, defendants Kozlowski and Swartzauthorized a Tyco book entry forgiving loans previously booked asrelocation loans to Tyco employees aggregating in excess of$56,000,000.

In or about November 2000, defendants Kozlowski and Swartzcaused an illegal special bonus in excess of $8,000,000 to be paidto defendant Swartz.

Corporate scandal of 2002

Formerchairman and chief executiveDennis Kozlowskiand formerchief financial officerMark H. Swartz were accused of the theft of more than $150 million from the company.During their trial in March 2004, they contended the board of directors authorized it ascompensation.

During jury deliberations, juror Ruth Jordan, while passing through the courtroom,appeared to make an "okay" sign with her fingers to the defense table. She later denied shehad intended that gesture, but the incident received much publicity (including a caricature

in the Wall Street Journal), and the juror received threats after her name became public.Judge Michael Obus declared amistrial on April 2, 2004.

On June 17, 2005, after a retrial, Kozlowski and Swartz were convicted on all but one ofthe more than 30 counts against them. The verdicts carry potential jail terms of up to 25years in state prison. Kozlowski himself was sentenced to no less than eight years and fourmonths and no more than 25 years in prison. Swartz received the same sentence. Then inMay 2007,New Hampshire Federal District Court JudgePaul Barbadoro approved a classaction settlement whereby Tyco agreed to pay $2.92 billion to a class of defraudedshareholders represented by Grant & Eisenhofer P.A., Schiffrin, Barroway, Topaz &Kessler, and Milberg Weiss & Bershad.

Tyco International Ltd.

Analysis of Financial Condition and Results ofoperations

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http://en.wikipedia.org/wiki/Chairmanhttp://en.wikipedia.org/wiki/Chief_executivehttp://en.wikipedia.org/wiki/Dennis_Kozlowskihttp://en.wikipedia.org/wiki/Dennis_Kozlowskihttp://en.wikipedia.org/wiki/Chief_financial_officerhttp://en.wikipedia.org/wiki/A-okhttp://en.wikipedia.org/wiki/Mistrialhttp://en.wikipedia.org/wiki/Mistrialhttp://en.wikipedia.org/wiki/New_Hampshirehttp://en.wikipedia.org/wiki/Paul_Barbadorohttp://en.wikipedia.org/wiki/Paul_Barbadorohttp://en.wikipedia.org/wiki/Grant_%26_Eisenhofer_P.A.http://en.wikipedia.org/wiki/Grant_%26_Eisenhofer_P.A.http://en.wikipedia.org/wiki/Grant_%26_Eisenhofer_P.A.http://en.wikipedia.org/wiki/Chairmanhttp://en.wikipedia.org/wiki/Chief_executivehttp://en.wikipedia.org/wiki/Dennis_Kozlowskihttp://en.wikipedia.org/wiki/Chief_financial_officerhttp://en.wikipedia.org/wiki/A-okhttp://en.wikipedia.org/wiki/Mistrialhttp://en.wikipedia.org/wiki/New_Hampshirehttp://en.wikipedia.org/wiki/Paul_Barbadorohttp://en.wikipedia.org/wiki/Grant_%26_Eisenhofer_P.A.


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Our results for fiscal 2002 were adversely affected by: decreaseddemand, as a result of the overall economic downturn, particularly in thetelecommunications and electronics markets; the termination of ourpreviously announced plan to separate into four independent publiclytraded companies; rumors and negative publicity; the resignation of our

chief executive officer and chief financial officer; the replacement ofother members of our senior management; the indictment of formermembers of our senior management; concern regarding our ability tomaintain compliance with debt covenants and meet upcoming debtmaturities; and the announced investigation being conducted by theCompanys outside counsel. All of these factors affected employees,customers, vendors and investors. These effects are continuing. InJanuary 2002, our Board of Directors became aware of the first of manyunauthorized actions that ultimately led to the resignations of ourformer chief executive officer and chief financial officer and thetermination of our chief legal officer as well as the decision not to

renominate one of our directors. In September 2002, our former chiefexecutive officer, chief financial officer and chief legal officer were eachcharged with violating New York state criminal law as a result of theiractions. In December 2002, the former director was charged with, andpleaded guilty to, violating New York state criminal law as a result of hisactions. During the fourth quarter of fiscal 2002, we announced thehiring of a new chief executive officer, a new chief financial officer and anew chief legal officer, as well as other key executives, and alsoannounced the initiation of external and internal investigations.

The impact on the Consolidated Statements of Operations, Consolidated

Balance Sheets and Consolidated Statements of Cash Flow, as a result ofthe above adjustments, is as follows (in millions, except per share data).

The amounts previously reported are derived from the original Form 10-K for the year ended September 30, 2002 filed on December 30, 2002.

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Company separations

An announcement was made publicly on January 13, 2006, that the company wouldsubdivide into three smaller independent companies.

An official "Separation Management Team" was created to deal with all aspects of theseparation and to make it as smooth as possible for customers, employees, andshareholders. Bob Scott was announced as its leader.[12] Scott had joined Tyco in 2004.

On June 29, 2007, Tyco completed the share distribution separating the company into threewholly independent, publicly traded companies,[13][14][15] each with its own board ofdirectors, CEO, management staff, and financial structure.[16]

The three new companies became:

Covidien Ltd., formerly Tyco Healthcare

Tyco Electronics Ltd., now TE Connectivity

Tyco International Ltd., formerly Tyco Fire & Security and Tyco Engineered

Products & Services (TFS/TEPS)

Edward Breen, CEO of Tyco at the time of the split, announced that he would be stayingon as CEO of the newly structured Tyco International, overseeing TFS/TEPS.

Completing the share distribution, on June 29, shareholders received one common share

each of the two new companies, Covidien and Tyco Electronics, for every four commonshares held of the old Tyco International stock. That July 6, the new Tyco Internationalissued a one-for-four reverse stock split.

On September 19, 2011, Tyco International Ltd. announced once again that the companywould split into three businesses. ADT North America, to be incorporated in the UnitedStates, would deal with residential security. Other companies incorporated in countriesother than the United States would cover flow control and commercial fire and security.

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http://en.wikipedia.org/wiki/Shareholdershttp://en.wikipedia.org/wiki/Tyco_International#cite_note-11http://en.wikipedia.org/wiki/Tyco_International#cite_note-11http://en.wikipedia.org/wiki/Tyco_International#cite_note-12http://en.wikipedia.org/wiki/Tyco_International#cite_note-12http://en.wikipedia.org/wiki/Tyco_International#cite_note-13http://en.wikipedia.org/wiki/Tyco_International#cite_note-14http://en.wikipedia.org/wiki/Tyco_International#cite_note-2007letter-15http://en.wikipedia.org/wiki/Tyco_Healthcarehttp://en.wikipedia.org/wiki/Tyco_Healthcarehttp://en.wikipedia.org/wiki/TE_Connectivityhttp://en.wikipedia.org/wiki/ADT_Security_Serviceshttp://en.wikipedia.org/wiki/ADT_Security_Serviceshttp://en.wikipedia.org/wiki/Burglar_alarmhttp://en.wikipedia.org/wiki/Shareholdershttp://en.wikipedia.org/wiki/Tyco_International#cite_note-11http://en.wikipedia.org/wiki/Tyco_International#cite_note-12http://en.wikipedia.org/wiki/Tyco_International#cite_note-13http://en.wikipedia.org/wiki/Tyco_International#cite_note-14http://en.wikipedia.org/wiki/Tyco_International#cite_note-2007letter-15http://en.wikipedia.org/wiki/Tyco_Healthcarehttp://en.wikipedia.org/wiki/TE_Connectivityhttp://en.wikipedia.org/wiki/ADT_Security_Serviceshttp://en.wikipedia.org/wiki/Burglar_alarm


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Tyco is a global company, employing over 270,000 people, with $36billion in annual revenues, that manufactures, distributes and servicesproducts and systems for a broad spectrum of markets, with corebusiness segments in electronics, telecommunications, healthcare andspecialty products, fire and security services, and flow control. Prior toJuly 1997, and a merger with a Bermuda company, a current Tycosubsidiary, now named Tyco International (US) Inc., was Tycos mainoperating company under the name Tyco International Ltd. (Mass.)(Former Tyco). Tyco has approximately 2,342 subsidiaries, includingnon-operating holding companies; the corporate headquarters staff ofTyco, with fewer than 400 people, is paid through a subsidiary named

TME Management Corp. (TME). Tyco itself, other than in itssubsidiaries, has fewer than 20 employees.

Compensation amounting to millions paid to executive officers, loans extended toexecutive officers which were later forgiven, related party transactions, certain executivesutilizing Tycos corporate resources to fund personal ventures and property acquisitions, toincrease their own personal wealth.The first trial of Kozlowski and Swartz, who areaccused of looting the company of $600 million, ended in a mis-trial in April 2004.Prosecutors retrying the men say they'd like to begin proceedings in September 2004.

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Bibliography

http://www.forbes.com http://news.findlaw.com/hdocs/docs/tyco/nykozlo

wski91202ind.pdf

http://www.tyco.com

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http://www.forbes.com/http://news.findlaw.com/hdocs/docs/tyco/nykozlowski91202ind.pdfhttp://news.findlaw.com/hdocs/docs/tyco/nykozlowski91202ind.pdfhttp://www.tyco.com/http://www.forbes.com/http://news.findlaw.com/hdocs/docs/tyco/nykozlowski91202ind.pdfhttp://news.findlaw.com/hdocs/docs/tyco/nykozlowski91202ind.pdfhttp://www.tyco.com/

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