Andrew Fastow’s Sentencing Delayed

The sentencing of Andrew Fastow, the former Enron CFO, has been put off one month.Fastow was slated to learn how much time he would spend in prison on August 28. Now, he will wait until September 26, according to the Houston Chronicle.The paper noted that sentencing delays in complex criminal cas...

By Stephen Taub • July 20, 2006

A Sarbox Legacy: Alan Beller

Most CFOs won’t forget Alan Beller. He is credited with overseeing the implementation of more than 15 rule-making efforts related to the Sarbanes-Oxley Act, including those requiring certification of the accuracy of financial reports by chief executive officers and chief financial officers. As he...

By Stephen Taub • July 20, 2006

Partners in Liability?

Are a company’s business partners liable in shareholder lawsuits against the company? A recent appeals court ruling on that question may have muddied the water enough to force the Supreme Court to impose a little clarity in this already murky area.The case, Simpson v. AOL Time Warner, turns on wh...

By Rob Garver • July 19, 2006

Fed Governor: Sarbox Spurs Cash Jitters

A widespread aversion to risks spawned by corporate scandals and the Sarbanes-Oxley Act has helped push corporations to shore up whopping cash positions on their balance sheets, according to Federal Reserve Governor Kevin Warsh. In a speech Tuesday at the American EnterpriseInstitute, Warsh obse...

By Stephen Taub • July 18, 2006

Fastow to Testify Against NatWest Three

Examine our Enron archiveEnron’s former chief financial officer, Andrew Fastow, and one-time managing director, Michael Kopper, are expected to testify at the trial of the so-called NatWest Three, according to the British-based Guardian..The three former bankers, David Bermingham, Giles Darby, an...

By Stephen Taub • July 17, 2006

SEC Likes Its Own Plain English

Two years ago, the Securities and Exchange Commission began publicly releasing letters its staff writes to public companies when they have a comment — typically an objection of some kind — on the company’s public filing. A recent review of comments made about company 10Q filings suggests a consis...

By Tim Reason • July 14, 2006

How Regulation Drives up Insurance Costs

Assistant treasurers and corporate risk managers are linking up with the insurance industry to try to get Congress to strip the current insurance regulatory system of red tape. The effort, if it succeeds, could offer companies the chance to buy coverage from a federally regulated insurer rather ...

By David Katz • July 13, 2006

House Approves Rating Agency Shakeup

The U.S. House of Representatives approved a bill Wednesday — aimed squarely at Moody’s and Standard & Poor’s — that would alter the regulatory landscape for all credit-rating agencies.The “Credit Rating Agency Duopoly Relief Act of 2006” was approved by a 255-166 vote. If the bill also passe...

By Helen Shaw and Tim Reason • July 12, 2006

Insurers Seek Freedom from States

Property-casualty and life insurers should be able to take their pick between federal oversight and the current 50-state insurance regulatory system, top insurance executives told the Senate Banking Committee Tuesday.Speaking in support of the National Insurance Act of 2006, a bill sponsored by c...

By David Katz • July 11, 2006

Will COSO Small Biz Guidance Really Help?

Internal controls haven’t made executives at many small companies happy lately as they struggle to comply with Sarbanes-Oxley regulations.But you wouldn’t know that from Tuesday’s quirky introduction to new guidance intended to help those smaller companies assess their controls. “People in contro...

By Helen Shaw • July 11, 2006

SEC: More Questions than Answers on 404

Two months and one day after a contentious roundtable in which companies voiced their continuing displeasure with Section 404 of the Sarbanes Oxley Act, the Securities and Exchange Commission has responded, although primarily with more questions for public companies.The concept release, published...

By Marie Leone • July 11, 2006

“NatWest Three” Head to US for Trial

Examine our Enron archiveThree British bankers have exhausted their efforts to fight extradition to the United States, and will be flown to Texas on Thursday, July 13, to face fraud charges related to Enron, Bloomberg reports. David Bermingham, Gary Mulgrew, and Giles Darby, former executives at ...

By Tim Reason • July 10, 2006

Feds Back Sarbox Whistle-blower

Late Thursday, the Department of Labor filed a motion to intervene in what is reportedly the first Sarbanes-Oxley whistle-blower case to go to trial. The motion, along with a 13-page memorandum in support of former Cardinal Bankshares CFO David Welch’s application for reinstatement, was released ...

By Marie Leone • July 7, 2006

Did News Corp. Violate Reg FD?

Did News Corp. chief executive officer Rupert Murdoch violate Reg FD when he invited only a select group of investors to a meeting in Australia last week?According to a report by Reuters, most shareholders did not learn how much revenue News Corp.’s critical Internet business MySpace.com would ge...

By Stephen Taub • July 7, 2006

Glassman: SEC Needs Lesson in Economics

Cynthia Glassman, a Republican Securities and Exchange commissioner who was appointed in 2002 and will not seek a second term, called for economically sound regulation in a speech before the National Economists Club in Washington, D.C., on Thursday. Glassman, whose term expired in June, will cont...

By Helen Shaw • July 7, 2006

SEC Ends Material Sciences Probe

Material Sciences Corp. said the Securities and Exchange Commission has concluded its review of the company’s material weaknesses reported for fiscal 2005.The company did not say what the results of the review were. Investors, apparently inferring from the announcement that the SEC had found no w...

By Stephen Taub • July 7, 2006

Coke, Pepsi Bury Hatchet, Solve Crime

The Coke-Pepsi rivalry took a bizarre twist when several Coca-Cola employees who had reportedly tried to sell trade secrets were taken into custody by federal authorities Wednesday after Pepsi tipped Coke off to the scheme. Three suspects were charged with stealing confidential information—includ...

By Stephen Taub • July 6, 2006

Lay’s Death Clears His Record

The death of former Enron chairman Kenneth Lay will clear his record of his conviction, and even his indictment, ending Department of Justice efforts to recover Lay’s bonuses and other earnings. The legal doctrine, known as the abatement doctrine, will also likely complicate efforts by the Securi...

By Marie Leone and Tim Reason • July 5, 2006

Enron’s Lay Dies of Heart Attack

Examine our Enron archiveKenneth Lay has died of a heart attack.The 64-year-old former chairman of Enron, who was recently convicted of all six charges against him for his role in the one-time energy giant’s collapse, was scheduled to be sentenced later in the year.He had faced a prison term that...

By Stephen Taub • July 5, 2006

What Do You Know?

When one of Mobility Electronics Inc.’s major customers decided to switch to a competitor’s product five years ago, the potential defection galvanized top management. Not only would it mean up to $10 million in lost revenue annually, says executive vice president and CFO Joan Brubacher, but Mobil...

By Linda Corman • July 1, 2006

Hungry for More

Carol DiRaimo was fed up. Last February, the head of investor relations for Applebee’s International began an earnings call by urging analysts to stop hounding the restaurant chain’s franchisees for confidential information. Callers were frequently “rude and disruptive,” complained DiRaimo, even ...

By Kate O'Sullivan • July 1, 2006

Union Seeks to Further Humble Home Depot

Some shareholders are still upset about last month’s Home Depot annual meeting, at which chairman and chief executive officer Robert Nardelli was the only board member in attendance.Earlier this week the pension plan of the American Federation of State County and Municipal Employees sent a “deman...

By Stephen Taub • June 29, 2006

Did Politics Quash an SEC Probe?

Senior SEC officials stopped a hedge fund probe because one of the subjects of the investigation “had powerful political connections…at the highest level,” according to former Securities and Exchange Commission investigator Gary Aguirre.Testifying on Wednesday before the Senate Judiciary Committe...

By David Katz • June 29, 2006

Scrushy, Former Governor Convicted

Richard Scrushy may find himself behind bars after all.On its eleventh day of deliberations, a federal jury has convicted the founder and former chief executive officer of HealthSouth on a number of charges involving former Alabama governor Don Siegelman, according to the Birmingham Press-Registe...

By Stephen Taub • June 29, 2006

Security Company, Execs Settle with SEC

The Securities and Exchange Commission has settled civil charges with PowerLinx, a small maker of security products and underwater cameras formerly known as SeaView Video Technology, and two former executives.The SEC had charged that the company, former chief executive officer George Bernardich I...

By Stephen Taub • June 29, 2006