Wasn't Sarbanes-Oxley Supposed To Stop Your Execs From Setting Up Fake Companies For Financing Vacation Homes?
from the just-wondering... dept
Whenever people point out the problems with Sarbanes-Oxley regulations, someone usually chimes in to say they’re necessary to stop “Enron-type” situations. The thing is, people looking to create scams in companies will always figure out ways to do so. GE, who already is going through a bit of a mess as the SEC is questioning some of their accounting methods may be facing another problem, as it turns out that the former treasurer of GE-owned NBC Universal had apparently set up a fake company named NBCU Media Productions, which he then used to funnel nearly a million dollars into his own personal bank account and used for luxury items, such as “private jet flights, liquor and a vacation home.” This story actually sounds quite similar to the one of Robert Gordon, former Cisco business development VP who, in 2001 (pre-Sarbanes-Oxley) was accused of setting up shell companies and sending himself money. His defense, at the time, was that he was “thinking out of the box.” Indeed.