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[News] [Rival] Former Microsoft Employee Blasts Microsoft Over Financial Practices

  • Subject: [News] [Rival] Former Microsoft Employee Blasts Microsoft Over Financial Practices
  • From: Roy Schestowitz <newsgroups@xxxxxxxxxxxxxxx>
  • Date: Tue, 01 Dec 2009 23:59:43 +0000
  • Followup-to: comp.os.linux.advocacy
  • Newsgroups: comp.os.linux.advocacy
  • User-agent: KNode/4.3.1
Hash: SHA1

Washington State to Microsoft: why aren't you paying your taxes?

,----[ Quote ]
| Last week, Microsoft told Seattle's KUOW: 'We 
| pay all our tax obligations everywhere we are, 
| properly.' Today, Microsoft Tax Dodge, a new 
| website focused on the company's royalty tax 
| dodge, challenged CEO Steve Ballmer today to 
| live up to his spoken commitment to transparent 
| business practices: 'At this point, I think it's 
| reasonable to ask Microsoft to back up that 
| claim with a public explanation of the company's 
| licensing operations. In that spirit, will you 
| tell the public how it is that Microsoft has 
| avoided paying Washington State's B&O Royalty 
| Tax for the past 12 years?' Washington State 
| currently faces a projected $2.6 billion 
| deficit. In addition to the ethical and public 
| relations issues that crumbling bridges and 
| overcrowded schools (Seattle recently 
| considered making D a passing grade) present 
| to the state's most profitable company, the 
| compa ny also faces deeper scrutiny of the 
| legality of its tax practice. 




,----[ Quote ]
| THE ALLEGATIONS WERE shocking: For years, Microsoft has systematically
| distorted its profit figures in an effort to consistently beat Wall Street
| expectations and keep its stock price steadily rising. The false reports
| would violate SEC regulations, and amount to outright fraud.
| More shocking was the source of the allegations: Microsoft's chief of
| internal audits, Charlie Pancerzewski, who reported directly to the company's
| chief financial officer.
| Most shocking of all was what happened to Pancerzewski when he reported the
| suspicious bookkeeping to his supervisors, Microsoft CFO Mike Brown and chief
| operating officer Bob Herbold, in the spring of 1995. Soon afterward,
| Pancerzewskiâwho for nearly five years had received stellar performance
| evaluationsâreceived his first-ever unsatisfactory one, and was eventually
| forced to resign.
| Two months ago, Microsoft quietly settled a lawsuit containing these
| allegations, filed in 1997 by Pancerzewski under the Whistleblowers
| Protection Act. The auditor claimed he was wrongfully terminated after
| telling his supervisors that Microsoft might be breaking securities and tax
| laws. The lawsuit made its tortuous way through several rounds of pretrial
| motions until last fall, when US District Judge Carolyn Dimmick denied
| Microsoft's final plea for summary judgment, finding credible evidence that
| Microsoft may have violated SEC rules, as Pancerzewski alleged. Shortly
| thereafter, Microsoft and Pancerzewski settled out of court. Terms of the
| agreement were sealed, but one source who claims familiarity with the case
| says that Microsoft paid Pancerzewski $4 million.

Version: GnuPG v1.4.9 (GNU/Linux)


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