No, it is not true. You have to understand in the corporate world (and the military) there tend to be a lot of tribal stories made up to scare people about things that are not really true. These tribal beliefs can extend up and down the chain of command. For example, one place I worked for I kept being told the policy was to "never ever install anything anywhere for any reason... you could get fired." This was even though I read the black and white policy which said not to install pay for or trial software. Why would they make the distinction if the supposed rule is "never ever?" Tribal beliefs are near impossible to change.
There would need to be special hardware on the usb ports of the computers in order to "kill" attached devices. The only thing that I could think of to actually do this would be some sort of high voltage spike to destroy the physical components of the flash drive and something like that is too inspector gadgetish for me to believe. Even if they did install something like that I would think they'd run the risk of injuring their employees with the fireworks that could potentially result. Really, you have to be able to ignore a lot of garbage people tell you, or at least remember to "trust, but verify."
The only thing it could do would be to wipe as Xantac guessed, and I think even that is highly unlikely. Users with knowledge could easily stop such a script.
