WASHINGTON, Jan. 11 (UPI) — Pres. George W. Bush on Saturday announced increased funding for federal initiatives to crack down on corporate fraud in an effort to restore investor confidence that was severely damaged last year in a string of scandals that rocked Washington and Wall Street.
“Our country has made great progress in restoring investor confidence, and putting the recession behind us,” said Bush. “We cannot be satisfied, however, until every corporate wrongdoer is held to account, and every part of our economy is strong, and every person who wants to work can find a job.”
Bush used his weekly radio address to the nation to detail his plan to seek what the White House called historic level of funding in his 2004 federal budget proposal for federal investigators, prosecutors and regulators to enforce corporate governance laws enacted last year.
The financial community and Washington were stunned last year by the demise of Enron, an energy trading company, and by alleged corporate fraud within the telecommunications company WorldCom and other large corporations. Those scandals led to the layoff of thousands of workers, many of whom lost nearly all the value in their pension plans, 401(k) plans and other company benefits while high-ranking company executives walked away with millions of dollars after cashing out their own stock options early.
Bush said he is asking Congress to approve $842 million for the Securities and Exchange Commission, the largest funding increase in the agency’s history. The request would allow the agency to hire new accountants, lawyers and examiners. It will also replace and upgrade computer systems.
The president’s budget proposal would also boost funding for the U.S. Department of Justice, adding $25 million to expand the agency’s investigation and prosecution abilities. The FBI would receive $16 million to hire 56 agents to investigate corporate fraud. It will also fund hire more attorneys.
Bush is seeking a 10 percent increase in funding for the U.S. Department of Labor’s efforts to recover approximately $500 million in pension plan assets. This funding would provide additional enforcement to safeguard workers’ retirement savings and other benefits in the wake of corporate fraud cases. Funding will also be used to expand compliance assistance efforts to educate employers and pension plan administrators on their responsibilities under the new pension laws.
The president in July signed into law accountability legislation giving federal officials new authority to investigate fraud and wrongdoing in the corporate community and provides for tough oversight of the industry.
Copyright 2003 by United Press International. All rights reserved.