We’ve written at length how the Obama Administration claim that it couldn’t prosecute bank CEOs and senior executives because they didn’t do anything illegal is utter hogwash. Sarbanes Oxley, passed in the wake of Enron, was designed to prevent CEOs and other top executives from escaping liability by claiming they were clueless face men. And it provides for a clear path to criminal prosecutions.
But the way Sarbanes Oxley was defanged is by making it an exercise in form over substance. Public firms engage in compliance theater while the SEC sits on its hands as far as enforcement is concerned (Note that the SEC did fail on its lone effort to use Sarbox against a CEO in the case of Richard Schrusy and Healthsouth. But that case was tried before a jury in Birmingham, Alabama, and I will spare readers the long form account as to why you can’t generalize from these results). Both the MF Global collapse and the JP Morgan Chief Investment Office fiasco look like slam-dunk Sarbox cases, yet we’ve seen nary a sign of interest from the SEC.
Occupy the SEC has used House Financial Services Committee hearings this week on the tenth anniversary of the passage of Sarbanes Oxley to raise pointed questions as to why the SEC has not launched a probe of JP Morgan. I have a sneaking suspicion that this line of thinking won’t get any air time, and instead the Congresscritters will focus on how the nasty law inconveniences fine upstanding major corporations.
I hope you’ll read their succinct and forceful letter.
Occupy the SEC Letter to the House Financial Services Committee on Sarbanes Oxley
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The occupy letter is hosed on my browser.
You can click on the link and download it. That’s what I generally do with these embeds once I’ve looked at the first page and decided they are of interest.
Yes indeed, a very well written and worth while read.
Thank you OCCUPY the SEC .org
I saw a woman, Alexis Goldstein from Occupy the SEC on “Up” two weeks ago. Extremely succinct and articulate. She devastated some jerk from Bain Capital, Edward Canard,who kept insisting that most bankers were just swell. She had help from Bill Black, but I was really impressed with her. A fresh new voice.
That Canard (nice to see a person live up to his/her name) has a book out, too, claiming that everything we learning about the meltdown is wrong.
She was also on Lauren Lyster’s “Capital Account” on RT.COM talking about the Volcker rule. She is one kickass lady.
This is fantastic stuff.
Does anyone know if this was sent to any of the major media or anyone other than the HFS Comm. and the SEC itself?
You could wallpaper the news rooms at WAPO and NYT with the letter and it will still at most get a page 11 mention–more than likely they will ignore it.
I know, I know. But putting it under their noses means you can then call them out for deliberately ignoring it. That’s how we got our local paper to cover the Downing St. Memos back in 2005. Not that it mattered in the final analysis.
It would be interesting to have someone like Bill Moyers pose the facts nicely laid out in this letter as a hypothetical and ask him whether (hypothetically) he believes a prosecutable SOX violation has occurred.
The Moyers interlocutor would be Neal Barofsky.
Argh, sorry about that.