A firm can be financed with debt or equity. Issuing bonds to buy back stock is simply changing the structure of how the firm is financed. It does not have a moral component.
Where is the fraud?
Where is the fraud?
But I would not buy stock only for the company to do buy-back programs for other shareholders, especially not if the company would be in a worse shape (i.e. less net worth of its assets and debts) afterwards.
A firm has assets and operations and those are funded with either debt or equity. Borrowing money to buy back stock is simply changing the capital structure of the firm.
I find it amusing that everyone has sympathy for the the shareholders (who were given an opportunity to get out), while no one seems to feel a bit of sympathy for the bond holders. If anyone was defrauded (and personally I don't believe anyone was) it was them.