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Mar 17, 2013

Is Sarbanes Oxley a Waste of Time?



Kevin D. Williamson wrote a really great article recently about the difference in Senator Elizabeth Warren’s treatment of rogue banks like HSBC and state and municipal fraudsters like the state of Illinois and the city of San Bernardino.
The article brought to mind a question that has bothered me for some time.  Why is Jon Corzine not indicted yet?  He was the CEO of MF Global when it went bankrupt.  Commodity broker MF Global used customer account money in its failing attempts to avoid bankruptcy.   Under Sarbanes Oxley as well as Securities laws, this is a crime.  In testimony before Congress, Cozine said he didn't know he was using customer money to meet MF Global's corporate margin calls.  I thought Sarbanes Oxley was specifically designed to make this defense impossible.  Note that Jon Corzine was a really big bundler of campaign contributions for Obama, as well as a former Democratic Senator and Governor of New Jersey.  Now that the campaign is over, can't we indict this guy?  Can't Warren demand some answers here?  If Sarbanes Oxley does not apply in this case, can we repeal it because compliance is both horribly expensive and, given MF Global shenanigans, a complete waste of time? 

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