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Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: BelowTheCrowd who wrote (167282)	7/2/2002 6:03:58 AM
From: Amy J	Read Replies (1) \| Respond to of 186894

Michael, thanks for the link. I must have misread the blurb. RE: proposals Intel operates at a very squeaky clean level, but for those companies that don't, if boards of companies really wanted to make sure no corruption occurs, they would put an internal person on the board that's below the officer level. Who discovered there was something wrong at Enron? An independent board member? No. It was an internal non-officer Enron employee, of course. Who catches a "status" problem before it became a disaster? Boards are really too far away from a company to really see if anything is amiss, until it becomes too late to fix. I didn't see anything wrong with the SEC's proposal, though one problem could be, I'm told it's generally assumed a CEO is in the pocket of the board that selects them. A contact of mine was one of the largest shareholders at a startup where the board brought in this fancy wheeler and dealer type of CEO that had no integrity. Gave the CEO millions to come and millions when he left, and the CEO screwed all of the existing shareholders on his way out in exchange for, what my contact told me, the Judge called payoff money to cut the bankers a sweet deal over the existing shareholders. (My contact didn't sue the company, he's not the type to sue anyone.) The CEO cut himself a sweet deal with some bankers that basically went like this, "you give me a check for $3M (for himself, not for the company) and in exchange I'll give you $X on the share, while we screw the existing shareholders and give them only $X/C per share." (where C>1) This went to court. The Judge was really, really mad at the CEO and bankers, apparently fuming. The Judge said the relationship between the CEO and bankers was not appropriate and the Judge told the bankers, "you're basically paying this guy (the CEO) $3M so he gives you $x/share while you screw the existing shareholders, and there's no law that prevents you from doing this. I'm mad, but I can't do anything about it." The significant thing that happened in this particular story was the special payment the CEO received (funneled through the company from the bankers) in exchange for cutting an extra sweat deal with bankers who received an excessively preferential deal that abnormally screwed existing shareholders. It was inappropriate for the CEO to get money in exchange for giving the bankers preferential treatment, but not illegal. SEC claims they will investigate the relationship between bankers and the CEO. But I'll believe this, when I see them investigate this company. And you would just die if you knew the name of this CEO who is now at a very large and very famous company. Screw one company, move on quickly, then screw an even larger company Unbeliavable. (Fortunately, he's no longer a CEO in high-tech, he burned too many bridges, so he moved onto a different industry. Got even more money too.) The contact that told me this story, said to me, if I ever leave the board of our startup, he said something like, what would be the value in it for him to stay, implied he'd walk if I weren't on the board. That rattled me, because at some point I would assume I'll need to step down from the board as it gets bigger. But the company needs him. It shows you how rattled his experience and the stories in the news, made him. It makes me feel an outside board member is less likely to be as tuned-in, or care, as what an internal person is going to be. Regards, Amy J