Plastech Tried to Hide Greed, Nepotism, Expense Account Fraud

plastech tried to hide greed nepotism expense account fraud

You may recall the Plastech debacle. Chrysler's interior supplier got bailouts from ChryCo, then filed for Chapter 11. ChryCo tried to swoop down and take the tooling. A federal judge said no. Since then, the supplier's been sold off. And much to somebody's chagrin, the owner of the mismanaged parts maker has pocketed, wait for it, $12m for running the company into the ground. And if that's not bad enough, and I say it is, Crain's Business Detroit reveals that the federal judge overseeing the break-up allowed Plastech to hide Julie Brown's compensation from public view. And no wonder. "Those documents show that Julie Brown's husband, three brothers, two sisters-in-law, a sister, a cousin and a nephew were on the payroll to the tune of about $6 million a year. Of that, $2.25 million was paid to Jim Brown, Julie Brown's husband. From other documents, it appears that Brown's personal driver, cook and two housekeepers were paid by the company." Strangely, Crain's sense of righteous indignation also files for bankruptcy. "Employing family members is no crime. Trying to keep how many relatives and what they were paid from the public suggests that Plastech's owner thought she had something to hide. If each family member performed his or her duties well, what's the problem? Surely the compensation is not the cause of the company's overall financial problems." No, of course not. Nor is it any indication that the company was poorly run. At all.

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  • Menno Menno on Jun 30, 2008

    I'm not wishing for my own country to fail, quasimondo! Besides, even after the British Empire failed, and even after the Soviet (dis)Union collapsed, life went on. But the American Century was the 20th. We're very, very clearly on the decline. I'm sure the Etruscans didn't want their empire to fail, nor the Greeks, nor the Romans, nor the Dutch, nor Spaniards, nor British. Didn't stop it from happening, though, did it? You know the old saying about wishing in one hand and peeing in the other and see which one fills up first....

  • Quasimondo Quasimondo on Jun 30, 2008

    Actually, I don't. And I don't see any common threads between the collapse of the British Empire, or the Soviet Union, and the possibility of the collapse of the U.S. The Soviets at the time of their collapse was beset by separatists in the smaller republics. I'll show some concern when California decides to split from the union (or maybe not). The British empire, like the Romans, and the Ottomans, and all of those ever expanding empires, simply stretched itself too thin, a problem made worse from trying to fight off Nazi Germany. We're not stretched thin, despite how you feel about our involvement in Iraq, and we're not trying to take over the world. Clearly there is a global shift in power, but I doubt means the U.S. will crumble like Rome in its final days, and it won't be relegated to the back burner of world affairs as quickly as you envision it to be.

  • Qwerty Qwerty on Jun 30, 2008
    The Panic of 1893 bought an end to the Gilded Age of the late 19th century, the country did not break. The 1929 crash brought an end to the Roaring 20’s and triggered the Great Depression, the country did not break. In each of those cases there were fundamental changes in the regulatory powers of the U.S. government that were designed to prevent a reoccurance. They also caused vast amounts of suffering for the average citizen. You have basically proved the point that conditions were left to fester and change did not occur until the system broke down. That is exactly what people are pointing to, that our current situation is unsustainable and the bill will eventually need to be paid. No one knows what will be on the other side of major economic turmoil. Many flirted with fascism during the Great Depression. Pointing to past events that we survived is not reassuring. When a large discontinuity occurs it is impossible to know what the outcome will be. It is like war. Everyone who starts one goes into it thinking it will be short and easy, but the results are often unpredictable. That is why you never want to get involved in one if it is preventable. It is also why letting the country turn into a kleptocracy is very bad idea. Nothing lasts forever. Even though the Brits are still around, sipping their tea and reminiscing about the past when they ruled the world, they are a pale shadow of what they used to be. As menno mentions empires eventually end. If you are lucky it is a long slow decline rather than a cataclismic disruption.

  • Rix Rix on Jun 30, 2008

    I'm curious to know whether anyone in purchasing at the big 2.8 was cut in as well. At least now we know why the costs are so high.