Corporate Fraud

975 WordsNov 15, 20064 Pages
"Corporate Fraud"…when you hear those words the first, most recent incident, many think of is The Enron Scandal. This same scandal produced the Public Company Accounting Reform and Investor Protection Act of 2002. This much needed act created the Public Company Accounting Oversight Board under the Security Exchange Commission 's supervision. This board sets accounting standards and investigates Certified Public Accountants and companies to ensure they are following the guidelines set forth. This board has also been given the authorization to fine, suspend and recommend criminal investigations in the event CPA 's and their firms violate the standards. (Lindstrom) To understand the stringency of this Act is to recognize what brought it…show more content…
(Lindstrom) Hopefully the congressional meetings and hearings will cause other potential "Enron/Arthur Anderson-followers" to choose the legal path of doing business. Observers believe that it was not so much that the executives opted to mishandle their company, but that the scandal went without notice for so long by those people and groups which are set in place to detect and prevent dealings such as this. Auditors, internal/external controls, government regulators, accountants, etc., all failed to recognize the deception. Because the government was somewhat at fault for this, it is hard to make a decision as a whole, if the government should be the one to regulate or oversee corporate finances. Obviously, by what was seen with Enron alone, no matter how many committees, boards, groups, or agencies are involved, there is always a way to get around the legal system. The government needs to revert back to regulating certain entities (such as utilities, petroleum, etc.) before tackling the entire corporate financial world. This would cut in half the amount of companies they would have to deal. Monopolization of industries gives the companies too much power. They can charge whatever price they want and the consumer has no right but to pay it. It is comforting to be able to choose which telephone company you want to use and also what car you want to purchase. Why shouldn 't you be able to choose what gas company or electric

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