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US laxity = global suffering

US laxity = global suffering
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First Published: Fri, Dec 26 2008. 12 01 AM IST
Updated: Fri, Dec 26 2008. 12 01 AM IST
In the waning days of 2008, a remarkable year when toxic exports from the US’ economic woes, inscrutable financial products, outright frauds and many shenanigans brought global markets and economies to their knees, here is one explanation of why it all came home to roost. The New York Times, citing Syracuse University research, points out that US federal officials are on track to bring the fewest prosecutions for securities fraud since at least 1991. There were just 133 prosecutions in 11 months, down from 437 in 2000 and 513 in 2002, the year of Enron. At the US Securities Exchange Commission, or SEC, whose work leads to justice prosecutions, such investigations dropped to nine in 2007 from 69 in 2000, an 87% drop (see story on Page 4).
While SEC, without giving supporting data, is contesting that it was lax, US’ woes, now exported around the world, including India, are clearly a result of loose enforcement and a culture that abetted and encouraged a real lack of transparency. Here’s hoping 2009 and the new SEC head, already picked by Obama, will think and act differently.
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First Published: Fri, Dec 26 2008. 12 01 AM IST