ABSTRACT
After the Enron scandal, Congress began looking for a way for regulators to gain control over public companies. The corporate reformers then took a grab bag of previously rejected corporate governance reforms and repackaged them for presentation to Congress. Sarbanes-Oxley had little effect on the integrity of the financial reporting system created by the SEC. Policing SEC accounting requirements remained problematic. The government was dealt another high-profile setback in a case brought against David Stockman, who had served as head of the Office of Management and Budget under President Ronald Reagan. Sarbanes-Oxley prohibits loans by public companies to management. The SEC was authorized to freeze “extraordinary” compensation payments at companies involved in accounting manipulations.
