Salad oil scandal,
Definition of Salad oil scandal:
The Salad Oil Scandal’s mastermind was Anthony De Angelis, a commodities trader, and Allied founder. He eventually served seven years in prison for fraud and conspiracy.
The Salad Oil Scandal of the early 1960s was one of the worst corporate scandals of its time. It occurred when executives at New Jersey-based Allied Crude Vegetable Oil Company discovered that banks would make loans secured by the company’s soybean oil, or salad-oil inventory. When inspectors would test Allied’s holding tanks to confirm they were full, the company consistently passed the test. However, management didn't remind anyone that oil floats on water. The containers, filled with water, had just a few feet of oil on top, fooling everyone. In 1963, the scam came to light, and over $175 million-worth of salad oil was missing, causing several notable market reverberations..
A corporate scandal that occurred in 1963, when Allied Crude Vegetable Oil took out sizable loans secured by inventories of salad oil. The company used tricks to fool cargo inspectors in order to conceal the fact that much of the inventory was actually water, enabling $175 million worth of loan fraud to take place.
Meaning of Salad oil scandal & Salad oil scandal Definition