While the bill offers investors important protections \u2014 including imposing a fiduciary duty on brokers who give investment advice \u2014 an amendment was added to permanently exempt smaller public companies (worth less than $75 million)<\/strong> from a post-Enron auditing requirement. It passed with votes from 28 of the committee\u2019s 29 Republicans (one was absent) and 9 Democrats. All clearly were more interested in pleasing corporate constituents than protecting investors who, last time we checked, are also constituents. <\/font><\/p>\n The Sarbanes-Oxley Act, passed after the Enron debacle, requires public companies to have independent auditors attest to the effectiveness of their internal controls against financial fraud. During the Bush years, the regulation-averse S.E.C. routinely exempted small public companies from the audit requirement, saying it was unduly burdensome. But research shows that the law has succeeded in reducing errors and fraud \u2014 a big plus for investors. And changes made in 2007 have made the audits less onerous for business. <\/font><\/p>\n For those reasons, the S.E.C.\u2019s new chairwoman, Mary Schapiro, announced in September that the exemption would end in June. Unfortunately, the White House also appears to be more attuned to the concerns of corporate constituents than to the sensible S.E.C. chief, even though Mr. Obama chose her to run the agency. When the legislation comes up for a full vote in the House, members should strip it of this destructive amendment that only entrenches an antiregulatory policy of the Bush years<\/strong>\u2026 [emphasis added<\/em>]<\/font><\/p>\n<\/blockquote>\n Inserted from <NY Times<\/a>><\/p>\n I much prefer the no nonsense approach put forward by Bernie Sanders (Hat-tip Huffington Post<\/a>).<\/p>\n ![\"corruption\"](\"http:\/\/s217.photobucket.com\/albums\/cc83\/TomCat1948or2\/Blog%202009\/FlawedFinanceBillontheWay_1DA0\/corruption.jpg\" "\\"corruption\\"")
<\/a> Things turned Orwellian in the House Financial Services Committee this week when members \u2014 with the backing of the White House \u2014 passed an investor protection bill that would make it all too easy for thousands of publicly traded companies to cook their books<\/strong>.<\/font><\/p>\n