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Politics : Stockman Scott's Political Debate Porch -- Ignore unavailable to you. Want to Upgrade?

To: T L Comiskey who wrote (2374)	7/17/2002 1:35:01 AM
From: stockman_scott	Read Replies (1) \| Respond to of 89467

Senate approves corporate overhaul 97-0 By Jim Drinkard, USA TODAY 07/16/2002 - Updated 12:25 AM ET WASHINGTON — The Senate voted 97-0 Monday for tougher regulation of the accounting industry and new criminal penalties for financial fraud by corporate executives. The changes, propelled by a plunging stock market and fear of political consequences, appear likely to move quickly through House-Senate negotiations. If made law, they would amount to the most sweeping overhaul of accounting since the Great Depression in the 1930s. Nearly dead three weeks ago, the bill was revived by disclosure of financial misdeeds at WorldCom and Wall Street's downward spiral. President Bush applauded the Senate action for including "all of the accounting and criminal reforms I proposed." The bill also included provisions Bush did not support. He asked Congress to deliver a compromise bill to him before its summer break in August. "It's not an exaggeration to say the crisis in our markets has put the plans and hopes and dreams of millions of Americans at risk," said Senate banking committee Chairman Paul Sarbanes, D-Md. The bill is "an essential step toward restoring confidence." The House of Representatives passed a less-sweeping accounting reform measure in April, before the latest disclosures of corporate financial misconduct fanned support for tougher regulation. Bush endorsed that bill. But Senate Minority Leader Trent Lott, R-Miss., said that in the past week, both Bush and House Speaker Dennis Hastert, R-Ill., told him the tougher Senate bill "is within the range they can support." A spokeswoman for House Financial Services Committee Chairman Michael Oxley, R-Ohio, said lawmakers would try to meet the president's timetable. The bill that went before the Senate a week ago dealt primarily with accounting abuses that figured in a string of corporate scandals from Enron to WorldCom. But in an atmosphere of growing anxiety about the economy, the Senate transformed it into a broader corporate responsibility initiative. It includes: An independent board to set standards for the accounting industry. The board would be named by the Securities and Exchange Commission. Limits on the consulting services accounting firms can perform for their audit clients. In the case of Enron, accounting firm Arthur Andersen earned as much for consulting as it did for auditing. Critics say that created a conflict of interest. New criminal penalties of up to 10 years in jail for corporate financial fraud and obstruction of justice involving shredding documents. Penalties would be increased for mail, wire and pension fraud. A requirement that corporate chief executives and chief financial officers personally attest to the accuracy of their financial reports. A ban on companies making some personal loans to executives and directors, a provision Bush has called for. As a director of the Texas company Harken Energy in 1990, Bush received a company loan to buy stock that he later sold at a profit. usatoday.com