Lay and Ski
lling, the crooks who ran Enron into the ground, may be sentenced to terms in excess of 100 years each--and they were not prosecuted for any violations of the Sarbanes Oxley provisions they inspired.The law was an overreaction that is taxing America unnecessarily. It reduces innovation and entrepreneurship at the same time that, in my opinion, it does little or nothing to reduce crime in the board room.
Don't get me wrong, I think that corporate wrongdoers like Lay and Skilling, among many others (I lost money in WorldCom) should be prosecuted to the fullest extent of the law, but I don't think making the same actions criminal in more ways reduces the crime. Strict and vigorous enforcement of existing laws would have been sufficient reaction.
Today, we see entrepreneurial companies going public abroad in order to avoid the overly regulated markets in the U.S. This means that U.S. regulators will have very little influence over the offering documents, the public reporting or most of the other provisions of our foundational securities laws: the 1933 and 1934 acts.
I don't believe that the U.S. is well served by effectively forcing U.S. companies to go public abroad to avoid U.S. regulations.
What do you think?
From my limited perspective, it would seem that the rush to legislation that followed in the wake of the Enron / Anderson (et al) melt-down failed to address the the fundemental issues: a failure to enforce existing laws by a string of executive branches too beholden to corporate interests, and a fourth estate too lazy to educate the public on it. And laws can't really address an executive branch that can't be bothered with enforcing them.
So while I'm dubious of the value of new laws in a world where the old ones were ignored, I'm not willing to dismiss the particulars of S/A out-of-hand... but will say only that a new law is useless.
On the point you make at the onset, however, I would submit that the Lay/Skilling verdict only points-up the dearth of enforcement... well, that, and that juries will convict at least the most heinous and bald of perpetrators.
So I can't grant your premise... but I'll gladly join you at the bar to bellyache about S/A — though for different reasons.
Posted by: Silus Grok | May 26, 2006 8:47 AM | Permalink to Comment