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Bush Signs Corporate Fraud Bill NewsMax.com WiresWASHINGTON – Corporate executives who scam investors or profit by cooking company books will be exposed and given "hard time" in prison under regulations President Bush signed into law Tuesday. Accounting firms are now forbidden from offering consulting services to clients if it posses a conflict of interest, and for the first time an independent oversight board has been established to oversee the industry. Chief executives under the Sarbanes-Oxley Act of 2002 would have to vouch personally, under penalty of law, for the honesty of earnings reports. Those reports must now be given quarterly. Executives also would not be allowed to buy or sell company stock when other employees are barred from doing so. "This new law sends very clear messages that all concerned must heed," Bush said at a signing ceremony in the White House East Room. "This law says to every dishonest corporate leader: You'll be exposed and punished. The era of low standards and false profits is over. No boardroom in America is above or beyond the law. "And this law says to every American: There will not be a different ethical standard for corporate America than the standard that applies to everyone else," Bush said. "The honesty you expect in your small businesses or in your workplaces, in your community or in your home will be expected and enforced in every corporate suite in this country." The Sarbanes-Oxley Act of 2002, named after its congressional sponsors, came in the wake of the Enron Corp., Global Crossing and WorldCom Inc. scandals that have shaken investor confidence and roiled the nation's stock markets. Although the markets appear to have calmed, if not regained a bit of confidence in the past several days, prices had plummeted steeply day after day following the disclosure that WorldCom had cooked its books by $3.8 billion. The slide affected markets around the world as confidence in America's economy sagged. "During the past year, the American economy has faced several sudden challenges and proven its great resiliency," Bush said Tuesday. "Terrorists attacked a center and symbol of our prosperity. A recession cost many American workers their jobs. And now corporate corruption has struck at investor confidence, offending the conscience of our nation. "Yet, in the aftermath of September the 11th, we refused to allow fear to undermine our economy, and we will not allow fraud to undermine it either. "... With a tough new law, we will act against those who have shaken confidence in our markets, using the full authority of government to expose corruption, punish wrongdoers and defend the rights and interests of American workers and investors." On hand at the signing were its sponsors, as well as Senate plurality leader Tom Daschle, D-S.D., and ranking Republican member Trent Lott, R-Miss. "This law gives my administration new tools for enforcement," Bush said. "We will use them to the fullest. We will continue to investigate, arrest and prosecute corporate officials who break the law. The Corporate Fraud Task Force I established is now hard at work overseeing investigations of alleged fraud and insider trading. "Every corporate official who has chosen to commit a crime can expect to face the consequences. No more easy money for corporate criminals, just hard time." Copyright 2002 by United Press International. All rights reserved.
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