|  | | 2006 News and Press Releases | | |
HEADLINE NEWS:
Critics: To Let Up On Wall St. Is A Mistake; Report Derided As Defense 'Wish List.'
Pamela A. MacLean
The National Law Journal. December 11, 2006
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EXCERPT: After months of work and media coverage, a high-profile report urging eased financial regulation to keep U.S. capital markets competitive has been derided as a corporate defense lawyers' 'Christmas wish list.' If adopted, critics say, the proposals to scrap some investor protections would create serious new litigation problems and hobble state enforcement authority. The privately funded Committee on Capital Markets Regulation argued in its report that America has lost its hegemony in world capital markets, and it blamed post-Enron scandal reforms as excessive and expensive regulation. It also called for curbs on shareholder class actions and limits on state power to prosecute corporate fraud. As a next step, the committee's director, Hal S. Scott, a Harvard Law School professor, said the group has asked President Bush to direct his administration to review and implement the proposed regulatory changes and refer legislative reforms to Congress. The Bush administration panel asked to review the report consists of representatives from the U.S. Department of Justice, the Securities and Exchange Commission, the Federal Reserve and the Commodities Futures Trading Commission. Scott was hopeful that the review could be under way by the end of January. Some of the boldest proposals in the Nov. 30 committee report brought angry cries from top state cops. 'This whole thing is a D.C.-based, defense lawyer Christmas wish list,' complained Thomas Greene, chief assistant to California Attorney General Bill Lockyer. New York Attorney General and Governor-elect Eliot Spitzer called the proposals 'absurd.' Connecticut Attorney General Richard Blumenthal also weighed in, stating that 'increasing competitiveness does not require handcuffing law enforcement against corporate crime and wrongdoing.' And plaintiffs' lawyers have not minced words. 'The last time Wall Street and corporate regulators got together to protect investors it was followed by one of the largest upsurges in corporate corruption in U.S. history,' said William Lerach of Lerach Coughlin Stoia Geller Rudman & Robbins in San Diego. |
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