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Waste Management Founded
Waste Management, a North American waste management, comprehensive waste, and evironemental service company was founded on this day in Houston, Texas -
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Cooking the Books
Between these years, Waste Management's executive officers began "cooking" the books by not recording expenses necessary to write off the costs of unsuccessful and abandoned landfill development projects; establishing inflated environmental reserves (liabilities) in connection with acquisitions so that the excess reserves could be used to avoid recording unrelated operating expenses, improperly capitalizing a variety of expenses; failing to establish sufficient reserves (liabilities). -
Upset with Waste Management
The new CEO of Waste Management ordered a review of the companies accounting practices. Thus leading to the restatement of the company's financial records. -
Restatement
In 1998 Waste Management restated its 1992-1997 earnings by $1.7 billion, making it the largest restatement in history. -
Stockholders Reaction
When the news became public the shareholders of Waste Management lost more than $6 billion dollars. Their stocks had plummeted more than 33%. -
Merger
Waste Management merged with USA Waste Services, Inc. USA Waste Services CEO John E, Drury remained the chairman, and CEO position of the new merged companies. -
Class Action Lawsuit
A class action lawsuit was filed against Waste Management and certains officers for issuing false statements -
Settling
Waste Management paid $457 million to settle a shareholder class-action suit . The SEC fined Waste Management's independent auditor, Arthur Andersen, US$7 million for its role. -
Settling the Scandal
Officers were accused of making "the financials look the way we want to show them." The top officers , without admitting any guilt, settled with the federal government for 30.8 million dollars.
