Justice Ever Apologize To Arthur Anderson?

Chicagoans still remember the Bush Adm curiously giving hometown accounting giant Arthur Andersen the “death penalty” for involvement in the Enron scandal while other firms skated then as now for auditing whoppers.

I’ll sure remember the gasps in my downtown office when the news was read over the radio and everyone knew literally 85,000 people in 84 countries (10K in Chicago alone) would be out of work … just like that. Two decades later, the WSJ recently ran a piece maintaining Arthur Andersen “remains a punchline for many” while “some prefer to remember it as an influential institution deserving respect.” Well, sure. At the time, Chicago-based AA was arguably THE best among the so-called “Big Five.” And, especially since what is now the “Big Four” auditing firms have been allegedly involved in corporate scandals since but never forced to close shop as AA was on August 31, 2002.

Not that Arthur Andersen didn’t botch the Enron auditing that hurt an awful lot of people around the country. Still, a massive fine was widely expected at the time and AA, in fact, had signaled it had plenty of cash stashed away to pay the piper (it’s 2001 revenue alone was $9 billion). But, no. The Bush people wanted to “set an example” & insisted on pursuing criminal liability. As the WSJ recalls, a Houston jury convicted the firm for obstructing the gov’t’s investigation into Enron by shredding thousands of records & deleting tens of thousands of email messages that were arguably “common practice” in the industry at the time. The US Supreme Court in 2005 unanimously overturned the criminal conviction citing precisely that common practice, but too late for those whose careers as well as lives that were altered. Did Justice ever apologize?

Davd Soul