The Company: Was once one of the 'Big Five' accounting firms in the United States, providing auditing, tax, and consulting services to some of the largest businesses in the United States.
The Mistake: Cooking the books. Arthur Andersen was the accountant for the companies, Enron, Worldcom, Sunbeam and several other companies that participated in 'creative accounting'. As accountants they were responsible in making sure that all their client's accounts were legal and in order. But as their consultants, they often advised their clients in how to hide debt.
The Aftermath: After the collapse of Enron, the United States Department of Justice decided to go after Arthur Andersen and prosecuted the company for obstruction of justice. The company decided to gamble and fight in court but was eventually convicted. Even though the conviction was eventually overturned, the damage to the company's reputation was too severe and in 2011 had only 200 employees from a high of 85,000.