Unfathomable (really, no pun intended) - - why aren't the external auditors resigning OSG acct in indignation?
Given the "pedigree" of the Board members of OSG, it just seems unfathomable that they have gotten the company in such an incredible mess. One of the board members ran the shipping loan division for Chase and its predecessor banks. The shipping market they operate has been awful for a long time, but some seem conservative managements (e.g. Navios Maritime) seem to be surviving.
There is no excuse for fraud, if that what the "tax issue" is. Normally, companies discuss and get tax advise from their external auditors. I suppose it is possible that the auditors were being told one thing by mgmt while something else was happening.. Was OSG keeping more than one set of books? OSG mgmt has given no hint at size of the issue. Why have the auditors not resigned from the account? For the OSG external auditors, the OSG account can not possibly be of material size - - so why don't the auditors resign the account in indignation? Is the issue a "simple" difference of opinion? I would think that if the external auditors resigned the account, that would be a significant event that SEC rules would require disclosure.
I have read that OSG is current on payments to other ship owners from whom OSG is leasing vessels.
It is incredible how fast and how many litigation attorneys swarmed around OSG to drum up shareholders looking to sue the company.
I make an awful admission, this just joins a long list of companies that I have invested in within 12 months or so of their going bankrupt - - - Worldcom (stock), GM (bonds), AIG (stock), and Citibank (stock). In only one instance did I come out whole (Citibank) but in all the others, the losses were significant to me. And now OSG - - I started buying stock in June 12.
From my experience, and I have plenty, there is very little (e.g. 1 to 2%) that the surviving stockholders is able to salvage via litigation. Bondholder recovery is better, even in the GM case (about 30%).
IF a lesson can be learned, it might be to try not to be "greedy".