Just because some (or maybe even most) regulation accomplishes little, it doesn’t mean that it isn’t necessary. Reinstating Glass-Steagall is probably a good step.
As far as fraud, legally there is fraud, and then there is fraud. Fraud usually has to be alleged with specificity. This makes ignorance of fraud a good defense. “I didn’t know the books were a POS. I hired a CPA firm, and heck the audit report is like 90 pages and I don’t understand all this accounting gobbledy-gook.”
Oxley/Sorbanes, to my recollection, was an attempt to cut down some on the ignorance defense. I will double check.
parsy, who will look that back up
I’ve said it before, but the cognitive dissonance of the neo-Conservative mindset is stunning. Personal behaviour (sex, drugs, and rock and roll) must be tightly regulated because the human beast cannot be let loose to behave in a way that might be destructive to the social fabric. But put that same human beast in the boardroom, and he should be left alone to do as he pleases, and the rest of us are expected to clean up the mess.
As somebody that's been intimately abused by Sarbanes/Oxley part 404 (AKA "the full employment for useless consultants act of 2002") in the IT industry for the last several years, I can offer many stories of wasted time and money over that time. SOX only "solved" the problem of too many American companies being too productive, and it fixed that with plenty of wasted man-hours and consulting fees, and endless paper-acres of documentation of things that nobody will ever read.
But beyond that, the Federal Reserve together with each of it's regional banks is already audited every year by an outside accounting firm (lately: Deloitte Touche) and the opinions and reports, with notes, are posted online for anybody to look at. I've looked at them. I still haven't heard from anybody what some other audit is supposed to reveal that their annual audit doesn't.
“Reinstating Glass-Steagall is probably a good step.”
Nope. That regulation was useless, dangerous, counterproductive and harmed our prosperity.
It prevented the useful combination of financial services products that other international bank enjoyed and as a result our banking sector fell behind others prior to the 1990s.
“Oxley/Sorbanes, to my recollection, was an attempt to cut down some on the ignorance defense.”
That regulation also has proved to be counterproductive and harmful to our prosperity. It killed the IPO market.
What a coincidence.