A costly nightmare for corporations

Chicago Sun-Times ^ | 4-7-05 | Robert Novak

[stan_sipple]

Ask nearly any business executive to name the biggest menace facing corporate America, and the answer is apt to be a number: ''404.'' That refers to Section 404 of the Sarbanes-Oxley Act, which requires massive reporting by publicly held companies to prevent recurrences of WorldCom, Enron, Tyco and other scandals. For honest corporate officers, this is classic governmental over-regulation -- a dagger aimed at the heart of the U.S. economy.

This is a peculiar state of affairs to be brought about by a government under Republican control. William H. Donaldson, the Bush-picked SEC chairman, sides with his commission's Democratic members in tightening the screws on business.

the word in Washington is that, as often is the case with regulators, the chairman has been co-opted by the commission's staff in making life difficult for corporations. That puts him in good company with the rest of the Republican-controlled government.

[stan_sipple]

More evidence that as long as Bush Administration officials repeat "Praise the Lord" often enough; it can get away with labelling minutemen "vigilantes" and anti-business regulation that would have made Jimmy Carter blush.

[NCjim]

Ask nearly any business executive to name the biggest menace facing corporate America, and the answer is apt to be a number: "404."

I thought this was going to be about the menace of the corporate web server going down...

[Sunshine Sister]

How come Global Crossing is never mentioned in this coversation?

[Dallas59]

I thought Bush was Pro Business?

[Dallas59]

I noticed the word "public"...

[proxy_user]

You might as well call this the 'Full Employment for Accountants, Consultants and Contractors Act'.

I do not see how this law requires Keon to be installed on all Unix machines, but that's what we're doing.

[stan_sipple]

Global Crossing: wasnt that the company Clinton boy Terry Mcauliffe made bank on?

[trebb]

So, what's the government to do? Letting corporations police themselves ended up with some crooks getting filthy rich as they put the screws to investors and ultimately the U.S. economy. Do nothing, and they get slammed for catering to big business at the expense of the little guy. Take action to make business accountable and they get slammed for hurting big business at the expense of the little guy. The only reason business would be inclined to hold onto money instead of investing it would be to find a way around the rules - if everything is legit, where's the problem? The article got a little shrill when it stated, "Beyond the cost is the climate of fear, with executives warned by auditors that inadvertent mistakes could mean a 25-year prison sentence. Financial analysts see this as the principal reason American corporations are hoarding cash, afraid to invest." Yepper - "inadvertant mistakes" good for 25 years in the slammer. After the "creative" auditing that brought the whole thing to a head, I find it amazing that anyone could make the statement.

At any rate, another case of "damned if you do; damned if you don't" for the Bush administration.

[Dallas59]

Not to mention honest employees and investors losing their jobs, savings, confidence.......

[wrathof59]

Bush is pro-business, and Nowak is definately a registered democrat who writes an anti-Bush column every second day, just like he did against the first Bush and Republicans before him.

Calling him a RINO would be a compliment, outside of his pro-capitalism at all costs attitude, he's solidly in the Democrats camp. He always was, I've been reading him for decades. He's anti-conservatist for a long time.

[Squawk 8888]

SAS-70 is the bane of my existence. Makes ISO9000 seem quaint.

[expat_panama]

There is a basic human tendency to be jealous of other people's wealth and decide that the only way other people can possibly have won is that they cheated.  After all, they can't possibly be smarter or harder working.  So then what happens is a mob forms and sends all rich people to the guillotine or the SEC or somewhere.

The fact is that most crimes are committed by poor people.

[Rebelbase]

SOX ping.

[stan_sipple]

Or with such overregulation of the public securities markets, all those big companies can have a few buffets own them privately. small start up enterprises will be scared away from raising capital through public securities markets

[FreedomAvatar]

Bush is pro business. To wit: "guest workers" streaming over the southern border.

[proxy_user]

I'll say. When the users report a production problem, we have to go through elaborate procedures before we can be issued a temporary password that allows us to log onto the production servers and see what is causing it.

Eventually someone is going to make a mistake, and they'll have a server no one can access. Yes, I know you can boot Unix in single-user mode from the console, but it will be quite embarrassing when that happens.

[PissAndVinegar]

I did at first glance as well but thinking about it, it's also very true.

I frequently purchase things from different web sites and if I get a 404 (page not found), something renders poorly or some other technical issue - they get no business from me.

My philosphy is if they can't get simple HTML to work and have a stable site, chances are there security is just as poor and I cannot trust them with my info.

[Sunshine Sister]

Exactly! He got millions before the company went down but because ole Terry boy is a democrat, there was nothing wrong with that. The huge double standard is glaring!

[lewislynn]

The fact is that most crimes are committed by poor people.

The subject is corporate crime...your excuse for them doesn't apply.

[Hop A Long Cassidy]

anti-Sarbanes-Oxley bump

The intentions of Congress critters were good, but the result has driven a stake at the heart of economic freedom and the ability of the U.S. to attract and sustain public companies.

These laws requiring excessive paperwork should be repealed and instead: allow publicly traded companies to be taken over more easily; restrict the appointment of CEO's friends to the boards of directors; continue prosecuting after-the-fact of those executives failing to file their full compensation details or hiding the details of fraud.

No amount of paper work is going to make someone honest and making the CEO totally responsible for any and all reporting of the company's financial results will just scare away the honest people - because they realize they will never be able to be in control of all the details of their large publicly traded comapanies.

Hoppy