11 most scandalous business events of 2013
Edward Snowden and the NSA leaks
Without question, the scandal of the year: The U.S. government still doesn't know the number of secrets Edward Snowden, the National Security Agency contractor-gone-rogue, snuck out of the country with last June. The strands to this scandal are many: from the extent of government spying at home and abroad to the ease with which a single contractor got a security clearance, fled the country with untold amounts of sensitive data, and outran that government on a wild goose chase. And the scandal, of course, is still unfolding.
Bangladesh factory collapse
The deadliest accident in the history of the garment industry -- something you would have expected in 1813 rather than 2013 -- killed 1,100 workers in Bangladesh last April, after the factory in which they worked collapsed. The disaster was entirely preventable -- the owner had violated building code and failed to heed repeated warnings that it was unsafe -- and the incident prompted a rethink among Western clothing companies that rely on the cheap labor (and substandard conditions and facilities) in Bangladesh, the second-largest exporter of clothing behind China, to keep their costs low.
The disastrous debut of Healthcare.gov
Where to begin? The glitches, the website crashes, the dismally low enrollment numbers. It's hard to see the Oct. 1 launch of Obamacare and its virtual face, Healthcare.gov, as anything but a disaster. In the much-awaited initiative's first month, the site was offline more than it was online. Notably, the contractors the government hired for the enormous project, including Canadian outfit CGI Federal, have emerged relatively unscathed.
JP Morgan, scandal machine
The nation's biggest bank was in the news a lot this year, and rarely for something not related to one of its many past or present scandals. From the fresh investigation into the bank's questionable recruiting practices in China, targeting the children of the elite and politically powerful, to the billions of dollars it's had to shell out for its part in other scandals related to Bernie Madoff, mortgage-backed securities, manipulation of electricity markets, and the London Whale, it has not been a great year for JPMorgan (JPM).
GlaxoSmithKline bribery scandal
Chinese officials detained employees of the British pharmaceutical company last summer for allegedly using travel agents to bribe doctors, hospitals, and government officials to sell more expensive drugs in the country. GSK is cooperating with the investigation, but sales still fell 60% in the third quarter. Other multinational drug companies in China, believed to fall under similar suspicion, have changed their marketing practices.
Lululemon sheer pants scandal
As if the price of a pair of yoga pants ($98!) from this cultish Canadian company was not scandalous enough, the outfitter had to recall them when customers complained the pants were see-through. Lululemon (LULU) founder Chip Wilson only made matters worse when he blamed the sheerness issue on the size of women's thighs. He resigned from his chairman position in December.
European horse meat scandal
The European Union's heavily regulated food and drug industries couldn't keep horse meat, secretly substituted for beef, out of a number of foodstuffs, from lasagna to beef burgers to Ikea's meatballs. The cases of "food fraud" first detected in Ireland last January were later discovered, to much dismay, in countries across the continent. Organized crime groups are suspected to have been the fraudsters.
New York retailers Barney's and Macy's (M) came under fire -- and a state investigation -- last fall after reports surfaced that black shoppers including Treme actor, Rob Brown, had been detained by security at the stores after buying luxury goods. The allegations of racial profiling sparked outrage and culminated with a shopper's "Bill of Rights," which was signed by major retailers and announced at a press conference with Al Sharpton.
The poop cruise
Four thousand cruise-goers aboard the Carnival Triumph were stranded at sea for four days in February without power or working toilets, due to a fire in one of the ship's generators. After being towed to shore in Mobile, Ala., the ill-fated sail became known famously as "the poop cruise." It's since been revealed that Carnival (CCL) knew the ship had issues. Lawsuits are pending.
Google's love triangle
Very few secrets can escape Google (GOOG) these days, so it must have seemed like sweet justice to some when the personal and messy affairs of Google co-founder Sergey Brin became a topic of brief internet fascination last fall. The particulars of this Silicon Valley scandal: Brin separated from his wife, Anne Wojcicki, sister of Google executive Susan Wojcicki, and took up with a Google Glass marketing manager, who worked under his purview. That employee had also recently been romantically linked to another Google exec, who left Google for a phone company in China, not long before all this news involving Brin broke.
This one already seems like a distant memory. After years of denials and deflective finger-pointing, Lance Armstrong, cancer survivor and cycling champion, came clean in January and told us (via Oprah) what we already knew: He doped. The cyclist lost all of his major sponsors and cut his ties to the Livestrong foundation.