Penn Square Bank & Down Corning Bankruptcy Essay Example for Free

Penn Square Bank Down Corning Bankruptcy Essay According to Norm Bowie, â€Å"sometimes being moral enhances the bottom line rather than reduces it† (Hartman, 2005, p108). Unfortunately, in the instances of Penn Square Bank and the Dow Corning bankruptcy, that may not have been the case. The following will examine the particulars of these situations and discuss the ethical issues present for each. Penn Square Bank Penn Square Bank was a small bank that played a large role in the Oklahoma banking crisis of the early 1980s. In an effort to maximize on the profits of the booming oil industry, the upper management of Penn Square Bank cut corners in several areas of its new lending division. Documentation to support million-dollar loans became lax. Collateral valuation and revenue recognition was severely over estimated without verification of the documentation to support such claims. Loan contracts were with casual deals and unspecific terms. Credit was extended based upon unverified personal letters paid for by the client. These documentation errors led to loans not properly secured (Caskey, 1985). In addition, Penn Square was more and more money, which facilitated errors in revenue recognition as the bank accepted over estimated valuation claims without requiring loan or interest payments. Thus, on paper the bank looked successful without ever possessing the funds to support its lending endeavors. Finally, credit was extended without true verification of asset valuation or proper documentation, and re-extended when the client could not produce the payments necessary to support the lofty loans (Caskey, 1985). Each of Penn Square Bank’s actions represents a form of financial statement fraud, which led to its downfall in 1982. According to Fraud Examination, there are three ways to deter financial statement fraud: (1) reduce the pressure to commit the fraud, (2) reduce the opportunity to commit the fraud, and (3) reduce the rationalization of the fraud (Wells, 2005). However, in this instance, most if not all of the fraud committed can be attributed to demanding goals set by Penn State Bank owner, Bill Jennings. As explained by Hartman, the â€Å"driving force† of â€Å"profit maximization† created a business environment to facilitate fraud (2005). Because profit was the sole motivator, documentation was inadequate, collateral valuation and revenue recognition was overstated, and credit extension was unverified and inferior. Instead,  Penn Square Bank should have considered the following measures: †¢An oversight or review board should be been established to oversee verification of credit or collateral valuation and determine the risk associated with each loan. †¢Documentation requirements should have been heavily enforced and maintained by the review board. †¢Contract and loan deals should have been regulated to the office with strict documentation requirements. †¢Disclosures should have been made regarding the lack of loan and interest payments. †¢Asset valuation and revenue recognition should have been accurately portrayed to investors, clients, and potential buyers. †¢Upper management should have established company ethical standards and enforced these standards with strict consequences for violation without exception. Unfortunately, all the measures to deter fraud that should have been considered were undermined by the owner’s overwhelming demand for success. Thus, Jennings’ need to maximize profits and increase sales created the pressure, opportunity, and rationalization to commit each action of fraud. Dow Corning Bankruptcy Dow Corning Corporation is the big name in silicone and silicone-based material production. But in 1995, the company filed for Chapter 11 bankruptcy to protect itself from lawsuits regarding their silicone-based breast implants. Some advocated that the action was an effort to â€Å"avoid compensating women for their injuries† (Book review, 1996, p7). However, according to Hartman, Chapter 11 bankruptcy is intended to protect companies from creditors while it undergoes restructuring in an effort to stave off liquidation. By doing so, the company continues business, pays taxes, and provide jobs but is allowed time to reorganize to triumph over its economic hardship (Hartman, 2005). The ethical challenge is to use Chapter 11 as it is intended – as a restructuring tool to avoid losing everything – rather than file for Chapter 11 as a way of cheating its creditors out of owed money. Hartman suggests that what is ethical in regard to bankruptcy is to go beyond what the laws require and uphold the debt agreements made with creditors (Hartman, 2005). Dow Corning seemed to have that same perspective. Nine years later the company emerged from bankruptcy after settling the lawsuits for a payout of $3.3 billion over the next 15 years (Arndt, 2004). During the time under Chapter 11, the company reorganized  itself to refocus silicone production to develop fabrics, materials, and pharmaceutical products (Arndt, 2004). These sales and expanding markets will help Dow Corning to pay its debts to the 300,000 women named in the settlement (Sissell, 2004). Thus, Dow Corning is Chapter 11 bankruptcy free but still upholding its ethical obligation to the wronged party and its creditors. Although Dow Corning’s actions following the Chapter 11 emergence was ethically sound, its actions leading to the filing was anything but. Problems with Dow Corning’s silicone breast implants began as early as 1984 when they lost a lawsuit claiming the implant caused medical illness such as autoimmune disease. During the investigation for this lawsuit, lawyers found evidence showing Dow Corning executives were aware of complaints from doctors, concerns about the lack of long-term testing, and cases of the implant bursting during surgery. In addition, the study that supposedly proved the effectiveness and safety of the product revealed detrimental long-term effects on the animals under experimentation (Book review, 1996). However, throughout all the breast implant concerns, Down Corning continued to advocate the safety of their product going as far as to hire high profile and extremely expensive teams of legal and public relations specialists. In addition, allegations were present of executives attempting to destroy damning internal documents suggesting upper management was trying to cover up its liability in the claims. The 1984 lawsuit found Dow Corning guilty of fraud and deceit stating the company provided inferior and incomplete information by understating the risks to make an informed decision (Book review, 1996). More important, it revealed the unethical behavior of the executives and company as a whole.

A Mothers Biggest Fair :: Essays Papers

A Mothers Biggest Fair One spring afternoon a mother met her greatest fear head-on. Crystal Beck and her three-year-old son Travis were shopping for a new spring and summer wardrobe at a local mall. The mall was very hectic for the middle of the afternoon and to make matters worse Crystal had forgotten her sons stroller at home after taking him for a walk earlier that day. She had told her inquisitive son to say by her side. After visiting a few stores Crystal began to notice that Travis was becoming very anxious. So she made the decision to finish her son’s shopping in JC Penney at the far end of the mall, the two made their way to the children’s clothing section located on the third floor. As Crystal searched through the cluttered racks looking for the perfect outfits for her son, still glancing back at Travis who was looking through a bin of stuffed toys. She looked back to the rack for a split second to find the size she needed, and when she looked back up to check on her son he was gone. Crystal began calling his name, waiting for a response, no response ever came. She called again, but louder this time â€Å"Travis, where are you?† With every call for her son her heart began to beat fast and harder inside of her chest. She could feel herself beginning to tremble and shake, her vision became gray and distorted, she then began running though the store call her son and crying uncontrollably. A salesperson stopped her to try to calm her down and find out what had happened. Crystal explained to her still crying and shaking what had happened. The salesperson assured her not to worry, that he would be found. The girl notified security for the store, they brought Crystal to their office and asked for a description of the boy. She told them that he was a three years old boy, with blonde hair and blue eye, and standing 36 inches in height. He was wearing a blue baseball cap, a red long sleeved shirt, blue jeans, and a pair of white Reebok sneakers. When she was done with the description of her son the security officer offered her a glass of water, but she refused it. Her stomach felt as if there was a solid piece of metal lying at the bottom of it.

Bullying and the effects on the individuals Essay

Abstract The purpose of this paper is to explain what is bullying and the consequences of bullying. Bullying is where the bullier intentially causes physical harm or emotional stress to the victim. Bullies are angry and aggressive and dominate their victims and choose their targets by weakness and vulnerability and the victim is non dominant and usually does not fight back. There are severe warning signs that this is not a normal behavior and usually starts as a child and can still be a behavior done in adulthood. There are four different types of bullying and several descriptive behaviors. Bullying can lead to severe self-esteem issues. Aggressive behavior, dominant individual who abuses power by threating less dominant individual. Behavior is repeated or has potential to become repetitive over time. Bullying includes making threats spreading rumors, attacking someone or seclusion. This can be in person or anonymously by being a cyber-bully. This is important because bullying or being bullied appear to indicate that something is wrong and children who experience bullying either as aggressor or a victim need help. Bullying start as a child and without help it can grow into a big issue to deal with as an adult. Types There are three most common types of bullying and numerous tactics used when targeting their victims. Bullies intend to harm their victims with power imbalance. Power imbalance is crucial for the bully because their victim  cannot defend themselves. Power difference can be age, size, or strength. The victim as a result can feel weak, small, vulnerable, scared and dumb. There is typically more than one time that the bully will attack there same victim. Weather it is the same act or different behaviors on the victim. The third aspect on bully behaviors is the intentions to cause harm another person. The bully harasses people on purpose. Their behavior is not a â€Å"joke† or accident. The victim feels embarrassed, ashamed, angry, or scared. There are different forms of bullying; physical, verbal, cyber and relational aggression. Physical involves hitting, kicking, pushing, tripping, stealing or breaking property. Verbal abuse hurts the victim emotionally with words. Name calling, threating, yelling, intimidation and laughing. Relational uses other people to hurt their victims. This is more hurtful to some people because their friends are talking behind their back. The bully spreads rumors and gossip around. The last form is cyberbullying which is done with improved technology. This can be over the internet, email, text or social media. The bully can interact relational and verbal forms. Name calling, insults and lies or threats can lead to physical harm to the victim. This can happen 24/7 and anonymously. So it is harder to find out who is the bully. There are many influences that the bully has and that is the reason why the bully has certain behaviors. Gender, orientation, environment, family problems, race or developmental problems. The bully usually has anger issues and experiences some type of abuse. The person takes out their feelings on someone who can or will not fight back. The bully may be physically and verbally abused by parents or older siblings. So when they are around someone who is not a threat they tend to do the same abuse to the victim to feel superior and worthy. The parents may have substance abuse, emotional issues, low self-esteem, single parent household and many other reasons. The family is not connected and bad communication. Lack of rules may also play a role. The victims have low self-esteem because they feel powerless. They listen and believe what is said to them and about them. They may feel helpless,  hopeless hurt non worthy and have negative outcomes, anxiety and depression. These can lead to substance abuse, drinking and lack of motivation, eating disorders and increase risk of suicide. These are main of bullying. Conclusion In conclusion bullying is a nationwide problem and it has major problems that affect another human being. This usually starts as a child and never ends without proper treatment. There is a behavior problem that is not normal to intentially cause harm to another person. there are many factors that influence the bully behavior. The victim as a result has low self-esteem. Depression and anxiety. The dominant and less dominant parties need and is recommended to get counseling to reduce long term constiquences. The improved bullying is done with updated technology and can remain unknown. References Kimble, D. and Colman, M (1995): Biological aspects of behavior, Longman Publishers, available at http://www.le.ac.uk/psychology/amc/ Kuykendrat, S. (2012) Ph D.Bullying Santa Barbra: ABC-clio. Zastrow, C. H.& Kirst-ashmand K.K. (2010) Understanding human behavior and the social environment. (8th ed ) Belmonth, CA brooks/cole http://www.stopbullying.gov/what-is-bullying/rel

Paramagnetism Definition and Examples

Paramagnetism refers to a property of certain materials that are weakly attracted to magnetic fields. When exposed to an external magnetic field, internal induced magnetic fields form in these materials that are ordered in the same direction as the applied field. Once the applied field is removed, the materials lose their magnetism as thermal motion randomizes the electron spin orientations. Materials that display paramagnetism are called paramagnetic. Some compounds and most chemical elements are paramagnetic under certain circumstances. However, true paramagnets display magnetic susceptibility according to the Curie or Curie-Weiss laws and exhibit paramagnetism over a wide temperature range. Examples of paramagnets include the coordination complex myoglobin, transition metal complexes, iron oxide (FeO), and oxygen (O2). Titanium and aluminum are metallic elements that are paramagnetic. Superparamagnets are materials that show a net paramagnetic response, yet display ferromagnetic or ferrimagnetic ordering at the microscopic level. These materials adhere to the Curie law, yet have very large Curie constants. Ferrofluids are an example of superparamagnets. Solid superparamagnets are also known as mictomagnets. The alloy AuFe (gold-iron) is an example of a mictomagnet. The ferromagnetically coupled clusters in the alloy freeze below a certain temperature. How Paramagnetism Works Paramagnetism results from the presence of least one unpaired electron spin in a materials atoms or molecules. In other words, any material that possesses atoms with incompletely filled atomic orbitals is paramagnetic. The spin of the unpaired electrons gives them a magnetic dipole moment. Basically, each unpaired electron acts as a tiny magnet within the material. When an external magnetic field is applied, the spin of the electrons aligns with the field. Because all the unpaired electrons align the same way, the material is attracted to the field. When the external field is removed, the spins return to their randomized orientations. The magnetization approximately follows Curies law, which states that the magnetic susceptibility χ is inversely proportional to temperature: M χH CH/T where M is magnetization, χ is magnetic susceptibility, H is the auxiliary magnetic field, T is the absolute (Kelvin) temperature, and C is the material-specific Curie constant. Types of Magnetism Magnetic materials may be identified as belonging to one of four categories: ferromagnetism, paramagnetism, diamagnetism, and antiferromagnetism. The strongest form of magnetism is ferromagnetism. Ferromagnetic materials exhibit a magnetic attraction that is strong enough to be felt. Ferromagnetic and ferrimagnetic materials may remain magnetized over time. Common iron-based magnets and rare earth magnets display ferromagnetism. In contrast to ferromagnetism, the forces of paramagnetism, diamagnetism, and antiferromagnetism are weak. In antiferromagnetism, the magnetic moments of molecules or atoms align in a pattern in which neighbor electron spins point in opposite directions, but the magnetic ordering vanishes above a certain temperature. Paramagnetic materials are weakly attracted to a magnetic field. Antiferromagnetic materials become paramagnetic above a certain temperature. Diamagnetic materials are weakly repelled by magnetic fields. All materials are diamagnetic, but a substance isnt usually labeled diamagnetic unless the other forms of magnetism are absent. Bismuth and antimony are examples of diamagnets.