Right after the great Enron scandal, Congress passed the Sarbanes-Oxley Act, which imposed all kinds of new reporting requirements on corporations and put the CEOs on the hook personally for certain acts of malfeasance. I, and a lot of others, thought the whole thing was a bit of overkill; the reporting and record-keeping requirements seemed overly burdensome, and more in line with “quick, make people think we’re doing something” legislation than actual problem-solving.
I still think that way, but it occurs to me that we have right now a perfect opportunity to put the matter to the test. We have a (now former) CEO who apparently violated that law six way to Sunday, costing a lot of people a lot of money. And that person: Jon Corzine.
Over at Say Anything, Donny Baseball noted that in sworn testimony before Congress, the disgraced former MF Global CEO testified that he had no idea what his corporation did with investors’ money. Which is kind of odd, because in the Sarbanes-Oxley mandated filings, Corzine personally signed off that MF Global was in full compliance with the law and doing nothing wrong. As Donny put it, he either lied on the reports or he lied to Congress.
What makes it an even more delicious test case is that before Corzine headed up MF Global, he was the head of Goldman Sachs. And between those two jobs, he took a detour into public service — he was governor of New Jersey and a key economic advisor to the Obama campaign.
Oh, and he was also a member of the US Senate (D-New Jersey). And one of his brighter achievements was co-authoring the aforementioned Sarbanes-Oxley act he apparently broke.
So it looks like renowned and prominent Democrat Corzine broke the law he helped write. So let’s haul him into court and let him explain it.
And maybe I might have to revisit my opinion of Sarbanes-Oxley.