This is IN THE NEWS in VOA
An individual, a company and an
industry were all in the news this week for reasons unrelated except for the
idea of dishonesty.
individual was seventy-year-old Bernard Madoff. The New York money
manager is accused of cheating investors around the world. Officials say the
losses, by his own estimate, were at least fifty billion dollars.
He is accused of a Ponzi scheme.
Brad Garrett, a former federal agent, explains how it works.
BRAD GARRETT: "Taking in the
money from new investors, and paying it out to the old investors as income.
And, as long as you have new money coming in, it works well."
it is illegal. Charles Ponzi was an Italian immigrant in the United States. He went
to prison in the nineteen twenties after he cheated thousands of investors. He
promised high returns in a short time.
Bernard Madoff (pronounced MAY-doff) provided small but
continual profits for his investors. He was well known in Wall Street finance
-- a former chairman of the NASDAQ Stock Market.
say the operation collapsed when the economic downturn caused some investors to
demand about seven billion dollars back.
The Securities and Exchange Commission
is investigating why it did not take action against him until now. Accusations of
wrongdoing had repeatedly been brought to its attention. Experts say possible
victims, including international banks and movie maker Steven Spielberg, are
not likely to get much back.
This week, the German engineering
company Siemens pleaded guilty in Washington to violating the Foreign Corrupt
Practices Act. That law makes it a crime for Americans and companies traded on
United States markets to pay bribes in return for business. Investigators say
Siemens paid one and a half billion dollars in bribes to government officials
in Asia, Africa, Europe, the Middle East and Latin America.
Now, Siemens has agreed to pay a
similar amount in fines and other punishments. Cases were brought by the Justice
Department, the Securities and Exchange Commission and the Munich Public
Prosecutor's Office. Eight hundred million dollars of the money will go to
United States authorities -- a record for such a case.
Siemens cooperated extensively and admitted
to acts like falsifying its records. But it did not plead guilty to bribery. That
could have kept it from getting United States government contracts.
finally, this week also brought a ruling that anti-tobacco activists in the
United States called historic. The Supreme Court cleared the way for lawsuits
against tobacco companies accused of dishonest advertising for so-called light
case grew out of a lawsuit brought by three people in the state of Maine. They
accused cigarette makers of hiding information that "light" or
"low tar" cigarettes are just as dangerous as other cigarettes.
The companies argued that a federal law bars
such claims under state law. The Supreme Court was divided five to four, but the
justices decided that smokers may sue under state consumer-protection laws.
that's IN THE NEWS in VOA Special English, written by Brianna Blake. I'm Steve