I live in Denver now, but grew up near Indianapolis. There were two companies everybody wanted to work for there: pharmaceutical firm Eli Lilly (NYSE:LLY) and insurance company Conseco (NYSE:CNO).

Lilly was the font of employment stability, even if the stock was far from it. (If you got on at Lilly, you had a job for life, was the thinking.) People wanted to work for Conseco because they recruited aggressively and were always hiring. That was something uncommon to the city. They hired a lot of local college graduates, including my wife and many of my friends.

Conseco is one of my favorite companies, not as an investment, but because there's no better example of what a company and its leaders can do wrong. It's every wrongdoing rolled into one company. The list is too long for a Fool take, but if I were ever to write a book, Conseco is on the shortlist of topics. I am referring to the company prior to its reorganization under bankruptcy protection and the ousting of its founding leader, Steve Hilbert. If it weren't for the sheer size and potential for disruption to the capital markets, the Long Term Capital Management story is boring by comparison.

The question now is whether or not the company will be able to overcome its troubled history. I contend that it's not in the clear yet, because the problems are so deeply ingrained in the structure of the company. Aside from the greed and waste, the company made bad fundamental business decisions.

Essentially, what it did was to borrow money to buy profitable, smaller insurance companies under the guise that it would make them more efficient and profitable. Then, it would skim the profits to pay the loans. Eventually, having all their profits robbed, the acquired companies would begin to struggle. Then Conseco would dismantle them, moving the operations and policies to the home office. It simply repeated this process over and over again until its debt levels became too great. The purchase of Green Tree just helped to tip it over the edge.

Now Conseco's new leadership is dealing with cleaning up the tangled mess left behind. It's a daunting effort, like cleaning up a bomb-testing range. No one can guarantee that the area is completely safe again. The company has had to rebuild itself from the ground up.

The company released its first-quarter earnings this morning. Revenue declined 10% to $1.1 billion, but the company reported a profit $73 million compared to a year-earlier loss of $19 million. Last year's results were reported under bankruptcy though, so it's not directly comparable.

Conseco seems to be on the right track now, but what was clear in the report is that it is still very much in the rebuilding process and is humble about the work ahead. The report ends with this quote from the company's CEO Bill Shea, "As managers and associates, we recognize that we have an opportunity to recreate a viable and valuable company with which all of us can be proud to be associated." Perhaps he should have said "reinvent."

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Fool contributor Mark Mahorney doesn't own shares of any companies mentioned.