In Mel Brooks’ brilliant 1968 movie, “The Producers,” a timid accountant named Leo Bloom (played by Gene Wilder), off-handedly suggests that his client, Broadway producer Max Bialystock (played by Zero Mostel), could actually make more money by producing failures than hits. By overselling investment interests in truly bad plays, a short-running failure would leave the […]
Harvey L. Pitt
Posted inUncategorized
The FCPA—Best Practices For A New Climate
In the movie “Syriana,” a lawyer investigates irregular payments by a U.S. oil company to secure concessions in Kazakhstan. When the lawyer confronts Danny Dalton, one of the oil company’s directors, Dalton retorts: “Corruption? Corruption ain’t nothing more than government intrusion into market efficiencies in the form of regulation … We have laws against it […]
Posted inInternal Controls
SOX 404 Redux: It’s Groundhog Day
In the movie, “Groundhog Day,” Bill Murray plays Phil Connors, a self-absorbed, egotistical, and determinedly obnoxious Pittsburgh TV weatherman, who finds himself in Punxsutawney, Pa., to cover Groundhog Day. Phil doesn’t like this assignment, but his unwelcome endeavor turns into a spectacular nightmare, as he’s required to repeat Groundhog Day over and over again until […]
Posted inRegulatory Enforcement
What To Do When The SEC Comes Calling
Unfortunately (at least in the view of public companies), the Securities and Exchange Commission has been very successful in its mission to create the illusion of three dimensions, or seemingly being everywhere at once. Its enforcement prowess is undeniable, and its tenacity is not to be underestimated. This means that many companies will (not may), […]
Posted inEthics & Culture
Learning The Lessons Of Hewlett-Packard
Movie fans surely will recall Paul Newman’s stellar performance as Frank Galvin, a down-on-his-luck, often inebriated, ambulance-chasing, trial lawyer, in the 1982 film, “The Verdict.” What may not be recalled is that the movie provides an interesting backdrop for current considerations of the Hewlett-Packard Saga. To refresh our collective recollections, Galvin is given a chance […]
Posted inInternal Controls
Document Creation, Retention, And Destruction Policies
As a practicing lawyer, my clients were all well aware of the infamous “Pitt’s Postulate”: Whenever you think you’ve destroyed the last copy of any document, there’s always one more that exists, and it will surface at exactly the most inopportune time. The only exception, of course, is if you really need the document, at […]
Posted inFrom the Archive
Finding A Cure For The Compensation Blues
As executive officers return from their summer vacations, many may be suffering from the “Compensation Blues.” No, this isn’t a new “love-gone-bad” heartache captured by Billy Holiday in a ballad you somehow missed. This is a real-life corporate heartache, as painful as any about which Lady Day sang, arising from the ever-widening stock option backdating […]
Posted inFrom the Archive
Essentials For An Ethical Corporate Culture
At Compliance Week’s 2006 Annual Conference on Governance, Risk and Compliance, Compliance Week columnist and former Securities and Exchange Commission Chairman Harvey Pitt addressed some of the concerns inherent in building an ethical culture. This column contains the remarks he delivered at that time. We’ve come a long way in the past several years, to […]
Posted inInternal Controls
A Risk-Based Approach To Section 404
In the movie “City Slickers,” three depressed friends leave their troubled urban lives behind to spend two weeks moving a herd of cattle across the plains, and perhaps, in the process, rediscovering what can give their lives more meaning. The trail boss, Curly (Jack Palance), tells mid-life crisis plagued Mitch (Billy Crystal), that the secret […]
Posted inAccounting & Auditing
On The Road To Global Governance Standards
With Nasdaq announcing its acquisition of nearly 25 percent of the shares of the London Stock Exchange, and the concomitant pressure on the NYSE to make a comparable foreign exchange acquisition, it’s now readily apparent that we’re moving toward global, and away from national, capital markets. In more prosaic terms, what this means is that […]