Washington, July 25: US house and senate negotiators have agreed on a wide-ranging Corporate Reform Bill that provides oversight of auditors and stiffens penalties for CEOs guilty of wrongdoing, in the hopes that shaken investors will edge back into the markets. Corporate reform took on new urgency in the wake of a raft of accounting scandals that began in December with the bankruptcy of energy trader Enron and continued yesterday with the arrests on fraud charges of five executives of the cable operator Adelphia and the announcement of an sec probe of media giant AOL time Warner. Investor confidence is almost an oxymoron these days," said house republican Mike Oxley, who chaired the conference that produced the bill aimed as a response to the scandals that were among the causes of the roughly seven trillion-dollar loss in the markets since march 2000.
But the passage of this legislation, coupled with yesterday's massive 480-point rebound by the blue chip Dow Jones index, seem to signal a "beginning of the restoration of confidence in the markets," Oxley said. The final bill, a stepped-up version of legislation proposed in the senate by Maryland democrat Paul Sarbanes, establishes an independent board to set standards and discipline auditor of public companies, to be overseen by the securities and exchange commission.
Bureau Report