After Skilling’s resignation, Andrew Fastow knew the end was near and had to realize that the United States Supreme Court would not tread lightly on this matter after he had ripped off so many people and ruined the remainder of their lives. Fastow ended up pleading guilty to fraud, insider trading, and almost 100 counts of money laundering. After taking one look into the accounting sheets of Enron, the courts needed not to be convinced that Fastow was guilty. As for Skilling’s charges, he ended up being convicted of over half of the counts of securities fraud (19 of the 28) and was given a little over 24 years in prison. Skilling was upset with the verdict and appealed the case and got his sentence reduced by 10 years, a pretty good deal for
…show more content…
Therefore in 2002, the Sarbanes Oxley Act of 2002 (which is known as SOX for short), was enacted to prevent companies from praying on the uninformed through insider trading and fraud. The SOX intention was that no more huge losses which impact the financial markets and general investor trust10. Moreover, effective in 2006, the SOX mandated a general accounting framework for all public companies that do business in the United States. The SOX created the Public Company Accounting Oversight Board (PCAOB) whose job it is to oversee all audits for public companies in the United States. Furthermore, the SOX increases corporate governance by enacting specific rules that corporations must follow closely such as having upper-level management sign off on the accuracy of all financial information that pertains to the company11 . With the creation of the SOX, some say the most pivotal section of the act is where upper-level management has to file insider trades in a timely and effective manner. The Sarbanes Oxley Act of 2002 does far more than the creators of it intended. It obviously prevents fraud and insider trading that individuals used to get away with; however, it also creates an environment for future companies to play fair and stray away from illegal activity because it’ll inevitably be found
Therefore in 2002, the Sarbanes Oxley Act of 2002 (which is known as SOX for short), was enacted to prevent companies from praying on the uninformed through insider trading and fraud. The SOX intention was that no more huge losses which impact the financial markets and general investor trust10. Moreover, effective in 2006, the SOX mandated a general accounting framework for all public companies that do business in the United States. The SOX created the Public Company Accounting Oversight Board (PCAOB) whose job it is to oversee all audits for public companies in the United States. Furthermore, the SOX increases corporate governance by enacting specific rules that corporations must follow closely such as having upper-level management sign off on the accuracy of all financial information that pertains to the company11 . With the creation of the SOX, some say the most pivotal section of the act is where upper-level management has to file insider trades in a timely and effective manner. The Sarbanes Oxley Act of 2002 does far more than the creators of it intended. It obviously prevents fraud and insider trading that individuals used to get away with; however, it also creates an environment for future companies to play fair and stray away from illegal activity because it’ll inevitably be found