Ex-Exec Settles Insider-Trading Charges

The Securities and Exchange Commission has settled illegal insider-trading charges with Evan S. Collins, a former finance executive of Network Associates Inc. Once a high-flying technology company, Network Associates is now known as McAfee Inc., after the antivirus software for which it is still ...

By Stephen Taub • Dec. 2, 2004

Judge Rules Against Scrushy over Sarbox

Score this round to the scribes of the Sarbanes-Oxley Act. In the first court challenge against the landmark corporate governance law, a federal judge ruled against former HealthSouth chief executive Richard Scrushy, who had asserted that several charges accusing him of falsely certifying the hea...

By Stephen Taub • Dec. 1, 2004

Off with CalPERS’ Head?

Sean Harrigan, president of the California Public Employees’ Retirement System (CalPERS), the nation’s largest pension fund, thinks he will be fired today as a result of his strong activist agenda, according to the Los Angeles Times.Harrigan, a regional executive for the United Food and Commercia...

By Stephen Taub • Dec. 1, 2004

Oracle Execs Cleared of Insider Trading

Oracle Corp. chairman and former chief financial officer Jeff Henley and chief executive Lawrence Ellison have been cleared of charges of illegally trading on insider information, according to the Associated Press.The two executives won a summary decision in a lawsuit stemming from trades execute...

By Stephen Taub • Dec. 1, 2004

Courts and Torts: Vetting Compensation

Even the The Incredibles would have a hard time rescuing the Walt Disney Co.’s compensation committee from their current predicament. In a trial eight years in the making, Disney shareholders are seeking $200 million in damages from board members and one-time president Michael Ovitz, alleging tha...

By Marie Leone • Nov. 30, 2004

The High Costs of Sarbox Compliance

Companies are being hit with a surge in costs stemming from their efforts to comply with the Sarbanes-Oxley Act, two surveys released last week found. But many of the companies aren’t sure what those efforts are achieving. For example, a survey of almost 270 board directors at U.S. companies rel...

By Stephen Taub • Nov. 29, 2004

Bond Insurer Is Latest Probe Target

The government’s probe of the insurance industry has extended to a major insurer of bonds.Last week, a day after completing the sale of $350 million of 30-year bonds, MBIA Inc. reported that it received identical subpoenas from the Securities and Exchange Commission and the New York Attorney Gene...

By Stephen Taub • Nov. 23, 2004

OSHA Orders Controller to be Rehired

A former finance executive of an industrial-products company has regained his job and will receive back wages under the whistle-blowing provision of the Sarbanes-Oxley Act. The Department of Labor’s Occupational Safety and Health Administration (OSHA) has ordered the American Standard Cos. and su...

By Stephen Taub • Nov. 19, 2004

New Spitzer Initiative Against Insurers

New York Attorney General Eliot Spitzer has expanded his probe of the insurance industry to companies specializing in life, accident, and disability insurance.Spitzer has filed a civil complaint against Universal Life Resources Inc. (ULR), alleging that the company steered business to insurers in...

By Stephen Taub • Nov. 17, 2004

Former Boeing CFO Pleads Guilty

In a federal court in Alexandria, Virginia, former Boeing Co. chief financial officer Michael Sears pleaded guilty yesterday to a felony count involving the illegal hiring of a top Air Force procurement officer, according to wire-service reports. In October 2002, Darleen Druyun — then the Air For...

By Dave Cook • Nov. 16, 2004

SEC Charges Hollinger, Two Executives

The Securities and Exchange Commission filed a fraud complaint on Monday against Hollinger International Inc. former chairman and chief executive officer Conrad M. Black, former deputy chairman and chief operating officer F. David Radler, and Hollinger Inc., the parent company that Black had cont...

By Stephen Taub • Nov. 16, 2004

Sarbox 404 Goes into Effect Tomorrow

Although many companies are reportedly not ready for it, the era of internal-controls compliance begins in earnest tomorrow. That’s when Section 404 of the Sarbanes-Oxley Act goes into effect for all companies whose fiscal year ends after today.There will be nothing to file on Tuesday. But by ear...

By Stephen Taub • Nov. 15, 2004

Deloitte Sued for $2 Billion

Deloitte & Touche LLP could be on the hook for as much as $2 billion if it loses a legal claim related to the use of insurance products that are under investigation by government regulators, The Wall Street Journal reported. The brewing legal battle is based on so-called earnings-management i...

By Stephen Taub • Nov. 12, 2004

Three Companies Probed On Bribe Charges

The Securities and Exchange Commission is currently investigating at least three major, multinational companies for allegedly bribing foreign officials.In its quarterly filing, Bristol-Myers Squibb Co. disclosed that in late October the SEC launched an informal inquiry into the activities of the ...

By Stephen Taub • Nov. 11, 2004

Risks and Benefits: Braking the Brokers

Do corporate finance executives really need an insurance broker to stand between them and their companies’ insurers?Amid the hubbub surrounding New York Attorney General Eliot Spitzer’s probe of bid-rigging and business-steering in the insurance industry, that basic question isn’t being asked muc...

By David Katz • Nov. 11, 2004

After the Storm

The four hurricanes that devastated Florida this summer packed a bigger punch than Andrew, 1992’s monster storm. Together, Charley, Frances, Ivan, and Jeanne racked up more than $20 billion in insured property damage, compared with Andrew’s $15.5 billion. The number of claims from the hurricanes ...

By Ilan Mochari • Nov. 11, 2004

Sarbox Support Groups

Sometimes you need a sympathetic shoulder to cry on. As companies struggle to comply with Section 404 of Sarbanes-Oxley, which requires them to document and obtain audits of their internal controls, some finance executives are organizing peer groups to share experiences, compare notes on their au...

By Joseph McCafferty • Nov. 10, 2004

SEC Probing Reports of Pension Conflicts

The Securities and Exchange Commission is turning up the heat on pension consultants to determine whether conflicts of interest exist between the consulting firms and the money managers they recommend to clients, the Wall Street Journal reported.The SEC opened an enforcement investigation to dete...

By Stephen Taub • Nov. 10, 2004

Conference Calls Can Air Dirty Laundry

During a conference call to discuss second-quarter results at Sears, Roebuck & Co., CEO Alan Lacy was prepared for a barrage of questions from analysts about why the company missed earnings expectations. What he was not prepared for was a question from an irate customer who had a bad experien...

By Joseph McCafferty • Nov. 9, 2004

The Telephone Game

It’s been just over two years since Sarbanes-Oxley began requiring companies to provide employees with a way to anonymously report financial misdeeds. In practice, that has usually meant setting up telephone hotlines, most of them open to any type of ethics complaint. But along with each call abo...

By Tim Reason • Nov. 8, 2004

Bribes and the Balance Sheet

Presentations in hand, six members of a U.S. architecture firm flew to London this year to meet with a high Russian provincial official. About three months earlier, the politician had asked the firm to submit a proposal to develop a waterfront area in the province. But when the architects arrived...

By David Katz • Nov. 8, 2004

Votes All Counted in First Enron Trial

In federal court in Houston, a jury convicted five of six defendants in the first criminal trial involving former energy giant Enron Corp. Four former executives of Merrill Lynch — James A. Brown, Daniel Bayly, William Fuhs, and Robert Furst — and a former mid-level Enron manager, Dan Boyle, were...

By Dave Cook • Nov. 4, 2004

Laggards Warned on Sarbox 404 Compliance

This summer, CFO.com reported that many companies were falling behind in their preparations for Section 404 of the Sarbanes-Oxley Act. (See “No Vacation from Section 404 Prep Work.”) Section 404 — which will guide how auditors report on companies’ assessments of their internal controls — becomes ...

By Stephen Taub • Nov. 3, 2004

SEC Enlivens ‘Quiet Periods’

The Securities and Exchange Commission has proposed rules that would allow the largest companies to do a lot more talking before they issue shares of stock. The new regulations would permit some executives to take part in interviews and possibly allow companies to advertise offerings on televisio...

By Stephen Taub • Oct. 28, 2004

Big Data Issues at Smaller Companies

Many data-management requirements, most notably the dictates of Sarbanes-Oxley, initially applied only to large public corporations, but their effects are already trickling down to small and midsize businesses (SMBs). These firms must manage data just as professionally as the big guys, providing ...

By Anne Stuart • Oct. 27, 2004