Friday, April 11, 2008

The Changing Atmospherics of Corporate Crime Sentencing in the Post Sarbanes-Oxley Act Era

The Sarbanes-Oxley Act of 2002 has been viewed as a watershed event in dealing with corporate fraud. In addition to its extensive provisions dealing with internal controls and corporate accounting procedures, the law adopted new crimes and pushed the United States Sentencing Commission to enhance the Federal Sentencing Guidelines provisions for fraud and related offenses. Even before the adoption of the Act, the Commission had increased the potential punishment for white collar crimes by amending the loss table for fraud offenses. These two steps played a key role in the increased sentences imposed on defendants convicted for their role in corporate crimes, such as Bernie Ebbers (twenty-five years) and John Rigas (fifteen years). The Sarbanes-Oxley Act maked a change in the sentencing atmospherics for corporate crime that propelled judges to give out sentences that were unthinkable even five years earlier.

This article considers how the Sarbanes-Oxley Act changed the approach to sentencing of white collar defendants involved in corporate crimes.

The Changing Atmospherics of Corporate Crime Sentencing in the Post Sarbanes-Oxley Act Era

Labels: corporate scandal, fraud, penalties, white-collar crime

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Wednesday, December 05, 2007

Subprime Mess Could Be Bigger Than Enron

As the subprime mortgage meltdown grows, some experts are starting to see the resulting fallout rivaling corporate scandals of earlier this decade, like Enron, that prompted the passage of the Sarbanes-Oxley Act.

Even former Securities and Exchange Commission Chairman Arthur Levitt expects to see more massive writedowns on the way. He believes banks aren’t being candid about the full extent of their subprime mortgage holdings. Last week, he told Bloomberg News that he thinks the Financial Accounting Standards Board should force the banks to close a loophole that lets them keep the structured investment vehicles holding subprime debt off their balance sheets.

Subprime Mess Could Be Bigger Than Enron

Labels: corporate scandal, mortgage, subprime

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