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Politics and Activism

The Top 5 Frauds Of The 2000s

America's apathetic trend toward financial scandal.

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The Top 5 Frauds Of The 2000s

We see it everywhere. It's featured in Netflix specials, TED Talks, movies, and constantly dominates news networks. There's no denying that our culture has a fascination with fraud. Time and time again we have seen big businesses in corporate America succumb to their own greed and end up in financial scandals of epic proportion. And what is interesting about how the public treats these scandals is that each time one is uncovered, people are utterly shocked. They react as if it is the first time they have ever seen such blasphemous wide-scale white collar crime.

In reality, these schemes are often nothing unique in design or innovative in their methods of financial manipulation. People just aren't paying attention. So while we common folk may not understand exactly how massive accounting fraud and intricate Ponzi schemes work in their entirety, we can certainly look back at some recent examples so that we know what this monkey business looks like the next time we see it.

1. Enron

Ah, you've got to pay homage to the classics. Enron was a Texas-based energy company that dominated the market from the mid-80's up until 2001 when the fraudulent activities its management and partner banks were involved in finally caught up with it. Netflix has a particularly interesting documentary called Enron: "The Smartest Guys in the Room" for full details on how the scandal went down.

2. Bernie Madoff

This Ponzi scheme was the largest to ever be committed by an individual to date. Former NASDAQ chairman Bernard Madoff would have most likely continued in his fraudulent business, too, had it not been for his confession to his son that ultimately led to federal investigation in 2008. ABC is currently filming a miniseries called "Madoff" about the life of the mogul-turned-felon.

3. Lehman Brothers

Another financial institution caught up in the fraudulent housing market bubble was the multi-billion dollar investment bank, Lehman Brothers. In 2008, the bank filed for bankruptcy--making it the largest bankruptcy in history. Despite the obvious foul play involved in the bank's demise, the SEC never officially filed charges against Lehman Brothers. In fact, none of the bank's executives or outside auditing partners at Ernst and Young were ever prosecuted for their crimes.


4. MF Global


Led by former Goldman Sachs Chairman, Jon Corzine, MF Global was a brokerage firm that famously went bankrupt in 2011. Although over $1 billion in assets disappeared into thin air, no SEC or DOJ charges were ever officially filed against the company. Regardless of a lack of legislative judgement, the business was found undoubtedly guilty of massive fraud in the court of public opinion. Frontline provides a compelling look into the short-lived company with a special called "Six Billion Dollar Bet."

5. Fannie Mae

Although the mortgage firm has still not been fully prosecuted by the SEC on the grounds of full-blown securities fraud, the company was forced to pay over $400 million in fines in 2006 for the misstatement of financial statements, and was part of the infamous bailout of 2008 and is currently still owned by the US government. The movie "The Big Short" (now in theaters) illustrates the macrocosm of the housing bubble and how it eventually came crumbling down.

Now you know the big five of the financial fraud greatest hits of the 2000s and have the resources to learn a little more about them without drowning in big business lingo. With almost a decade since the last major financial crisis, America is at risk of falling back into our habitual pattern of apathy towards the financial sector. So, keep your eyes peeled, because we're due for the next "shocking scandal" any day now.

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This article has not been reviewed by Odyssey HQ and solely reflects the ideas and opinions of the creator.
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