Fleecing the Shareholder: How They Did It

This story is part of a special series by TheStreet.com investigating shareholders' reaction to corporate corruption on Wall Street. Click here to see a full listing of stories.

Remember the good old days? Those simpler times, back when the biggest complaint you could scare up about a CEO was that he missed the occasional earnings estimate and the stock tanked as a result?

The days of the simple mistake are over -- gone the way of MCI's quarterly dividend.

Yes, back in the days when people said the words New Economy without irony, corporate executives were pretty straightforward in how they disappointed their investors.

Now, unfortunately, we live in a more complex world -- one in which industrious executives have devised a multitude of ways to provoke, mislead and betray shareholders, not to mention enrich themselves at expense of workers and equity investors. It's so confusing that we thought it high time to survey the landscape of transgressions now in fashion. Read on.

But first, let's try to quantify the damage. Start with a handful of companies facing various allegations of financial chicanery or questionable accounting practices: Global Crossing, Enron, WorldCom, QwestQ and Tyco TYC. Just by themselves, according to TheStreet.com's back-of-the-envelope calculation, those five companies are responsible for vaporizing $320 billion in market capitalization since the end of 1999.

Think about it: Those companies alone amount to 8% of the $4 trillion in market capitalization that the S&P 500 has lost since the end of 1999. What appear to be corporate misdeeds, unfortunately, are not victimless crimes.

So now, investors are faced with the unpleasant task of sorting through lesser evils and greater ones. As they sift through each day's financial news, they ask themselves: What's the newest executive plot to be alleged by law enforcement authorities? And how does this rank in comparison with all the other allegations afoot?

In other words, executives haven't merely gone bad. They've gone bad in ways that render past understanding of badness obsolete. They go bad in ways that force us to make subtle distinctions between degrees of badness.