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CEO used company millions to fund lavish lifestyle

There were a number of huge fraud cases in the 2000s

Running a massive company is not easy.

It requires a lot of time and effort and giving up a lot of your free time if you reach the level of CEO.

You need to be tough, you need to make hard decisions, and you need to accept that you're likely to take the wrap if things go wrong.


Likewise, if the company finds itself in the mire of corruption and illegality, then the CEO is likely to get the blame.

As has been seen in scandals like WorldCom, the bosses can find themselves in prison for this kind of behavior.

Being the boss has a huge amount of responsibility, which is why they tend to get paid so much.

Sometimes the power and prestige of these roles can lead to criminality, and, ultimately, jail.

Who was Dennis Kozlowski?

Kozlowski was a long-serving member of staff at Tyco International, a security systems company based in New Jersey.

He joined in 1975 before becoming CEO in 1992.

His time in charge saw the company grow massively throughout the late 1990s.

He left under a cloud, though, with some controversy over how much he was being paid and his extravagant personal spending.

In 2005, charges were brought against him over a staggering $81 million in allegedly unauthorized bonuses.

It was also alleged Tyco paid for a $30 million New York Apartment, as well as personal gifts and parties.

This even included $1 million towards a $2 million birthday party for Kozlowski's wife.

He also paid a $20 million "finding fee" to a member of Tyco's board without approval.

$14 million's worth of paintings invoiced to Tyco's offices ended up in his apartment.

Eventually, he was charged with stealing more than $600 million of assets from Tyco and its shareholders.

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The trial

Kozlowski's first trial fell through, after a problem with one of the jurors.

He testified on his own behalf in the second trial in 2003.

He told the court his pay package was "confusing" and admitted it was "almost embarrassingly big."

He has always denied committing a crime, arguing all of the money that went from Tyco to their client was authorized and that he never looted the company.

However, the jury didn't agree, and in September 2005, he was sentenced to jail in the Manhattan Supreme Court.


He was sentenced to serve from eight years and four months to 25 years for his crimes.

He, along with former Tyco chief financial officer Mark Swartz, were ordered to pay back $134 million.

He was also fined $70 million, with Swartz fined $35 million.

Swartz was also given the same jail sentence.

They were both convicted of 22 counts of grand larceny, falsifying business records, securities fraud, and conspiracy.[12]

Speaking before his sentencing, he said: “I was a guy sitting in a courtroom making $100 million a year and I think a juror sitting there just would have to say, 'All that money? He must have done something wrong,'” he said. “I think it's as simple as that.”

They were both released having served nine years of the sentence in 2014.

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