Tyco CEO Dennis Kozlowski CBS 60 Minutes Prison Interview — Transcript

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1. 0:01a year ago or so the air was thick with
2. 0:03Tales of corporate Scandal lost Pension
3. 0:05funds big-time theft and even bigger
4. 0:08time prison sentences for the Enron gang
5. 0:11then there was Dennis Kowski CEO of Tao
6. 0:14who was found guilty of in effect using
7. 0:17Tao's immense Financial Resources for
8. 0:19what the prosecution described as his
9. 0:22own personal piggy bag you might
10. 0:24remember the $6,000 shower curtain and
11. 0:27stealing over aund million from the
12. 0:29company
13. 0:30well we wondered how the man who could
14. 0:32whistle up a corporate jet on a whim or
15. 0:34throw a $2 million birthday party was
16. 0:37doing in his reduced circumstances
17. 0:39what's it like to go from King of the
18. 0:41world to prisoner number 05
19. 0:45a482 serving 8 to 25 years behind bars
20. 0:50once again Dennis kazlowski
21. 0:54we caught up with Dennis Koslowski at
22. 0:57Midstate Correctional Facility in
23. 0:58Upstate New York how you doing I'm doing
24. 1:01okay guests include murderers drug
25. 1:03dealers and pedophiles and the odd
26. 1:07multi-millionaire in my wildest
27. 1:09imagination uh when I would project
28. 1:11myself into my late 50s and early 60s
29. 1:13where I would be or what I would be
30. 1:15doing if I make a list of a hundred
31. 1:17different places or 100 different things
32. 1:19here would never make that list he now
33. 1:21earns a dollar a day mopping floors and
34. 1:24slinging hash to his fellow inmates in
35. 1:27January Kowski spent a week in in
36. 1:30hospital with a heart ailment and got to
37. 1:33thinking you've not talked publicly up
38. 1:35till now why did you decide to do it
39. 1:37when I was in the hospital in January I
40. 1:40was outside the emergency room feeling
41. 1:42really uncomfortable frightened and
42. 1:44that's when I really made the firm
43. 1:45decision that I wanted to go through and
44. 1:47and and and talk to you at this time you
45. 1:49became aware of your own mortality very
46. 1:51much so and you didn't want to leave
47. 1:54this world without without at least an
48. 1:55opportunity to talk about my side of the
49. 1:59story to the said that I can talk about
50. 2:00it he agreed to speak with one
51. 2:02stipulation that we would not include
52. 2:05anyone else in this story because of an
53. 2:08appeal he'll not discuss the details of
54. 2:10his case but he will say I believe in
55. 2:13the judicial system I think all that
56. 2:14works but in this case the jury got it
57. 2:16wrong that jury convicted him of 22
58. 2:19counts of grand larsy conspiracy and
59. 2:22securities fraud his trials occurred in
60. 2:25the wake of a white colar crime wave
61. 2:28Enron world K and Martha
62. 2:32Stewart the newsound smelled blood
63. 2:35accused of looting his company of
64. 2:36hundreds of millions of dollars and
65. 2:38living the life of aasia at stockholders
66. 2:41expense he was the living breathing
67. 2:44version of wall Street's Gordon gecko
68. 2:48Greed for lack of a better word is good
69. 2:53up to a point what's puzzling is why
70. 2:56does a man who struggled so hard so
71. 2:58effectively to make it become so
72. 3:01careless or stupid or arrogant born in a
73. 3:06tenent on the wrong side of the tracks
74. 3:08in Newark New Jersey klosi worked his
75. 3:10way through school I played guitar in a
76. 3:13band I worked in a pharmacy I worked in
77. 3:15a car wash I had two or three jobs going
78. 3:18at any given time where you came from uh
79. 3:21there weren't that many options no no
80. 3:23growing up in north New Jersey at the
81. 3:25time you know you never thought of
82. 3:26yourself growing up to become a CEO he
83. 3:28started a tao then at a small New
84. 3:30Hampshire manufacturing company as an
85. 3:33accountant making $28,000 a year and
86. 3:36worked his way up to CEO he became known
87. 3:40as deal a day Dennis constantly
88. 3:43acquiring new companies and building Tao
89. 3:46from a $40 million company into a $40
90. 3:49billion conglomerate would like to
91. 3:51become all things equal $100 billion
92. 3:54company Wall Street could not get enough
93. 3:56of the young aggressive CEO he also
94. 3:59began making staggering amounts of money
95. 4:02among the top earning CEOs in the
96. 4:04country we had a pay for performance
97. 4:06culture at Tao so most of the money I
98. 4:09earned was in the appreciation of Tao
99. 4:11stock one year you made I think $170
100. 4:13million not sure 170 but I made over 100
101. 4:15million yeah well more money than 10
102. 4:19million here 10 million there who cares
103. 4:21but what's it like to earn that kind of
104. 4:23money it's a way of keeping score I
105. 4:25guess keeping score meant keeping up
106. 4:27with the Masters of the Universe $30
107. 4:30million to build a mansion in buar Raton
108. 4:33acquiring homes in Nantucket and
109. 4:36Colorado and just loose change $16
110. 4:39million for endeavor a vintage yard
111. 4:44wealth meant one thing social acceptance
112. 4:46another he and his second wife Karen
113. 4:49Mayo spent Millions on painting he
114. 4:52joined the board of the Whitney mum for
115. 4:55a p in New York he had Tao by a $19
116. 4:58million apartment and decorated it with
117. 5:02$1 million worth of stuff the poor kid
118. 5:06from Newark was stepping out on Fifth
119. 5:09Avenue would Dennis Kowski a few years
120. 5:12ago even contemplated going to Europe to
121. 5:14buy old Master paintings no absolutely
122. 5:17not you know it came with earning the
123. 5:18amount of money I was earning at the
124. 5:19time was it your idea or were you
125. 5:22invited to join the board of the Whit oh
126. 5:24I I it was not my idea at all I was
127. 5:26invited to join the board and I never
128. 5:28made a board meeting you were invited
129. 5:30because they like having really rich
130. 5:32guys on the board uh I assume it wasn't
131. 5:35for my knowledge of
132. 5:37art but it was art that would lead to
133. 5:39his undoing the Manhattan District
134. 5:41Attorney's office was investigating
135. 5:44galleries that were helping customers
136. 5:46avoid sales taxes kazlowski had
137. 5:48purchased $13 million worth of paintings
138. 5:51including a Renoir and money for the Tao
139. 5:54apartment but prosecutors said he had
140. 5:57some of them shipped to Tao's office in
141. 6:00New Hampshire a state without sales tax
142. 6:02they were then trucked back to New York
143. 6:05in 2002 the Manhattan District
144. 6:07Attorney's Office indicted Kowski for
145. 6:10evading over a million dollars in sales
146. 6:13tax and he resigned as CEO but that was
147. 6:17only the beginning The Tao board
148. 6:19investigated its CEO's behavior and made
149. 6:22public a report that was devastating
150. 6:26koslow's excesses were revealed in
151. 6:28excruciating detail decorations for the
152. 6:31New York apartment became classic
153. 6:34tabloid headlines mocking the CEO's
154. 6:37taste and his greed the $15,000 doggy
155. 6:42umbrella stand and the ultimate symbol
156. 6:45of his downfall that $6,000 shower
157. 6:49curtain the coverage was really
158. 6:52punishing that was horrible as overblown
159. 6:55as the coverage may have been you signed
160. 6:57off on those things I signed off on a
161. 6:59decorator here to uh decorate The Tao
162. 7:02apartment and beyond that that was my
163. 7:05involvement I the first time I heard
164. 7:07about that shower curtain the first time
165. 7:09was after I was out of the company and I
166. 7:11read about it in a newspaper and I it
167. 7:13was calling around asking where's the
168. 7:15shower Cur but to this day I wouldn't
169. 7:17know it if it fell on me
170. 7:19[Music]
171. 7:20so and then there was the 40th birthday
172. 7:23party for koslowski's wife Karen in
173. 7:26Sardinia
174. 7:30it was toga
175. 7:33Galore a 4-day festival of Flesh let's
176. 7:39rock Jimmy Buffett was flown in for the
177. 7:43music and guests were treated to a
178. 7:46special cake an anatomically correct
179. 7:49woman with exploding
180. 7:51breast the cost was over $2 million
181. 7:55since Kowski claimed it was in part A
182. 7:58work r
183. 8:00Tao footed half the bill was it
184. 8:03embarrassing for you though when they
185. 8:04played that tape kind of or going on
186. 8:08yeah horrible it was over the top look
187. 8:10at that I was taken back by it but I
188. 8:12smiled and worked my way through it
189. 8:14wanted the night end as fast as I could
190. 8:17Donald Trump called your behavior Tacky
191. 8:20Tacky Tacky from Donald Trump from
192. 8:23Donald Trump oh well he would know
193. 8:26so those excesses may have been tacky
194. 8:29but tacky doesn't send you to jail far
195. 8:32more serious was the allegation that
196. 8:34Koslowski literally stole money from Tao
197. 8:37he and his second in command Mark
198. 8:39Schwarz were charged with stealing $170
199. 8:42million and pocketing an additional 430
200. 8:46million through the sale of Company's
201. 8:48stock while lying about Tao's Financial
202. 8:51condition the prosecution accused Kowski
203. 8:55of granting himself unauthorized bonuses
204. 8:58and running hundreds of Millions ions of
205. 8:59dollars worth of personal expenses
206. 9:02through interest free Tao loan programs
207. 9:05no expense was too great or too small to
208. 9:09run through Tao none of this claims the
209. 9:12prosecution was authorized by The Tao
210. 9:15board and the jury agreed guilty but
211. 9:18he's still fighting I am absolutely not
212. 9:21guilty of the charges that were brought
213. 9:22upon me there was no Criminal Intent
214. 9:24here nothing was hidden there were no
215. 9:26shredded documents nobody was told not
216. 9:29to say anything uh all the information
217. 9:32the prosecutors got was directly off the
218. 9:33books and records of the company in the
219. 9:36trial Kowski took the stand and
220. 9:38testified that everything he did was
221. 9:41authorized he'd already repaid many of
222. 9:43the loans and claimed he was simply an
223. 9:46overworked executive who left the
224. 9:49details for underlings to handle I was
225. 9:52pushing the company and growing the
226. 9:53company and pushing all aspects of it to
227. 9:55continue to grow uh I just don't think
228. 9:58we put enough infrastructure in place to
229. 10:01support some of that growth yeah but
230. 10:03some of the some of the lines got
231. 10:05blurred uh some of the lines between
232. 10:09what was your money what was Tao's money
233. 10:11became very fuzzy I think I did
234. 10:14everything accordingly to U you know the
235. 10:17way the programs were outlined and the
236. 10:19way it was done by my predecessors was
237. 10:21there a situation where the rules got
238. 10:24lost more as I said we an appeal on this
239. 10:27and there's also civil litigation so at
240. 10:29this point in time I think we're
241. 10:31crossing the line here the Tao board had
242. 10:33given Kowski virtual card blanch and the
243. 10:37one person kazlowski said could clear it
244. 10:39all up the head of compensation was dead
245. 10:43whatever kazlowski did it was clear that
246. 10:45the Tao board was not exactly meticulous
247. 10:48in carrying out its oversight even so
248. 10:51Kowski believes he was a dead duck from
249. 10:55the start I was a guy sitting in
250. 10:58courtroom who made 100 million a year
251. 11:00and I think a juror sitting there just
252. 11:02would have to say all that money he must
253. 11:04have done something wrong I I think it's
254. 11:06just you know it's as simple as that
255. 11:08kazlowski says he was done in by bad
256. 11:11timing the Enron and Worldcom
257. 11:14catastrophes he feels that most people
258. 11:16believe that's what happened to Tao that
259. 11:19employees were left high and dry but Tao
260. 11:22remains a thriving $60 billion Company
261. 11:26the company went on after I left there
262. 11:28the company is alive say it's doing well
263. 11:30does it make you angry to be lumped in
264. 11:33with guys like Bernie abs and kenl that
265. 11:36just frustrated me to know end these are
266. 11:38companies that had financial and
267. 11:40accounting schemes that had major scams
268. 11:42that wasn't Tao you know this was a this
269. 11:44is a major paid dispute but the jury
270. 11:46didn't see it that way he was sentenced
271. 11:49to 8 to 25 years in ordered to pay
272. 11:52restitution and fines of almost $200
273. 11:55million it's unclear if he'll have any
274. 11:58money left when he's released in the
275. 12:01meantime he spends much of his time in
276. 12:03prison focused on his appeal he can
277. 12:06receive visitors on the weekends but he
278. 12:09says he has few friends left in the
279. 12:12final analysis most of the people were
280. 12:15close to you because of your power and
281. 12:19your wealth that's correct and and they
282. 12:21wanted to share in that that was
283. 12:22probably 90% of the people in my life
284. 12:24and they didn't give a DB about Dennis
285. 12:26kosowski the man that's a that's a hard
286. 12:28thing to uh to reconcile yourself to but
287. 12:31it did happen and it was not just his
288. 12:33friends who left him darling how about K
289. 12:38oh we're divorcing and uh you know
290. 12:40that's we're moving on uh so but was his
291. 12:44marriage like so many things in his life
292. 12:47all about money Welly we're in the
293. 12:50middle of divorce and agreement I'm not
294. 12:52going to say anything about that you
295. 12:54know at this time he says he tries to
296. 12:56stay positive he's 60 years old now and
297. 13:00the harsh reality of his predicament is
298. 13:04inescapable when you're sleeping in jail
299. 13:06you wake up all the time because there's
300. 13:07a light on all night so you kind of wake
301. 13:10up every hour wishing and praying and
302. 13:11hoping it was just a dream no but it's
303. 13:13not it's reality and it's you know where
304. 13:15you are often times guys get religion
305. 13:18inside does that happen with you there's
306. 13:21a spiritual side that you know I think
307. 13:24about and and reflect on from time to
308. 13:26time but that's personal and private num
309. 13:29within me yeah and you've got the time
310. 13:30to do it now I plenty of time yes that I
311. 13:33have