How Harsh Should the Legislation Be to Prevent Financial Crimes?
Document Type
Book Chapter
Source of Publication
Advances in Finance, Accounting, and Economics
Publication Date
1-1-2023
Abstract
The collapse of Enron and its auditor Arthur Andersen was one of the biggest events in US corporate history and it had long-lasting repercussions in the corporate world. Following the Enron – Arthur Andersen scandal, the US Congress passed the Sarbanes Oxley Act (SOX). The legislation was designed to strengthen existing securities regulations and enacted harsh penalties on lawbreakers. SOX was one of the first and heavy responses to corporate fraud. Since the passage of SOX, debates revolving around the costs and benefits of it have prevailed and several studies investigated its effectiveness to prevent future financial crimes. This study first reviews the chronology of the events leading to SOX, followed by a brief discussion of the rules and regulations established by SOX. The empirical evidence presented by previous studies on the effectiveness of legislation and the harsh penalty Enron's auditor had received are assessed and evaluated.
DOI Link
ISBN
9781668485873, 9781668485897
ISSN
Publisher
IGI Global
First Page
37
Last Page
50
Disciplines
Business
Recommended Citation
Iren, Perihan and Kim, Moo Sung, "How Harsh Should the Legislation Be to Prevent Financial Crimes?" (2023). All Works. 6022.
https://zuscholars.zu.ac.ae/works/6022
Indexed in Scopus
no
Open Access
no