SOX Center

Critics of the 2002 Sarbanes-Oxley act say the bill’s post-Enron/WorldCom accounting reforms have made U.S. capital markets less competitive with those overseas. It’s no surprise that one of its authors, former U.S. Rep. Michael Oxley, says that’s hardly the case. Oxley says recent refinements to the section of the act requiring companies to monitor internal financial controls and accounting are improvements, but he doesn’t believe SOX, as it’s commonly known, was crippling U.S. businesses.

Oxley was in Houston recently to talk to clients of law firm Baker Hostetler, where he now works in an Of Counsel role.

He talked to the Chronicle’s Tom Fowler about SOX’s legacy, the collapse of Arthur Andersen and why bankers may be more to blame for the high cost of going public.

chron.com: Oxley says reforms’ effects overblown

The timing of the scandal helped build support for tougher rules in the 2002 bill on securities laws.

His name is not on the law, but maybe it should be. Perhaps more than either Sen. Paul S. Sarbanes or Rep. Michael G. Oxley, Bernard J. Ebbers is responsible for the far-reaching change in U.S. securities laws since the Depression.

That law has changed the face of international securities markets and greatly increased the regulation of auditors around the world.

Ebbers, 63, was sentenced Wednesday to 25 years in prison for his role in the fraud that led to the bankruptcy filing of WorldCom. Ebbers founded LDDS Communications, a small long-distance company, and through acquisitions built it into a giant.

But WorldCom collapsed in fraud in early 2002, just as Congress seemed unable to agree on securities legislation that had been spurred by the Enron fraud a few months earlier. The WorldCom collapse ensured passage of a bill that was far tougher than had seemed possible only weeks before.

OC Register: WorldCom’s collapse gave boost to Sarbanes-Oxley