July 21, 2002

Washington, D.C.- The accounting scandals of Enron and WorldCom have exposed the corruption of the companies' CEOs, have caused grief for shareholders and employees, and have shaken the confidence of investors in our business sector as a whole.

The stories of long-time employees losing their jobs and their retirement nest eggs, while corporate millionaires cash in their stock bonuses have left us all with feelings of sadness, frustration, and anger.

In response, the president proposed sweeping reforms in the area of corporate responsibility, and outlined proposals to expose corporate corruption and protect the investments of employees and shareholders. I wholeheartedly supported the president's proposals, and I have voted for legislation designed to put these reforms into law.

Last week, I voted for a bill modeled after President Bush's proposals. The bill, H.R. 5118, the "Corporate Fraud Accountability Act of 2002," provides new measures for increasing the punishment of corporate wrongdoers.

The bill will ban CEOs and other officers who clearly abuse their power from serving in any corporate leadership position. It will also strengthen laws that criminalize document shredding and other forms of obstruction of justice and will provide a maximum penalty of twenty years for such violation. The corporate executive in the corner office who defrauds employees and shareholders out of thousands of dollars is no different than the armed robber in the alleyway who holds up his victims with a gun.

The bill will also require top corporate executives to certify that the financial statements of the company fairly and accurately represent the financial condition of the company. Violating this section would subject corporate executives to fines of up to $5 million and twenty years in prison. Executives who cook the books in order to defraud both shareholders and employees should face serious jail time for their actions.

Also in the area of corporate reform, I voted for the Pension Security Act (H.R. 3762) to give workers new protections and freedoms to safeguard their retirement savings. And I voted for the Corporate and Auditing Accountability, Responsibility and Transparency Act (H.R. 3763) to enhance investor confidence, improve corporate responsibility, and reform accounting oversight. We will be working with the Senate this week to create a final bill that brings the best facets of this bill, a Senate version of the bill, and the reform bill we passed last week. It's important that the final bill we send to President Bush for his signature includes the tougher provisions of our House bill, such as up to twenty years of jail time for corporate crooks, as well as real-time corporate disclosure to protect investors.

As the president said in his speech, the foundation of our economy is built on the confidence in our markets. We must enact these reforms so that the American people can continue to have the confidence to invest their hard-earned dollars in our economy.