The Investor

The Stench of a Snitch

By becoming Poster Boy for the Arthur Andersen Culture Club, David Duncan hocked his moral compass.

By 4.12.02

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Everyone screws up. We all have bad moments in our lives, in which we do things that are illegal, or shameful, or deceitful, or lazy, or things we're just not proud of. If we accept the consequences and try to do better, the world will eventually come to terms with us. Look at Mike Milken. He was involved in some pretty sophisticated wrongdoing that probably took billions of dollars out of savings and loans, which the government had to replace. But he did his time, and is now advising billionaires, financing a cure for prostate cancer, and even friends with the man whose mission was to bring him down, Rudy Giuliani.

Milken may have been a bigger bank robber than a thousand Pretty Boy Floyds, but he at least had the sense to take the rap in the end. You can argue whether he paid enough of a price, but he submitted himself to the system, with nothing but his deeds and his guilty plea on which to judge him. Unfortunately, the world is much too quick, and makes the terms far too easy, for those who sell the secrets of their friends, offering them up to spare their own hides.

I wonder if David Duncan, the fired Arthur Andersen partner in charge of the Enron audit, thinks about these things. In what may be the defining moment of the Enron case, he agreed to plead guilty and give the government information against his old firm, employees, colleagues, and friends. Some will say he is accepting responsibility, at least. Some will say self-preservation entitled him to do this. Some will say Andersen tried to make him the fall guy, so he had to get them first.

Some will say those things, but no one I respect. I think ratting out your friends and colleagues by telling their secrets is one of the lowest things you can do. (Ratting out your daughter by telling her secrets is worse, Marcia Lewis.) Arthur Andersen's best hope now is to seek dispensation under the Americans with Disabilities Act. No one at the firm seems to have a spine.

Two Brothers, a Dodge Charger, and a Clogged Toilet
I'm nine years old, in the back seat of the car with Bart, my younger brother. The family is driving from Detroit to Chicago to visit relatives. I'm making faces at Bart and stop every time Mom is about to turn around.

Finally, Bart says, "Dad, Mike's throwing napkins out the window."

As Dad's disapproval burns through me via the rearview mirror, I play my trump card. "Bart stopped up the toilet this morning before we left and didn't tell you."

Bart was terrified when he told me about it that morning. I tried to wrestle with the plunger on his behalf, but succeeded only in turning the bathroom floor into a swamp. When I think back on that time, I wish I hadn't tattled. I also wish I was miles away when Mom saw the bathroom floor three days later. Eventually, however, I learned that it's better to take the blame than to divert attention to someone else's mischief, especially if I learned of that mischief in confidence.

In a Perfect World, Gordon Liddy and Susan McDougal Would Be Married
Arthur Andersen's former CEO, Joe Berardino, is no prince either, nor are the other Andersen partners who crowed to Congress that Duncan did all this himself. (Even Congress smelled a stinker there.) But this doesn't excuse Duncan's behavior. If Duncan did wrong, he can fight or give up. But the consequence of his giving up should be his acceptance of responsibility or at least resignation to his fate. Blaming some more people just puts him alongside them in the gutter.

Every stool pigeon has an excuse. John Dean was going to be made the fall guy of the Nixon White House. Henry Hill was worried about Jimmy Burke. Sam Gravano was worried about John Gotti.

How will you ever be worthy of someone's trust -- that of a client, or a friend, or a colleague, or a boss, or an employee, or a spouse -- if your loyalty is negotiable?

When did we become a nation of free agents? Intimacy and friendship come from loyalty. Responsibility comes from loyalty. When you're cornered, you take the punishment. You don't make your responsibility disappear by fingering someone else. Regardless of politics or their belief in their innocence, I respect Gordon Liddy and Susan McDougal. Both turned down leniency when it was offered in exchange for implicating their friends.

I don't enjoy living in a world where every person is potentially an agent against you because they found a better deal. You can be the most understanding employer in the world, fair and caring to your employees in every way. If someone offers them 10% more money, they're off to work as the cleaning crew of a Tijuana whore house. Your business partner could empty the files and the bank account while you're on vacation. Someone offered him a better deal, and who is he to make his children attend a state college when he loves them enough to give them more?

If people like Joe Berardino and David Duncan exemplify Andersen's corporate culture, the firm probably belongs at the bottom of a dumpster. If I can get over what a shabby operation the whole place must be, I'll root for Andersen to fight the government. I like our government a lot more than I like Arthur Andersen, but I don't believe we should buy the testimony of admitted wrongdoers. I say that Andersen should go down swinging, and I even give them a decent chance of winning at trial. Then they can get their wish of making Duncan take the rap alone.

I hope the judge sentences him to a long term, at a place like our bathroom after we got back from Chicago.

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About the Author

Michael Craig is a writer in Scottsdale, Arizona.