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Tuesday, June 21, 2005
SEC's Atkins: Back Off Company Fines
While senators gear up for the confirmation hearings of Rep. Christopher Cox (R-Calif.) — President Bush's nominee for chairman of the Securities and Exchange Commission — sitting commissioners are publicly staking out their agenda.
At a luncheon organized by the Association of Public Corporations held last Friday in Fort Lauderdale, Florida, commissioner Paul Atkins said the SEC should go after individual wrongdoers rather than levying heavy fines against the companies for which they work, according to The Sun-Sentinel. "Individuals commit fraud, corporations do not," he added.
Atkins reportedly said that even though the commission has been able to extract increasingly larger fines in recent years, he worries that the individual transgressors may try to settle with regulators using what he called "a pot of shareholders money." He also told the audience that individuals who fear being held personally responsible for wrongdoing are more likely to perform better.
Atkins conceded that for companies that have a long record of improper behavior, regulators would be wise to levy large corporate fines as well as individual charges. For example, he explained, fines should be levied on companies that have a history of dumping waste into waterways to save money, because shareholders of such companies profit from the offensive practices.
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