Rising Star BearingPoint's is Fading Fast
It looks as if BearingPoint, the mega-consulting giant, could be disappearing as we once knew it.
The McLean-based company has filed for Chapter 11 bankruptcy protection, as it struggles to pay off its heavy debt. And trading of the company's stock, which is going for pennies these days, has stopped.
BearingPoint is probably best known for its government work, having done roughly $520 million in federal contracts in 2007. It has 15,000 employees worldwide, including 3,600 in the Washington area. But it has had to deal with a list of problems, including an accounting issue that lead to a 2005 SEC investigation. To stay afloat, BearingPoint took on the loans.
The company's name also popped up three years ago in questions about Lurita Doan, the former chief of the General Services Administration. Questions were raised inside the agency about whether Doan intervened in an effort to determine whether five major contractors, including BearingPoint, should be suspended from doing business with the federal government after they had been accused of making fraudulent claims. BearingPoint and the other companies had paid the Justice Department more than $66 million to settle allegations that they kept travel rebates from airlines and hotels that should have gone to the GSA, according to agency officials.
The company has done some mega deals like providing strategic planning and legislative support for a TSA worker ID program for 800,000 workers and has gone up against the likes of Lockheed Martin, Accenture and CSC. And a few years ago, it seemed like it was going to get over its accounting humps by cleaning up its books.
But now its future isn't looking so bright. My colleague Steven Pearlstein once said in a column that BearingPoint was "poised to become one of the brightest stars" of Northern Virginia's business scene. Judging by its past and current troubles, it seems like BearingPoint is trying to regroup and come up with a new strategy. In its current business state, it looks like its star has fallen.
By Sara Goo |
February 19, 2009; 10:29 AM ET
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