When it comes to protecting investors, the Sarbanes-Oxley Act of 2002 has been successful, Securities and Exchange Commission Chairman Christopher Cox said after the fifth anniversary of the law’s passage.
The sweeping corporate governance legislation was enacted on July 30, 2002, in response to the accounting fraud scandals at Enron, WorldCom, and other companies that cost investors billions of dollars.
According to Cox, who came to the SEC two years after the law was signed, the primary aim of the legislation--better investor protection from fraud--has been attained. Since companies have begun complying with the major provisions of the law, the number of fraud-related securities class-action suits has gone way down, Cox told Renée Montagne, host of National Public Radio’s "Morning Edition" program on Aug. 7.
Also, an unexpected but beneficial side effect of the law has been an increase in company self-reporting, Cox said.
See full Article.
Posts
