You already know about “Bots Gone Bad”— the episode where a Google “bot” crawling the Internet found a 2002 story about United Airlines declaring bankruptcy, somehow erroneously concluded it was a current story, and added it to Google News. The 2002 story was ultimately sent out with a fresh date by Bloomberg on September 8, […]
Bruce Carton
Posted inFrom the Archive
Must-Read: “S.E.C. No Evil”
If you are interested enough in the subject that you visit a blog called “Enforcement Action” (and we’re happy that you are!) then you must read “S.E.C. No Evil,” an article by Scott Paltrow in the October 2008 issue of Conde Nast’s Portfolio. The article is an in-depth look at SEC Chairman Christopher Cox’s impact […]
Posted inRegulatory Enforcement
Getting the “Last Laugh” on the SEC, the Hard Way
On Tuesday, the SEC brought an enforcement action against James D. Zeglis and Gautum Gupta, Lance D. McKee and Jim W. Dixon alleging insider trading in the securities of Georgia-Pacific Corporation. The SEC alleged that Zeglis obtained material nonpublic information from his brother, a member of Georgia-Pacific’s board of directors, and tipped Gupta and Dixon […]
Posted inAccounting & Auditing
What Happens to D&O Coverage if AIG Goes Under?
I have a question for the 26,000 of you that I have been wrestling with. Obviously the news about AIG the past few days has been pretty bleak. If a huge provider of D&O coverage like AIG was to declare bankruptcy, what would happen to the coverage of the countless directors and officers insured by […]
Posted inFrom the Archive
Why Does Fraud Occur? (Movie Edition)
On Tuesday of last week, Lori Richards, Director of the SEC’s Office of Compliance Inspections and Examinations, spoke at the Southwest Securities Enforcement Conference. Her remarks were on the subject of “Why Does Fraud Occur and What Can Deter or Prevent It?.” Richards stated that she had seen distinct types of fraud in her tenure […]
Posted inFrom the Archive
Bots Gone Bad
Yesterday, at approximately 9:53 am, a headline appeared on Bloomberg screens worldwide stating “UAL Corp.: United Airlines files for Ch. 11 to cut costs.” In a blink, the airline’s stock fell from around $12 to $3 a share, and Nasdaq quickly halted trading. About an hour later, UAL issued a statement confirming the report was […]
Posted inEthics & Culture
SEC Pays Up! Fair Funds Doled Out to Investors
A little known office established just six months ago within the Securities and Exchange Commission seems to have hit its stride this summer, producing tangible results for investors and possibly signaling the end of six years of frustration for the SEC. Since 2002, the SEC has struggled mightily (and publicly) to develop some efficient way […]
Posted inFrom the Archive
The Rule 10b5-1 Buying Plan Challenge
In August 2008, West Marine (WMAR) founder and chairman, Randy Repass, did what thousands — probably hundreds of thousands — of corporate executives have done before him: he set up a Rule 10b5-1 trading plan to cover future transactions in his company’s stock. According to an article in the Mercury News, Repass set up what […]
Posted inFrom the Archive
Walters Sworn in as SEC Commissioner
On July 9, Elise Walters, one of three new SEC commissioners recently appointed by President Bush and confirmed by the Senate, was sworn in by Chairman Christopher Cox at a ceremony held at the SEC. After being sworn in, Ms. Walters promised to “do my utmost to live up to the awesome responsibility entrusted to […]
Posted inEthics & Culture
Trials Show Job Requirement No. 1 For CFOs Is Courage
In federal courtrooms about 1,000 miles away from each other, two high-profile criminal trials of corporate CEOs are proceeding with so many similarities that it sometimes can be hard to keep them straight. In New York, a jury will likely reach a verdict this week on whether former WorldCom CEO Bernie Ebbers will go to […]