Enron
Case 1.4 AMRE, Inc.
1. Generally, ethics refer to moral principles and values. Random House Webster’s College Dictionary notes that ethics are “the rules of conduct recognized in respect to a particular class of human actions or governing a particular group, culture, etc.” An individual 's ethics generally define what that individual believes to be right and wrong. Professional ethics are typically expressed by a code of conduct adopted by an organization that represents a profession. Professions adopt such codes to encourage moral conduct among their members.
Following is a list of the individuals involved in the AMRE case:
Robert Levin, Chief Operating Officer
Dennie Brown, Chief Accounting Officer
Walter Richardson, Vice President of Data Processing
Steven Bedowitz, Chief Executive Officer
Mac Martirossian, Chief Financial Officer
Edward Smith, audit engagement partner
Joel Reed, senior audit manager
My experience has been that students differ markedly in their assessments of the ethics of these individuals. In particular, students generally have difficulty arriving at a consensus assessment of Martirossian’s conduct in this case. I believe that the lively debate typically produced by this exercise is healthy for students since such debates allow them to begin developing or "fleshing out" their attitudes regarding important ethical issues and concepts.
2. The executives involved in the AMRE fraud agreed in a consent order to refrain from violating federal securities laws in the future. In addition, Robert Levin and Dennie Brown forfeited funds they realized from sales of AMRE stock during the fraud. Levin also paid $1.8 million to the federal government, including a $500,000 fine for insider trading. Finally, Levin and Steven Bedowitz contributed approximately $9 million to a settlement pool to resolve a large class-action lawsuit. Most students conclude that the AMRE executives who participated in the fraud were appropriately
1. Generally, ethics refer to moral principles and values. Random House Webster’s College Dictionary notes that ethics are “the rules of conduct recognized in respect to a particular class of human actions or governing a particular group, culture, etc.” An individual 's ethics generally define what that individual believes to be right and wrong. Professional ethics are typically expressed by a code of conduct adopted by an organization that represents a profession. Professions adopt such codes to encourage moral conduct among their members.
Following is a list of the individuals involved in the AMRE case:
Robert Levin, Chief Operating Officer
Dennie Brown, Chief Accounting Officer
Walter Richardson, Vice President of Data Processing
Steven Bedowitz, Chief Executive Officer
Mac Martirossian, Chief Financial Officer
Edward Smith, audit engagement partner
Joel Reed, senior audit manager
My experience has been that students differ markedly in their assessments of the ethics of these individuals. In particular, students generally have difficulty arriving at a consensus assessment of Martirossian’s conduct in this case. I believe that the lively debate typically produced by this exercise is healthy for students since such debates allow them to begin developing or "fleshing out" their attitudes regarding important ethical issues and concepts.
2. The executives involved in the AMRE fraud agreed in a consent order to refrain from violating federal securities laws in the future. In addition, Robert Levin and Dennie Brown forfeited funds they realized from sales of AMRE stock during the fraud. Levin also paid $1.8 million to the federal government, including a $500,000 fine for insider trading. Finally, Levin and Steven Bedowitz contributed approximately $9 million to a settlement pool to resolve a large class-action lawsuit. Most students conclude that the AMRE executives who participated in the fraud were appropriately