The energy conglomerate Enron was then the seventh-largest company in the U.S. Then, in December 2001, it collapsed-the largest bankruptcy in U.S. history.Įnron’s management had cooked the books, concealed problems in the business, defrauded investors, and more. Its failure wiped out more than $2 billion in pension plan assets and tens of thousands of jobs, including at Enron’s audit firm, Arthur Andersen. Six months later, the SEC filed allegations against WorldCom, once the largest handler of internet data, whose failure surpassed even Enron’s. These scandals were followed by other multi-billion dollar accounting frauds at Adelphia and Tyco. In response to this crisis, 20 years ago this week, President George W. It had passed almost unanimously in the House and 99 to 0 in the Senate.īush signed the Sarbanes-Oxley Act into law. Paul Sarbanes, my hometown senator from Maryland, was the new chair of the Senate Banking Committee. I was honored to have a front-row seat, working as his Senior Advisor on this legislation.Ī central goal of Sarbanes-Oxley was, once again, to restore trust in our financial system.
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