Mistrial for Michael Rigas

The case of former Adelphia Communications Corp. vice president Michael Rigas ended in a mistrial Friday, a day after his father and brother were convicted on multiple counts of fraud.Michael Rigas was acquitted of conspiracy and wire fraud charges, according to Bloomberg, but the jury could not ...

By Dave Cook • July 12, 2004

Novartis CEO Rails at Sarbox

The chief executive officer of drug giant Novartis has publicly criticized the Sarbanes-Oxley Act, according to the Associated Press.Daniel Vasella, the head of the Basel, Switzerland-based company, said during a visit to Singapore that the standards are onerous for any company that does business...

By Stephen Taub • July 12, 2004

Office Politics

It took the Watergate scandal to convince Congress to put an end to direct contributions from companies to federal politicians. It took 30 years and another scandal — Enron — to stop the resulting flow of so-called soft money from corporate coffers to political parties.That doesn’t mean the corpo...

By Tim Reason • July 12, 2004

Adelphia Executives Convicted

John Rigas, the founder of Adelphia Communications Corp., and his son Timothy, the former chief financial officer, have been found guilty of looting the cable company and deceiving investors, according to reports.They were convicted on 18 counts of securities fraud, bank fraud, and conspiracy, ac...

By Dave Cook • July 9, 2004

Martha Stewart Denied New Trial

Domestic diva Martha Stewart faces sentencing next week after being denied a new trial, according to published reports.In March, a jury found Stewart guilty of one count of conspiracy, two counts of making false statements, and one count of obstruction of agency proceedings in her trial over a su...

By Stephen Taub • July 9, 2004

Kenneth Lay Indicted on 11 Counts

After months (if not years) of speculation, former Enron chairman and chief executive officer Kenneth Lay was indicted for his role in the collapse and bankruptcy of the one-time high-flying energy giant.A handcuffed Lay was paraded in front of TV cameras early Thursday after surrendering to the ...

By Stephen Taub • July 9, 2004

Name Game

Don’t be surprised to see the names of jurors in the first Enron case pop up in press coverage of the trial. That’s because a federal judge has denied the prosecution’s request to keep them secret.U.S. District Court Judge Ewing Werlein Jr. didn’t find that the case — which concerns an alleged sh...

By Joseph McCafferty • July 9, 2004

Bank of America Settles Enron Suit

Bank of America has announced that it will pay about $60 million to settle a class action lawsuit, led by the regents of the University of California, on behalf of investors in Enron securities.Unlike a number of other financial institutions, Bank of America had relatively small dealings with Enr...

By Stephen Taub • July 7, 2004

The Tortinator

Can California governor Arnold Schwarzenegger stem excessive jury awards against corporations? In May, his latest budget revision included an unexpected proposal to generate $450 million in state revenue by taking a 75 percent slice of punitive-damage awards from individual lawsuits.Punitive dama...

By Tim Reason • July 7, 2004

Donaldson’s Former Company Probed by SEC

A company whose audit committee formerly included Securities and Exchange Commission chairman William Donaldson confirmed published reports that it is being investigated by the SEC.EasyLink Services Corp., a provider of electronic information exchange services, said Thursday that the SEC is revie...

By Stephen Taub • July 6, 2004

Compliance Creep

It used to be that shorter monthly closes were considered a best practice. But these days, shorter is relative.Thanks to increases in compliance demands and an internal focus on reliability, closes are actually getting longer. New data from The Hackett Group’s 2004 “Finance Book of Numbers,” in f...

By Lori Calabro • July 6, 2004

Democratic Reps. Weigh In on Proxy Rules

Six key Democratic members of Congress called for the Securities and Exchange Commission to issue new rules that would provide large investors more access to the process of nominating a board of directors.The representatives see such a measure as a deterrent to scandal. “Adoption of this rule wou...

By Stephen Taub • June 30, 2004

SEC Charges Siebel, CFO, with Reg FD Breaches

The Securities and Exchange Commission has charged Siebel Systems Inc. with violating its Regulation Fair Disclosure (FD) rule for the second time since the rule went into effect less than four years ago, according to Reuters.The commission also charged Kenneth Goldman, the software company’s CFO...

By Stephen Taub • June 30, 2004

Former CFO Faces Time for Embezzlement

The former chief financial officer of the University of Florida Foundation pleaded no contest to charges that he wrote himself five checks worth $850,000 from foundation accounts, according to the South Florida Sun-Sentinel.Kenneth Hillier, who had worked for the foundation for 16 years and had d...

By Stephen Taub • June 29, 2004

SEC to Publish Comment Letters Online

The Securities and Exchange Commission will make available on its Web site the thousands of pieces of correspondence concerning company and mutual-fund filings reviewed by the SEC’s Corporation Finance and Investment Management divisions.The SEC will start releasing comment letters and responses ...

By Stephen Taub • June 28, 2004

Big GAAP, Little GAAP

Small companies are feeling the pinch of increased regulation these days. Many CFOs of small businesses say they are being unfairly punished for the indiscretions of such large companies as Enron, WorldCom, and Tyco by having to implement new rules that are disproportionately time-consuming and c...

By Joseph McCafferty • June 28, 2004

Career Education Corp. Faces SEC Probe

Career Education Corp. reported that it received a formal order of investigation from the Midwest Regional Office of the Securities and Exchange Commission .The company, which operates 80 colleges and universities in the United States and overseas, said it intends to continue to fully cooperate w...

By Stephen Taub • June 24, 2004

SEC Settles with Two Former Qwest Execs

The Securities and Exchange Commission settled civil fraud charges against two former Qwest Communications International, Inc. officers. The charges involved the alleged roles of the ex-officers in helping the telecom overstate revenues.Augustine Cruciotti, a former senior vice president of Qwest...

By Stephen Taub • June 24, 2004

Lay’s Attorney on the Offensive

Over the weekend, the Houston Chronicle reported that in about two weeks, U.S. prosecutors will ask a federal grand jury to hand up an indictment of former Enron Corp. chairman Kenneth Lay.Rather than sit back, Lay’s attorney — Mike Ramsey — has gone on the offensive. Ramsey called a press confer...

By Stephen Taub • June 23, 2004

You Bought It, Now Audit

These days, audits are rarely a source of solace, but finance executives who find IT daunting may actually be relieved to know that IT audits are suddenly in vogue, and provide exactly the sort of big-picture view that most CFOs need. IT audits are not, as you may have guessed, a matter of pure a...

By Bob Violino • June 23, 2004

Donaldson Rails at Proxy Critics

William Donaldson, chairman of the Securities and Exchange Commission, lashed out at critics of the SEC’s proposed rules that would open up the proxy process.In a speech over the weekend to a meeting of corporate directors at Stanford University, Donaldson decried the “escalating, shrill, and fea...

By Stephen Taub and Joseph McCafferty • June 22, 2004

Former HealthSouth CFO Gets Probation

If you are one of the scores of top corporate executives who have been accused of committing accounting fraud during the past few years, the best place to have performed these transgressions, it seems, was at HealthSouth Corp.Even though the government has boasted that it quickly extracted guilty...

By Stephen Taub • June 22, 2004

Beware the ”Trash” Folder

As more and more business becomes documented in E-mail rather than memos and reports, document retention becomes a challenge on several levels. Whether it’s compliance with the Sarbanes-Oxley Act of 2002, Securities and Exchange Commission regulations, or laws governing the handling of patient da...

By John McPartlin • June 22, 2004

Proxy Season Quieter in 2004, Says ISS

The 2004 proxy season was less confrontational than it has been in recent years, according to an analysis by research firm Institutional Shareholder Services.In fact, said the ISS, the trend this season saw corporations listening to and acting upon reasonable shareholder concerns. Sure, there wer...

By Stephen Taub • June 18, 2004

Andersen Conviction Upheld on Appeal

A federal appellate court in New Orleans unanimously upheld the two-year-old jury conviction of accounting firm Arthur Andersen for obstruction of justice related to its client Enron, according to the Houston Chronicle.Andersen was convicted on June 15, 2002. That October, U.S. District Judge Mel...

By Stephen Taub • June 18, 2004