Caterpillar Fails to Dig Deep Enough...

[GRG55]

Who among us doesn't admire the Chinese for taking the fraud lessons from FIRE and applying them on a scale so grand even the most deep pocketed global companies keep getting sucked in? I suppose it's poetic justice that CAT, one of the "banks in drag" (like GM and GE), was the target this time...

AP/ January 28, 2013, 8:24 AM

Caterpillar saw earnings drop at end of 2012

MINNEAPOLIS Caterpillar's (CAT) fourth-quarter profit was cut in half by a deal in China that went bad and by slower growth around most of the world...

Caterpillar: $580 million charge tied to accounting tricks at company in China

NEW YORK Caterpillar (CAT) said Friday that it found deliberate "accounting misconduct" at a recently acquired company in China.

The U.S. based construction and mining equipment company has removed several managers at the company and will take a non-cash $580 million charge in the fourth quarter tied to the misconduct.

Caterpillar said that an internal investigation of coal mining company ERA Mining Machinery and its subsidiary Zhengzhou Siwei Mechanical & Electrical Manufacturing uncovered the issue.

Caterpillar determined that several Siwei senior managers were involved in the accounting misconduct before the acquisition. It said they were trying to overstate the profitability of Siwei prior to the deal...

[don]

Re: Caterpillar Fails to Dig Deep Enough...

Is misconduct Mandarin for no admission of guilt?

Damn fast learners . . . mumbled Kipling.

Not so sure the Chinese are beating the US on magnitude of fraud.

Not yet, anyway.

[lakedaemonian]

Re: Caterpillar Fails to Dig Deep Enough...

I wonder how the culprits will be treated?

I suspect if they got pinched stealing money from the government and they didn't have top cover they'd maybe be eating a bullet.

I wonder how it compares if you fleece a foreign company instead of local/regional/national Party?

[touchring]

Re: Caterpillar Fails to Dig Deep Enough...

I wonder how the culprits will be treated?

I suspect if they got pinched stealing money from the government and they didn't have top cover they'd maybe be eating a bullet.

I wonder how it compares if you fleece a foreign company instead of local/regional/national Party?

Govt officials are heavily involved in businesses through their family members.

[lakedaemonian]

Re: Caterpillar Fails to Dig Deep Enough...

Govt officials are heavily involved in businesses through their family members.

Absolutely.......but it would be interesting to see a comparison between those in China executed for financial crimes and those that should be(according to their legal system) but aren't.

[touchring]

Re: Caterpillar Fails to Dig Deep Enough...

Absolutely.......but it would be interesting to see a comparison between those in China executed for financial crimes and those that should be(according to their legal system) but aren't.

Cheating is very common in China, even for a tourist in China, you'll probably be cheated at least once if you been to China on your own for more than 1-2 weeks. Since there are millions of cheating cases (in a day) the police usually don't bother unless it involves kidnapping and murder.

The ones that were executed for financial crimes are usually involved in extensive pyramid schemes that affect tens of thousands of peasants and some even millions.

Since local government officials are involved wherever there is money to be made - whether legal or illegal, these criminals are well protected, and if there were to be sentenced to death, the matter must have been brought to the attention of Beijing.

But before Beijing notices the matter, probably thousands had protested in front of government offices for their money back, clashing with the state security with clubs and machettes, a few police cars overturned and set on fire and a couple of victims shot dead in the process.