Watch out accountants: the SEC has you in its sights!
The Securities and Exchange Commission is planning to sue more accounting companies for the roles they played in carrying out fraud at big companies.
And that’s just the first wave of tougher enforcement.
The SEC is getting a new chairman, William Donaldson, who demanded a far bigger budget to put more teeth behind the SEC’s regulations.
Bush has called for Congress to double the SEC budget from $438 million in 2002 to $876 million in 2003.
“It is time to adopt a new enforcement model, a new paradigm: one that holds an accounting firm responsible for the actions of its partners,” said Stephen Cutler, chief enforcement director of the SEC, in a speech to the American Institute of Certified Public Accountants.
In the past, the SEC went soft on accounting firms. If it took action at all, it was usually against individual accountants, not their firms.