America's Most Notorious Corporate Criminals

Almost instantly, they went from sporadic mentions on the business news outlets to the front page - the white-collar criminals who defrauded their way to short-term riches and long-term imprisonment. While they weren't common street thugs who shed their victims' blood, they did cost our justice system untold man-hours and dollars - to say nothing of the money they stole in the first place. Let's look at the current whereabouts of some of America's most notorious gray-flannel-clad fraudsters.

SEE: Investment Scams

Dennis Kozlowski
For sheer overweening self-confidence, it's hard to beat Dennis Kozlowski. He served as CEO of Tyco, a company that began as a humble manufacturer, but transmuted into an all-over-the-map conglomerate under his tenure. At its acquisitive zenith in the 1990s, Tyco was buying a couple of companies a week. "Serial purchasing" is something of a red flag among prudent investors, but Kozlowski's crimes were of a more personal variety. He was charged with "misappropriation of corporate funds," which is what you do when you reach into the petty cash drawer to buy lunch, only Kozlowski did it on a galactic scale.

As the one who signed the checks, it was easy for Kozlowski to authorize purchases like a $30 million apartment. However, by accessorizing it with $6000 shower curtains and $15,000 umbrella stands, he was essentially getting down on his knees and begging shareholders to hate him. The coupe de grace was his wife's birthday party, which wasn't held at the neighborhood restaurant chain, but rather half a world away in Sardinia. They billed it as a "shareholder meeting," meaning Tyco would pick up half the tab. Costing $2.1 million, the party featured toga-clad waiters hand-feeding grapes to the guests, and an ice replica of Michelangelo's "David" that, literally, urinated premium vodka. Least conscionably of all, Kozlowski flew in Jimmy Buffett as the night's entertainment.

In 2005, Kozlowski was convicted of grand larceny, conspiracy and securities fraud. He'd received $81 million in unauthorized bonuses, among other payouts. Those are state crimes, which means that Prisoner 05A4820 is serving his time at Mid-State Correctional Facility near Utica, New York.

The story does have a happy ending, though. Five years after the fact, the guest of honor at The-Party-That-Would-Have-Made-Caligula-Blush, made her lone visit to Kozlowski in prison - with some real estate developer's ring on one hand, and divorce papers in the other.

Jeff Skilling
The Enron scandal is the definitive corporate fraud story of the past quarter-century, even though the narrative can be hard to follow beyond "Enron stole." To recap, Enron began its (legitimate) ascent by buying and building pipelines and power plants. Most utilities have to take on a lot of debt to finance such operations, as did Enron. However, most utilities don't take the additional, illegal step of creating offshore, special purpose entities specifically to hide any records of overleveraging and losing money. With those SPEs in play, Enron's inaccurate and opaque financial statements looked stellar. The previously unheralded company shot its way into the number six position on the Fortune 500, rubbing shoulders with Microsoft, IBM and other companies that do something tangible.

Enron's chairman and CEO, Ken Lay and Jeff Skilling, respectively, tried to cover themselves in the courtroom with the always tenuous "the feds pressured us into confessing" defense. Lay conveniently died between verdict and sentencing, but Skilling was ordered to serve 24 years and pay a $630 million fine. He now answers to the number 29296-179 at Federal Correctional Institution, Englewood, a minimum-security facility outside Denver. Skilling recently celebrated, if that's the right verb to use, his fifth anniversary behind bars. He'll be free in February of 2028, when this article will be old enough to legally drive a car. Skilling himself will be 74.

To put that in perspective, that's only a year older than the final criminal on our list is today. For sheer magnitude of malfeasance, it's hard to trump the legendary Bernie Madoff.

Bernie Madoff
Madoff began his Wall Street career portentously. In 1960, he created a firm that traded in penny stocks. By the 1990s, the legitimate operations of Bernard L. Madoff Investment Securities made money by processing orders for other brokerage firms. However, it was Madoff's investment management operations and promise of ungodly returns for his clients that led to scandal. Reduced to the simplest possible level, Madoff bought and sold securities for his own account, before placing similar orders for clients (which would have predictable effects on those securities' prices.) That's called front running and it violates federal law. Madoff also paid old clients with new clients' money - the textbook definition of a Ponzi scheme.

By the time SEC investigators had finished calculating the damage, it was clear that Madoff had torn 10-digit holes in one institutional investor after another. Those were mostly investment management firms and foreign banks, each of which represented the investments of thousands of ordinary people. The Wall Street Journal estimated total losses of $27 billion, or the annual gross domestic product of Latvia.

Madoff was sentenced in June of 2009. As of this writing, he's completed 1/60 of his sentence. As Prisoner 61727-054, Madoff is serving at the Federal Correctional Complex in Butner, North Carolina. He'll get out after he turns 201, on Nov. 14, 2139, which is the same day robots are expected to achieve sentience.

The Bottom Line
Not to excuse them, but many blue-collar thieves need the money. Many of us may never understand why some people, who are rich beyond comprehension, still risk their freedom so they can steal money they don't need. However, it's nice to know that some of these avaricious moguls have been stripped of their luxuries and are deservedly behind bars.

More From Investopedia

Quiz: How well do you know India's economy?

Question 1

Which of these products is India the world's largest producer of?

Poll Choice Options
  • Wheat
  • Rice
  • Milk

Latest News

  • Earnings lift S&P 500, Nasdaq; S&P's best week since July

    U.S. stocks ended a holiday-shortened week with mostly modest gains on Thursday, though the S&P 500 notched its biggest weekly advance since July as Morgan Stanley and General Electric rallied after strong results. The two were the latest to post earnings that topped expectations, helping to lift the S&P 500 and the Nasdaq to their fourth straight daily advance. Tech bellwethers Google and IBM fell on disappointing figures and limited the broader market's gain. IBM's slide pushed the Dow …

  • Mapping the 11 Most Expensive Houses Ever Sold in America

    Nine-figure listings have been (relatively speaking) flying off the proverbial shelves lately, what with Connecticut's Copper Beech Farm selling for $120M last week and L.A.'s long-unsold Fleur de Lys going for $102M cash in late March. Both of these... …

  • Get a Janitor's View of Versailles in These Unprettied Photos

    Photo via Messy Nessy Chic The Palace of Versailles looms so large in humanity's understanding of unrestrained splendor that it has inspired a whole host of sorry knockoffs. And while all that's been seen of the most famous American Versailles... …

  • Le Corbusier's Villa Savoye Gets Irreverently Suburbanized

    Image via Architizer The landmarked and preserved architectural masterpieces of the world would undoubtedly look very different if they were subject to actual inhabitants. Taking the dissonance between aesthetic temples and lived-in homes and prying it wide open, the runner... …

  • For Goldman Sachs and Morgan Stanley, boring is beautiful
    For Goldman Sachs and Morgan Stanley, boring is beautiful

    The results underscored how businesses viewed as stodgy before the financial crisis are becoming critical drivers of earnings for investment banks now. Goldman’s investment management, stock underwriting and merger advisory businesses logged big gains. Morgan Stanley did well in those areas, as well as in wealth management and bond underwriting. Morgan Stanley was the biggest stock underwriter globally in the first quarter, while Goldman earned the most fees from merger advisory, Thomson …


  • This might well be India’s biggest Ponzi scam

    It was just too good to be true. Ashok Khital, 45, displays every symptom of a man who knows he's been conned. …

  • India's star studded football league

    High and mighty including Sachin, Salman & Sun Group buy ISL teams …

  • Leaderspeak with Rajesh Janey

    Rajesh Janey, President - India & SAARC, EMC shares many firsts in his life. …

  • Power Hungry

    Gujarat has power round-the-clock. Most other states do not. Why this will matter in the general elections. …

  • Etcetera

    The most keenly watched contest of the current general election will be the one for the Varanasi parliamentary seat, where the Bharatiya Janata Party's prime ministerial hopeful Narendra Modi squares off ... …

  • Economy vs Democracy

    As the country gets election fever, cash comes out of mattresses and turns into liquor, gifts, and food. But it is not bad for the health of the economy, reports Sarika Malhotra from the trenches. …

  • Bracing for Challenges

    Raghuram Rajan is preparing to deal with concerns that may arise when a new government takes charge. …


  • Most Actives
    Most Actives
    NamePriceChange% Chg
  • Price % Gainers
    Price % Gainers
    NamePriceChange% Chg
  • Price % Losers
    Price % Losers
    NamePriceChange% Chg
    Recent Quotes
    Symbol Price Change % ChgChart 
    Your most recently viewed tickers will automatically show up here if you type a ticker in the "Enter symbol/company" at the bottom of this module.
    You need to enable your browser cookies to view your most recent quotes.
  • Recent Quotes News

      Sign-in to view quotes in your portfolios.