What is "asset stripping"?

[dolgoruky]

Can anyone out there give me an explanation of what "asset stripping" is and how it works in practice? I'm really struggling to get my head around this concept. I've read a lot about this in relation to Russia, but I can't figure out how people get away with it?

Muchas Thanks!

[whistle]

1. It's when a stripper removes all of her jewelry as well as her clothes...

...oh regarding a country, well that's when republicans allow public lands to be sold to private interests for the exploitation of this country's natural wealth for the enrichment of the few. Must be thousands of examples.

Here's a definition: Asset Stripping is the practice of buying a company in order to sell its assets In business and accounting an asset is anything owned, whether in possession or by right to take possession, by a person or a group acting together, e.g. a company, the value of which can be expressed in monetary terms. Asset is listed on the balance sheet. It has a normal balance of debit.
Assets may be classified in many ways. The principal distinction normally made for business purposes is between:

fixed assets and
current assets.

..... Click the link for more information. individually at a profit.
Asset stripping is also sometimes used to describe the practice of investors dealing directly with armed militant groups in developing nations A developing nation is an undeveloped nation. Such countries may actually be developing, but the term is often used euphemistically to include those which are not.
Developing nations are in general countries that have not achieved a significant degree of industrialization relative to their populations, and which have a low standard of living. There is a strong correlation between this status and high population growth...
to take direct control of assets that legally belong to the state

<link> http://encyclopedia.thefreedictionary.com/Asset+stripping

[hobbit709]

2. Asset stripping

Exactly what it says. Taking over a company and looting it of everything of value. Selling property, machinery and equipment, emptying bank accounts etc.

[sangh0]

3. You buy a company

and sell it's assets for cheap, then run away with the money while company collapses.

In the US, there are laws which put a burden of corporate execs to act as a "fiduciary" for the shareholders. What this means is that the execs are required to act in the best interests of those shareholders EVEN IF it's not in their own interests to do so.

In countries that don't have such laws, it's easy to engage in asset stripping. In nations that do have such laws, they are avoided by creating "Plausible Deniability" by portraying the execs as acting on what they thought would be the best interests of the shareholders, even though it didn't turn out that way. That is, they claim that they acted with good intent, which means the prosecutor has to prove that they acted with bad intent.

[TaleWgnDg]

4. try this for starters . . .

http://encyclopedia.thefreedictionary.com/Asset+stripping





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[Strelnikov_]

5. It Is The Basis Of GOP Economic Policy

The mob calls it a bust out.

Seize control, borrow against the value of the enterprise and pocket the proceeds, and when the bills come due, declare insolvency and move on.

[Eloriel]

7. Just like the S&L scandal

Arbusto, Harken, Ranger Field, Enron, GlobalCrossing, Tyco -- AND, let's not forget the U.S. Treasury under Bush2.

Actually, those are not necessarily good examples of asset stripping in its purest form. However, they ARE good examples of the kinds of high level theft of other people's money (as in stockholders, pensioners, 401K holders, and employees) that goes on in BushWorld.

[whistle]

6. And then there is the ultimate application of asset stripping known as...

...Vulture Capitalism

<link> http://www.hermes-press.com/vulture.htm

It's what happens when the economy goes from production based to knowledge based and why we have so much misinformation thrown at us.

[sweetheart]

8. It's a corporate scam for management

When you take an MBA programme, they'll go over the rules of accounting
so that you can "tweak" profitability in case you need to.

There are 2 ways to make money in a company, sell your
product/service, or sell the desk, and all the company property.
As major corporations usually have a great deal of assets, from
manufacturing machines to trucks and buildings, it is easy to fudge
the accounts to make it look like the company made money from
selling products, when in fact, you've been selling the family china.

It is called "asset stripping", as you've stripped the assets from
the company, and is generally seen as dodgey. However, it is
completely legal. Similarly in government, an administration will
do things like sell off the public water suppliers and sell off the
prisons to private companies. It is asset stripping of another sort,
called "privatization".

Honestly, the words do not convey the criminality behind such acts.
In legal terms, if the assets being sold are not legitimate, it is
really grand larceny, theft, and robbery. But such is white collar
crime, that it is seldomly to never charged by shareholders/ citizens.

Bush has stripped the assets out of our children's schools and
public services. He wasted the money on a war. He will not be
charged with the crime, but his actions are on a par with robbers.
... and hence the term: "robber barons."