Ivar Kreuger and IMCO: A case of taxation of fictitious income

Sandra Kramer and Gary John Previts

The International Journal of Accounting, 2015, vol. 50, issue 3, 300-315

Abstract: This paper relates an episode of epic capital market fraud that previous research has linked to major twentieth-century legislative reforms of U.S. capital markets. In 1932, following the suicide of Ivar Kreuger, the companies representing two of the most popular and arguably the most widely distributed securities in the world, the Swedish holding company Kreuger & Toll AB and its U.S. subsidiary, International Match Company (IMCO), filed for bankruptcy. IMCO, the focus of this study, was alleged by bondholders' legal counsel to have overstated financial income and substantially overpaid federal income taxes. IMCO paid nearly $6 million in income taxes, the current equivalent of over $85 million.

Keywords: Kreuger; Fraud; Income tax refund (search for similar items in EconPapers)
Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:eee:accoun:v:50:y:2015:i:3:p:300-315

DOI: 10.1016/j.intacc.2015.07.004

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