August 12, 2009
Reviving the Debate on SEC Corporate Penalties
It seems like just yesterday that we were debating whether corporate penalties were too high and were unfair to the corporation's "innocent shareholders"; former SEC Commissioner Paul Atkins was the leading proponent of that view, shared by some academics. Now a New York Times blog questions whether recent penalties are too low. It makes a good argument -- $50 million paid by GE, $15 million by Hank Greenberg, and $33 million paid by Bank of America, each of them for allegations of pretty egregious fraud. NYTimes, S.E.C. Watchdog’s Bite Not Matching Its Bark? The overarching issue here is that the SEC still has not articulated, much less enforced, a consistent policy on corporate penalties, so we really have no standards for determining what is fair and appropriate. It's another task for the energized SEC.
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