Global Crossing

DEFINITION of 'Global Crossing'

A communication services company that filed for bankruptcy protection amid an accounting scandal where it had allegedly inflated earnings by using capacity swaps, among other things. Capacity swaps are the exchange of telecommunications capacity between carriers that is booked as revenue without money ever being exchanged.

BREAKING DOWN 'Global Crossing'

This scandal happened around the same time as the Enron transgression. In early 2002, the Global Crossing bankruptcy was the fourth largest in U.S. history. In 2005, it settled with the SEC, having been determined that it did not comply with numerous accounting laws and is to refrain from violating any other accounting laws.

RELATED TERMS
  1. Aggregate Capacity Management

    The process of planning and managing the overall capacity of ...
  2. Capacity Requirements Planning ...

    An accounting method used to determine the available production ...
  3. Capacity Management

    The management of the limits of an organization's resources, ...
  4. Fiscal Capacity

    In economics, the ability of groups, institutions, etc. to generate ...
  5. Bilateral Netting

    The process of consolidating swap agreements between two parties ...
  6. Reverse Swap

    An exchange of cash flow streams that undoes the effects of an ...
Related Articles
  1. Investing

    Calculating the Capacity Utilization Rate

    Capacity utilization rate is a ratio used to compare a current usage level against a maximum potential level.
  2. Trading

    Currency Swap Basics

    Find out what makes currency swaps unique and slightly more complicated than other types of swaps.
  3. Is It Time To Short This Industry Favorite?

    A combination of capacity growth, higher fuel prices and worries about the health of the global economy have sent airline stocks skidding this year. The US Global Jets ETF (NYSE:JETS) is down ...
  4. One Airline Ready To Fly Higher And One Not Cleared For Takeoff

    A combination of capacity growth, higher fuel prices and worries about the health of the global economy have sent airline stocks skidding this year. The US Global Jets ETF (NYSE:JETS) is down ...
  5. Markets

    What is Capacity Utilization Rate?

    The capacity utilization rate shows how much a firm or economy is producing as a percentage of what it’s capable of producing.
  6. Investing

    Playing The Sleuth In A Scandal Stock

    Learn the legwork involved in finding out whether your investment can weather a storm.
  7. Markets

    What's an Interest Rate Swap?

    An interest rate swap is an exchange of future interest receipts. Essentially, one stream of future interest payments is exchanged for another, based on a specified principal amount.
  8. Investing

    Different Types of Swaps

    Investopedia explores the most common types of swap contracts.
  9. Managing Wealth

    How To Read Interest Rate Swap Quotes

    Puzzled by interest rate swap quotes terminology? Investopedia explains how to read the interest rate swap quotes
  10. Personal Finance

    Bankruptcy

    Learn what happens when an individual or an organization files for bankruptcy.
RELATED FAQS
  1. When was the first swap agreement and why were swaps created?

    Learn about the history of swap agreements, the first swap agreement between IBM and the World Bank, and how swaps have evolved ... Read Answer >>
  2. What would motivate an entity to enter into a swap agreement?

    Learn why parties enter into swap agreements to hedge their risks, and understand how the different legs of a swap agreement ... Read Answer >>
  3. Can bond traders trade on interest rate swaps?

    Read about interest rate swaps and why these transactions are performed by institutional actors in the bond market, not individual ... Read Answer >>
  4. What are some risks a company takes when entering a currency swap?

    Read about the risks associated with performing a currency swap, including counterparty credit risk in the event that one ... Read Answer >>
  5. How are swap agreements financed?

    Learn how swap agreements are now cleared by swap execution facilities and require the use of collateral margin to hold, ... Read Answer >>
  6. How do companies benefit from interest rate and currency swaps?

    An interest rate swap involves the exchange of cash flows between two parties based on interest payments for a particular ... Read Answer >>
Hot Definitions
  1. GBP

    The abbreviation for the British pound sterling, the official currency of the United Kingdom, the British Overseas Territories ...
  2. Diversification

    A risk management technique that mixes a wide variety of investments within a portfolio. The rationale behind this technique ...
  3. European Union - EU

    A group of European countries that participates in the world economy as one economic unit and operates under one official ...
  4. Sell-Off

    The rapid selling of securities, such as stocks, bonds and commodities. The increase in supply leads to a decline in the ...
  5. Brazil, Russia, India And China - BRIC

    An acronym for the economies of Brazil, Russia, India and China combined. It has been speculated that by 2050 these four ...
  6. Brexit

    The Brexit, an abbreviation of "British exit" that mirrors the term Grexit, refers to the possibility of Britain's withdrawal ...
Trading Center