Devon alleges: "The RICO defendants used a substantial portion of Devon's investment money to inflate the earnings of other projects with other business partners, or for some purpose other than the projects involving Devon. While leading Devon down this road of deceit and as part of their scheme, the RICO defendants improperly included the funding provided by Devon on the financial reports of STG, thereby exaggerating its performance."
IBM is alleged to have entered into development agreements with investment partners "with no real intention of completing the development of the projects...To keep the scheme alive, the RICO defendants must continue bringing in new development partners so that money invested by the new partners can pay their obligations to prior development partners".
The so-called Ponzi scheme and the individuals named in it were in 2008 and until February 2009 under the direction of former IBM senior VP Robert Moffatt. "Moffatt was recently indicted and plead guilty to securities crimes in connection with his position as an officer at IBM, and as the head of the STG division," the filing alleges.
"Over a five year period through numerous meetings, telephone calls, emails and letters, the RICO defendants promoted this enterprise to benefit themselves and IBM through illegally obtained funding and related investments that were procured by deception, artifice and fraud. By fraudulently enticing Devon to enter into the one sided contracts... the RICO defendants could guarantee that they would meet their division's aggressive profit requirements and then use those very agreements to mask and shield their liability for this racketeering enterprise," the filing continues. Devon wants damages from IBM and the other defendants.
The suit cites four IBM executives by name. Two of them are based in the Triangle, IBM confirmed. The four are:
FSSA anticipated the penalty, disclosing in its lawsuit against fired welfare intake contractor IBM Corp. last month that it expected it to be as high as $2 million. FSSA spokesman Marcus Barlow blamed the mistakes on Armonk, N.Y.-based IBM and said the state would attempt to recover the penalty in its lawsuit.
"This is just one more piece of evidence that they were failing," Barlow said. IBM spokesman Clint Roswell said that's up to a judge and jury to decide. "The FSSA's excuse concerning the reported deficiencies of the food stamp program is - as in other of the state's claims - not based on the facts, as IBM will establish in court," Roswell said.
FSSA and IBM sued each other in state court last month over Daniels' decision last October to fire IBM from its 10-year, $1.37 billion contract to privatize eligibility intake for food stamps, Medicaid and other welfare benefits received currently by about 1.2 million Indiana residents. Democratic House Speaker Patrick Bauer, who also received a letter, has persistently criticized Daniels, his administration and the decision to privatize welfare. "They've shown a callous disregard for people who through no fault of their own cannot provide food for their families," Bauer told the AP.
IBM and its partners introduced call centers, document imaging and other technology to the welfare application process but clients, their advocates and lawmakers complaining of improperly denied benefits, lost documents, dropped calls and other problems.
So basically they will remove all older workers at no cost and, forget forever about any workers they do not need; hire back the any workers they do need at half price with no benefit costs; have the capability to remove any rehired workers without a moments notice, with no severance pay, and with no layoff implications.
It's analogous to you deciding to reduce your family budget - killing your kids is an advantage in every single cost analysis (diapers, food, clothing, insurance, college, ..) but has the drawback that you lose you kids - a part of you. IBM does not consider workers as family - or anything of value. Therefore, killing off the kids in the company is a no-brainer.
I could be wrong - but this sounds like the best plan ever as a way to reduce expenses - as it costs them absolutely nothing.
The only hope is in organizing and not agreeing to a rehire back on at the company's terms instead of your terms. The best path would be to hire in as a contractor or full time employee at a competitor.
They Work For You.com: IBM Pension Scheme. Westminster Hall debates, 13 January 2010, 4:43 pm . Excerpts: Sandra Gidley (Romsey, Liberal Democrat) I am delighted to have the opportunity to raise this matter today. Given the number of hon. Members in the room for a short debate, it is a pity that we could not have had a longer one. I have received representations from the hon. Members for Isle of Wight (Mr. Turner), for Croydon, Central (Mr. Pelling) and my hon. Friend Lorely Burt, who have expressed support for what I am about to say. Many other hon. Members and I have received large numbers of representations as a result of IBM's proposed changes to one of its pension schemes. The proposals have particularly impacted on workers in their 50s, who had carefully planned their retirement. Many of those employees feel aggrieved on two levels. First, they feel let down by IBM, which made certain promises about pensions a few years ago and is using the changes to force workers to retire earlier than planned. Secondly, they feel aggrieved that the Government's pension law does not provide them with sufficient protections.
It might be helpful to the Minister if I provide a little background. In 2003-04, many IBMers with a final salary scheme agreed to increase their pensions contributions by 50 per cent. There was much unhappiness about having to do that because the company had taken a pensions holiday for several years and also took funds from the final salary plan to fund the new defined contributions plan. In 2006, further changes were made to the defined benefit plan and there was a clear attempt to move workers to an enhanced defined contributions plan. Workers who did not transfer were effectively punished because they were told that only 67 per cent. of future salary increases would count towards the pension. That makes something of a mockery of the fact that it was supposed to be a final salary plan.
Although there was some unhappiness, the company ultimately managed to sell the scheme by promising that funding would be available until 2014 and that there would be no further changes until that date. Let us fast forward three years to 2009, when, seemingly out of the blue, IBM announced further changes. Employees were understandably unhappy that IBM proposed to close the final salary scheme, although there has been an acknowledgement from some that that is the way many company pension schemes are going.
There was also concern about the timing of the consultation, which was over the summer holiday period when many people were taking a break, and there was a feeling that the consultation period should have been extended. In the annual report from the pensions trustee, the trustee stated
"The trustee feels that the Company has not lived up to the Trustee's expectations"
in asking to change the plan and the scheme so soon after the changes made in July 2006. That is quite a telling and unusual statement. Unfortunately, to add insult to injury, IBM made some hard-hitting changes to the early retirement terms and conditions and that has had a significant impact on workers who had planned to retire over the next few years. The scheme was that any employee retiring early would have 3 per cent. deducted from the pension for each year they are under the age of 60. That effectively compensates for the fact that a person will be receiving a pension for a longer period of time. For example, someone retiring at 54 with an estimated pension of £20,000 would have it reduced by 18 per cent. to £16,400. ...
Much of the correspondence received has been rather emotive, for example:
"In short, IBM is a very wealthy and very successful company, even in the midst of the credit crunch. It's not a question of IBM not being able to afford to fund its pension scheme, it's a matter of IBM, choosing instead to give the 'saved' money to its shareholders."... Stephen Pound (Ealing North, Labour) On the subject of chief executives, Sam Palmisano, the chief executive of IBM in America has just seen his pension increase by $20 million to $40 million. Does the hon. Lady not find that difficult to justify? ...
Jim Cunningham (Coventry South, Labour) There is something more fundamental to the matter-I declare an interest, as I know someone who works for IBM-because many such pension schemes, when we look at their origins, are subject to wage negotiations, and it is the over-50s in particular who will be hard hurt by that. For example, sometimes pensions were negotiated to offset a wage increase and additional holidays. The concern is far more fundamental, and if there was ever a group of people entitled to get their full pension without changes, it is that group of workers. ...
Sandra Gidley (Romsey, Liberal Democrat) Yes, I do. In some respects, the fact that IBM has so many employees who have stayed with it loyally is testimony to the sort of employer it had been. Those employees have now reached their 50s and do not feel that they have been treated well after the time, investment and professionalism they have devoted to the company. ...
The scheme is really rather clever, and there are concerns that other companies might look at how IBM has managed to handle a large number of job losses and that the manipulation of the early retirement discount factors might become a commonplace mechanism for avoiding redundancy payouts. If the Government are serious about workers' rights, I urge the Minister to investigate that aspect of the problem and take steps to ensure that manipulation of pension scheme terms is not used by companies as a way of avoiding redundancy payouts. ...
Christopher Huhne (Eastleigh, Liberal Democrat) What is clear from what is happening is how the company is using the pension scheme to encourage people to leave early. In effect, it is loading the costs of what would normally be picked up in a voluntary redundancy scheme on to the pension fund. Does the Minister agree that that shows that the legislative framework is not adequate to protect people in pension schemes from such behaviour, and what does she intend to do about it? ...
David Cairns (Inverclyde, Labour) My hon. Friend says that she is not in a position to speculate on IBM's reasons and she is right about that. However, when some of us met IBM we were told that this change was made because of the comparatively poor performance of IBM UK and Ireland. Yet in his final missive to workers issued yesterday, Brendan Riley said that it had been a privilege to lead one of the best performing parts of IBM UK. So there is a clear inconsistency in the message that IBM is sending out: either it is a poor performer or it is a good performer. I am afraid to say that the reality is that hon. Members are right. Whether the Government can do anything about this, I do not know. This is redundancy on the cheap: that is what IBM is up to.
I find this amusing.. I was RA'ed.. then brought back as a contractor...now the division I worked for (ISSW) doesn't have enough people to fulfill most their contracts. I found out that GBS is even worse than ISSW...talk about cutting your nose off to spite your face and short sightedness.
Former Web analyst Nicholas Carroll, who was laid off from his consulting job for IBM in 2008, is such a believer in dumbing down resumes that he dedicated a section of his 2009 e-book, “The Layoff Survival Plan,’’ to it. In the section titled “How to Downgrade Your Resume for a Tight Job Market,’’ Carroll recommends taking titles down one peg, from director to manager, from manager to specialist. Carroll removed his bachelor’s degree in technology management after he lost a job as a website developer during the dot.com collapse of the late ’90s in order not to appear overqualified for blue-collar work, and he didn’t stop there. During an interview for a management position at Econo Lube ‘N Tune, “I deliberately hesitated a quarter second before every answer,’’ he said, and at one point decided to fake a “faint look of panic.’’ The morning after the interview, he said, he was offered the job. “Somebody finds out you know that much more than they do, they get nervous,’’ Carroll said. ...
People are so focused on getting back into the workforce that they are setting aside not just complete work histories, but their egos, to go after the kind of position they may have had years before. Unemployed Denver science educator Nancy Hansen removed her master’s degree in ecology and her two Fulbright scholarships from her resume to send a message to a potential employer: “I don’t want you to think that because I have a great resume I’m above doing the work that is here.’’ Hansen is still not getting many callbacks from the museums and schools she has been applying to, but at least she’s not hearing the dreaded “overqualified’’ word anymore. If she is asked about her education or work experience in an interview, she said, she will tell the truth.
In November, Jackson filed for unemployment and received two checks. As part of the rules for receiving benefits, every two weeks, Jackson had to call into what is called a CUBLine (The Colorado Unemployment Benefits Line.) The automated line goes through a series of questions unemployment benefit recipients answer. During one of the calls, Jackson was asked if he'd taken out a distribution from his 401k. He said he did, $10,000 to pay for his son's college.
"We had a commitment with the college my son goes to be able to pay the family portion and when I got laid off that had been a major concern for us," he said.
Jackson said after being laid off and before applying for unemployment, he took more than $230,000 of his 401k he's earned over the years at IBM and reinvested it. Most of the money was put into an indexed annuity, which he can't touch for ten years. About $51,000 went into a liquid IRA. Jackson said he put it there so he could pay for his son's school. After signing up for unemployment benefits, Jackson took out $10,000 to pay for college tuition. He said other than paying taxes, he was not penalized for taking the money out of his fund because it was for higher education.
But when he admitted to the Colorado Department of Labor and Employment he'd taken the money out, his unemployment benefits were cut off. Jackson later learned it's against the law in Colorado to take any money out of your 401k for one whole year if you're receiving unemployment benefits. The language is on the front page of an application Jackson signed in order to start receiving his benefits.
Overall, the big blue ship is sinking. Here is Nostradamus' pickle of the day: "in a very short time frame, the most innovative minds will tend to swim away from it as fast as possible, to avoid being sucked in the oblivion of meaninglessness".
Advice to Senior Management: Why bother? It won't be heard. The above list details pretty much what management should know and try to improve.
Advice to senior management:
On my last contract with the company IBM converted 9 contractors to permanent ibmers, only 2 remain due to ties at the executive level, the rest were fired with the "3" rating. Other ibmers who still remain have expressed dissatisfaction with their salary, many stating no raise for last 6 years. Others who have been given titles of team leads are not receiving the promised bonus, literally having the carrot dangling in their face for months on end. Working at home is also coming to an end, they are hoping this action will force some ibmers to quit/find other jobs. From talking to them they stayed with the company only because of the work from home option so they can manage their family & work better.
I have little sympathy for then, as an underpayed contractor who commutes to work every day, but i digress. I don't see a future for myself in this company & would not recommend anyone buy their stocks, just use them until you can find a better job. If you listen to the shareholder meeting broadcast on w3, it is clear IBM are launching their resources into growth markets at alarming rates. Its just a matter of time before INDIA's economy becomes too expensive and the cycle continues elsewhere. When will this stupidity end? -lonely_cntr-
"But dependency on government has never been bad for the rich. The pretense of the laissez-faire people is that only the poor are dependent on government, while the rich take care of themselves. This argument manages to ignore all of modern history, which shows a consistent record of laissez-faire for the poor, but enormous government intervention for the rich." From Economic Justice: The American Class System, from the book Declarations of Independence by Howard Zinn.
What a hoot! The guy who earlier this year was screeching in horror against government health care coverage for ordinary Americans, has now flipped over to the compassionate side, demanding that those same ordinary Americans simply must "contribute" their tax dollars to clean up the disaster caused by the greed of a foreign oil corporation. Hypocrisy, thy name is Donohue! Even "Saturday Night Live" wouldn't air a skit this crude.
BP might be a British outfit, but it's also a member and major funder of the U.S. Chamber, which in turn has been a major backer of deregulating Big Oil's offshore drilling schemes. Thus, it's really no surprise that Donohue's inner flower child would bloom in the midst of BP's oozing oil disaster. And don't you love his "kumbaya" sensitivity, his we're-all-in-this-together social sensibility?
Let's all sing along with Tom's heart-tugging song: "We are going to have to get the money from the government/ We will figure out a way to do that/ Kumbaya, Lord, kumbaya." Adding to the hilarity, Donohue later tried to retract his socialist stand, but he only came off as a rhetorical contortionist, still leaving taxpayers on the hook for BP's mess.
The right-wing Arizona senator practically weeps for the wealthiest two-tenths of one percent of American families that have estates worth from $1 million to $5 million. What causes Kyl's eyes to brim with tears is that these privileged ones will have to pay an estate tax on wealth above a million bucks, unless Congress exempts them from the oppressive burden of helping to shoulder the cost of America's highways, parks, schools, military, water purity, and other public services we all count on. I'm sure that the other 99.8 percent of us share their pain and appreciate the Republican senate leader's deep empathy for multimillionaires.
How deeply is he touched? Earlier this year, Kyl tried to scuttle an extension of benefits for America's rising tide of unemployed workers, demanding that his favored constituency of superrich families first be given hundreds of billions of dollars in estate tax cuts. He failed in this mission of mercy for millionaires, but he recently came right back with an amendment to derail a proposal to help America's hard-hit small businesses get desperately-needed loans. Forget Main Street, wailed the senator from Easy Street, unless and until we exempt estates worth up to $5 million from the tragedy of taxation.
How much would Kyl's tax cut for the elites take from America's public treasury? More than $80 billion a year, which is what the 2009 estate tax on these rich ones brought in. But, hey, says the jovial plutocrat, we can make that up by slashing programs that benefit the middle class and the poor.
See, it’s just a matter of getting your priorities straight. Guys like Kyl profess their love for small business, but they always stay true to the rich.
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