The Company AIG was a company that had risen to the top through unethical procedures and acts. The company became a big financial giant in the insurance industry and later added the subprime mortgages to its portfolio that increased its profits into the billions. The company cut corners by aggressively lobbying for laws and rulings that would go in their favor (Thorne, Ferrell, & Ferrell, 2011). They came under investigation by the SEC because they thought they were reporting profits wrong. Also, the company was giving unearned bonuses to upper management and promising investors, and stakeholder’s money that they weren’t paying. The company misused company funds for self-gain. Although, it claims in its mission statement these words, “We aim
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The company came into extremely bad times and were about to file bankruptcy, but the government bailed them out. The company should have used the money to clean up the mess they made, but instead gave themselves bonuses and threw elaborate parties. The government did not put any regulation on how they were to use this money, which led to the misuse of it. The government had to bail them out because to many other institutions would have went down with them. AIG abused the trust of its investors, stakeholders, and employees making it the biggest scandal ever because it had to be saved by the government or it would have caused an economic depression. The website says, “At the heart of everything we do is an unshakable commitment to honesty, fairness, and respect (AIG, 2014).” The action of the company has spoken louder than these empty …show more content…
They did not consider the damage that would be done to the company or its investors. The high executives only considered increasing their wealth and lifestyle. The benefits of regulation are in place to help companies stay honest. It is in place to enforce moral and ethics of the companies. AIG was buying and bribing official by staying involve with the laws and ruling in the government (Thorne, Ferrell, & Ferrell, 2011). The government did not enforce or monitor this company correctly because its behavior was going on for years before the bubble burst on them. In my opinion the cost outweigh the benefits because AIG enjoyed the benefits of living a lavish lifestyle with perks and toys, but it cost the economy a big loss and other businesses that were not able to get a bailout because of their reckless behavior. There were many people affected by the irresponsible actions of this company. The kicker to me was that they repeated the same action once given more money to correct the damage already in place. This really amazed and angered me at the same time. The advantages of deregulation is that a monopoly can stand, competition is good, and prices are lowered to be affordable to the average consumer. The disadvantages is that deregulation brings competition for the corporations that had control of the market and the lower prices make it hard for them to maintain the control of the position they once had. Also, it is not good that
The company came into extremely bad times and were about to file bankruptcy, but the government bailed them out. The company should have used the money to clean up the mess they made, but instead gave themselves bonuses and threw elaborate parties. The government did not put any regulation on how they were to use this money, which led to the misuse of it. The government had to bail them out because to many other institutions would have went down with them. AIG abused the trust of its investors, stakeholders, and employees making it the biggest scandal ever because it had to be saved by the government or it would have caused an economic depression. The website says, “At the heart of everything we do is an unshakable commitment to honesty, fairness, and respect (AIG, 2014).” The action of the company has spoken louder than these empty …show more content…
They did not consider the damage that would be done to the company or its investors. The high executives only considered increasing their wealth and lifestyle. The benefits of regulation are in place to help companies stay honest. It is in place to enforce moral and ethics of the companies. AIG was buying and bribing official by staying involve with the laws and ruling in the government (Thorne, Ferrell, & Ferrell, 2011). The government did not enforce or monitor this company correctly because its behavior was going on for years before the bubble burst on them. In my opinion the cost outweigh the benefits because AIG enjoyed the benefits of living a lavish lifestyle with perks and toys, but it cost the economy a big loss and other businesses that were not able to get a bailout because of their reckless behavior. There were many people affected by the irresponsible actions of this company. The kicker to me was that they repeated the same action once given more money to correct the damage already in place. This really amazed and angered me at the same time. The advantages of deregulation is that a monopoly can stand, competition is good, and prices are lowered to be affordable to the average consumer. The disadvantages is that deregulation brings competition for the corporations that had control of the market and the lower prices make it hard for them to maintain the control of the position they once had. Also, it is not good that