Question
Bernard J. Ebbers, CEO and founder of the telecommunications giant, WorldCom, owed the corporation $375 million for a loan secured by shares he owned in
Bernard J. Ebbers, CEO and founder of the telecommunications giant, WorldCom, owed the corporation $375 million for a loan secured by shares he owned in the company. The value of the company's shares was declining, to the point that the value of its shares was less than the amount of the loan. On February 2, 2002, Mr. Ebbers entered into a series of communications with leading Wall Street stock analysts, whose opinion was helping to drive up the stock price, to counter negative news about the company's economic condition. , which was scaring investors. That day, the company's shares increased by 12% in value. Four months later, the company filed for bankruptcy protection due to its precarious economic condition.
1. Are the aforementioned actions illegal? Are they antithetical? Justify and explain your answer. 2. What is the difference between an illegal action and an unethical one? Justify and explain your answer.
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