| Tags |
Sarbanes Oxley
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| Year | 2009 |
| Publisher | 2009 |
| Volume | 1 |
| Description | In Fall 2001, the American people and the American business community were shaken to their core, not only by deplorable acts carried out by foreign terrorists, but also by deplorable acts carried out by what amounted to domestic terrorists with MBAs. Throughout the fall of 2001 and early 2002, the financial world was attempting to process the massive accounting frauds that transpired at Enron and WorldCom, eventually leading to the collapse of each company. 2 Congress responded swiftly, enacting the Public Company Accounting Reform and Investor Protection Act of 2002, more commonly known as the Sarbanes-Oxley Act of 2002 (SOX). 3 SOX, which has its fair share of critics, attempts to ensure that corporate disasters like the ones at Enron and WorldCom will never again have such a devastating effect on the American economy. Among SOX's many requirements and protections are protections for whistleblowers, the Sherron Watkins' and Cynthia Coopers' of the world,5 who are the first to take risks to alert others of a potential fraud. These whistleblowers normally would be able to utilize the court system to vindicate their rights in the event of a retaliatory employment action. Recently, however, employers have begun using mandatory arbitration agreements to keep potentially embarrassing whistleblower actions out of the court system. Guyden v. Aetna, Inc. is a recent Second Circuit case that examined the enforceability of such agreements, ultimately holding that whistleblower claims under SOX can be heard in confidential arbitration proceedings. (Description from Source) |