Scandals and controversy are not uncommon in the world of big business.
Some lead to collapse and some lead to prison sentences for company executives.
In some cases, those executives have also worked hard to try to keep their behavior a secret, which often has led to worse consequences for them.
Below are 11 of the biggest business cover-ups that have shocked the world.
Volkswagen’s Emissions Scandal
In 2015, Volkswagen was caught using software to cheat emissions tests.
The company had been installing “defeat devices” in diesel vehicles, making them appear more eco-friendly during tests while emitting up to 40 times more nitrogen oxide in real-world driving conditions.
The cover-up affected around 11 million cars worldwide.
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Siemens’ Bribery Scandal
In the mid-2000s, Siemens, one of the world’s largest engineering companies, was involved in a massive bribery scandal. The company paid over $1.4 billion in bribes to secure contracts across several countries. Siemens hid these payments through slush funds and fake contracts.
Once regulators uncovered the illegal schemes, Siemens paid more than $1.6 billion in fines, making it one of the biggest corporate corruption cases in history. The scandal damaged the company’s reputation and forced significant internal reforms.
BP and the Deepwater Horizon Oil Spill
In 2010, the Deepwater Horizon oil spill became the largest environmental disaster in U.S. history. BP initially downplayed the spill’s severity and failed to provide accurate information about how much oil was leaking. Their response strategy exacerbated the situation, causing greater environmental harm.
Wells Fargo’s Fake Accounts Scandal
Between 2011 and 2016, Wells Fargo employees created millions of unauthorized bank accounts in customers’ names to meet sales targets. While senior management knew of the issues, they did little to stop it. The scandal resulted in a $3 billion settlement after public outcry and regulatory investigations.
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Tyco’s Executive Scandal
In the early 2000s, Tyco’s top executives, including CEO Dennis Kozlowski, were accused of stealing more than $600 million from the company through unauthorized bonuses and stock sales.
The company’s efforts to conceal the scandal came crashing down when Kozlowski’s lavish lifestyle, including a $2 million birthday party, became public.
Theranos and the Blood Testing Deception
Theranos, led by founder Elizabeth Holmes, claimed to have revolutionized blood testing with technology that required only a few drops of blood. However, the company was unable to deliver on these promises. For years, it covered up the technology’s failures with deceptive claims and misleading tests, eventually leading to the company’s collapse and Holmes’ conviction on fraud charges.
Holmes recently announced she was appealing the sentence.
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WorldCom’s Accounting Fraud
In 2002, telecom giant WorldCom was exposed for inflating its profits by $11 billion through fraudulent accounting practices.
Executives had disguised operating expenses as capital investments to hide financial troubles. Once discovered, WorldCom filed for bankruptcy, leading to significant regulatory reforms in corporate governance.
ExxonMobil and Climate Change Denial
Since the 1970s, ExxonMobil’s internal research had shown that burning fossil fuels contributed to climate change.
Despite this knowledge, the company publicly denied the findings and funded climate denial campaigns to mislead the public for decades. This cover-up has been widely criticized for delaying necessary action on climate change.
Olympus’ $1.7 Billion Fraud
In 2011, Olympus, a Japanese optical company, was found to have hidden $1.7 billion in losses dating back to the 1990s. The company had been covering up the losses through mergers and acquisitions.
When the CEO revealed the fraud, the company’s stock plummeted, and several executives faced criminal charges.
Union Carbide and the Bhopal Disaster
In 1984, a gas leak at a Union Carbide plant in Bhopal, India, killed thousands of people and affected hundreds of thousands more. Union Carbide tried to downplay its responsibility for the disaster, blaming local operators.
The company’s failure to acknowledge its role and provide adequate compensation led to decades of legal battles.
Philip Morris and the Tobacco Industry’s Health Cover-Up
For decades, tobacco companies, led by Philip Morris, suppressed research linking smoking to cancer and other health risks. Internal documents revealed that the companies knew about the dangers of smoking long before they admitted it publicly.
This cover-up led to massive lawsuits and regulations that reshaped the industry.
Lessons from Corporate Cover-Ups
These scandals show that attempts to hide corporate wrongdoing often lead to far worse consequences. Transparency and accountability are essential for long-term business success, while cover-ups risk destroying reputations and eroding trust.
For businesses, the lesson is clear: honesty may be painful in the short term, but the cost of deception can be far greater in the long run.
