Can’t Pay or Won’t Pay?

No part of the financial crisis has received so much attention, with so little to show for it, as the tidal wave of home foreclosures sweeping over America. Government programmes have been ineffectual, and private efforts not much better. Now it is Barack Obama’s turn. On Wednesday February 18th ...

By Economist Staff • Feb. 19, 2009

Eastern Leaders Ask for Help from the Eurozone

Politicians from central and eastern European countries are calling for greater help — and understanding — from the eurozone for their struggling economies.Mikolaj Dowgielewicz, Poland’s minister for Europe, said that while members of the eurozone were being allowed to depart from the rules of th...

By European Voice Staff • Feb. 19, 2009

Fed Sees Economic Slide, Moving Target for Stimulus

The Federal Reserve is ratcheting up its projection for U.S. economic deterioration this year, now seeing an unemployment rate of between 8.5 and 8.8 percent by year-end, rather than the projections three months ago of 7.1 to 7.6 percent. The Fed also now sees a contraction of the overall U.S. ec...

By Roy Harris • Feb. 18, 2009

It’s Easy Not Being Green

The majority of companies that are about to get hit with environmental sanctions ignore the Securities and Exchange Commission’s requirement that they disclose that liability to investors, according to a University of Arkansas researcher.In one of the SEC’s rare bright-line materiality guidelines...

By Sarah Johnson • Feb. 18, 2009

SEC Gets Ounce of Flesh from RIM Execs

The Securities and Exchange Commission today charged BlackBerry maker Research in Motion and four senior executives, including two finance officers, with stock-option backdating. At the same time, the SEC announced that the charges have been settled.The accused individuals include Dennis Kavelman...

By David McCann • Feb. 17, 2009

SEC Should Adopt CIA Methods, Lawyers Say

The recent fiery criticism leveled by U.S. Representatives and Senators at the Securities and Exchange Commission for allegedly dropping the ball on investigating Bernard Madoff and mishandling the financial crisis has prompted lawyers to dream big dreams about boosting SEC prosecutions of corpor...

By David Katz • Feb. 13, 2009

Dividends Are Deemed Expendable

A growing number of companies are slashing their dividends to preserve cash. Many have had a long tradition of providing the payouts, which had enabled them to attract conservative, loyal buy-and-hold investors.For example, The Dow Chemical Co., which has paid shareholders cash dividends every qu...

By Stephen Taub • Feb. 13, 2009

The Cost of Auditor Independence

Hiring a public accounting firm to provide both internal and external audits, a practice that was banned by the Sarbanes-Oxley Act, actually reduced companies’ accounting risk, researchers claim.The knowledge of a company that an external auditor gained from internal auditing lowered the chances ...

By Sarah Johnson • Feb. 12, 2009

FBI: 530 Corporate Fraud Probes in Progress

The long prison terms handed out to high-profile fraud perpetrators at Enron, WorldCom, Tyco, and others this decade apparently haven’t had much of a deterrent effect.The FBI has more than 530 open corporate fraud investigations, including 38 directly related to the current crisis, deputy directo...

By Stephen Taub • Feb. 11, 2009

A COO for the SEC?

The United States Chamber of Commerce, never an enthusiastic supporter of government regulation of business, today advised that the Securities and Exchange Commission should make vast changes in its management structure.Seven of 23 recommendations in the chamber’s report on the commission’s effic...

By Kate Plourd • Feb. 11, 2009

SEC’s Casey Rips Rating Agency “Oligopoly”

The Securities and Exchange Commission should strip language from its rules that have set up and preserved “a valuable franchise for the large rating agencies, while simultaneously inoculating them from market competition,” SEC Commissioner Kathleen Casey has asserted. Declaring it to be an essen...

By David Katz • Feb. 10, 2009

Top Enforcer Leaves SEC

 Linda Chatman Thomsen is leaving the Securities and Exchange Commission after nearly four years as the regulator’s enforcement chief.She will return to the private sector, the SEC said today. The SEC’s announcement has been largely expected since Mary Schapiro took over as the commission’s chair...

By Sarah Johnson • Feb. 9, 2009

SEC to Get Tougher on Corporate Wrongdoers

Securities and Exchange Commission chairman Mary Schapiro announced Friday she would make it easier for SEC staff to launch formal investigations of corporations, and she overturned her predecessor’s policy of requiring commission approval for levying financial penalties against public companies....

By Tim Reason • Feb. 6, 2009

RIM Execs to Pay for Mispriced Options

Research In Motion Ltd. and eight executives have settled charges from Canadian regulators over the company’s historical stock-option-granting practices.Four of the eight executives — including two finance executives — agreed to pay a total of $75 million (U.S.). The settlements still must be app...

By Stephen Taub • Feb. 6, 2009

Six Degrees of Bernie Madoff

The customer list for Bernard L. Madoff Investment Securities was released on Wednesday as part of a New York bankruptcy court filing. The list that runs 162 pages is filled with the names and addresses of individuals, companies, trusts, pension plans and other entities that invested in the firm ...

By CFO Editorial Staff • Feb. 5, 2009

Green light for France’s green aid

The European Commission has, for the first time, given the green light to a state-aid scheme specifically designed to help producers of relatively green products.The scheme, which is one of the measures adopted by France to tackle the current economic crisis, will allow both national and local au...

By European Voice Staff • Feb. 4, 2009

Lights Out for Ex-CFO in Revenue Scheme

A federal court has entered a final judgment against a former finance executive whom the Securities and Exchange Commission had charged in a fraudulent scheme to inflate revenue.Kevin Morano, the one-time CFO of Lumenis Ltd., an Israeli company that had executive offices in New York and whose sto...

By Stephen Taub • Feb. 2, 2009

Run for Cover

Out of sight, out of mind. CFOs rarely give much thought to credit insurance, delegating responsibility for it deep within the finance function. But as insurers withdraw cover in the face of surging claims (see “Bold Claims” at the end of this article), trade credit is now high on the agenda of m...

By Jason Karaian • Feb. 2, 2009

Warning Signs

Bart Le Blanc is certainly reassured by the fact that risk management has “always been an integral part” of the company where he works. Urenco, a privately held joint venture with German, Dutch and British owners, is one of a handful of uranium-enrichment companies that supply fuel for nuclear re...

By Janet Kersnar • Feb. 2, 2009

Getting Smaller, but Not Quieter

The world of high finance had already been brought low before the Madoff scandal rocked Wall Street in December. Even so, corporate finance officers shouldn’t write off the hedge-fund industry, which still serves as a hotbed of activist investors. “The activists aren’t going anywhere,” warns Jeff...

By Josh Hyatt • Feb. 1, 2009

The SEC under Schapiro

Can Mary Schapiro change the Securities and Exchange Commission from hapless bystander to tough cop?A seasoned career regulator, the 53-year-old Schapiro was tapped by President Barack Obama to succeed Christopher Cox as chairman of the SEC, and people are hoping she can restore investor confiden...

By Edward Teach • Feb. 1, 2009

Delisting Dilemmas

From retailers and rent-a-car companies to banks and radio networks, the number of companies facing stock-exchange delisting is mounting by the day. Nasdaq booted a total of 85 companies for failing to meet listing requirements (or going bankrupt) in 2008, while the New York Stock Exchange (NYSE)...

By Kate Plourd • Feb. 1, 2009

The Next Wave

The wounds of recession often encounter a particularly painful form of salt: litigation. Corporate attorneys stand ready to pour it on if they sense weakness in a rival, or as a way to compensate for their own economic woes. At the same time, regulators have gotten more aggressive, and the costs ...

By S.L. Mintz • Feb. 1, 2009

Ex-CFO Confesses to Tax Evasion

The former CFO of GlobeTel Communications has pled to tax-evasion charges, federal regulators have announced.Thomas Jimenez was charged earlier this month on a single count of obstructing and impeding the due administration of the tax laws. According to regulators, he was responsible for preparin...

By Stephen Taub • Jan. 30, 2009

Judge: OK to Sue Deloitte over Parmalat

In a ruling that could have sweeping implications, a federal judge says plaintiffs can sue Deloitte & Touche, its former CEO, and its affiliates for the role of the firm’s Italian affiliate in the collapse of Italian dairy giant Parmalat Finanziaria in 2003.Deloitte Touche Tomatsu “exercised ...

By Stephen Taub • Jan. 30, 2009