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The Sarbanes-Oxley Act, passed by the US Federal Government in response to the Enron scandal in 2002 has caused BioProgress to delist from NASDAQ for the second time, adding to the register of European firms fleeing the US market.

Cambridge-based specialty pharma and healthcare company, BioProgress has announced its intention to delist from the NASDAQ stock market on June 18, as a result of the limited benefits of trading on the American market becoming outweighed by the cost of adhering to the stringent laws instituted because of large scale corporate accounting scandals.

BusinessWeekly.co.uk: Another EoE firm abandons ‘burdensome’ NASDAQ

The arrest of a prominent attorney on charges of destroying evidence in a Connecticut child pornography investigation is raising alarm bells that a law targeting corporate accounting schemes could be used to prosecute lawyers over work done on their clients’ behalf.

“Every criminal defense lawyer in the country has to be alarmed at the indictment,'’ said New York University law professor Stephen Gillers. “It’s going to upset a lot of assumptions about how lawyers can represent clients. I think this is a boundary-pushing case.'’

Philip Russell was charged Feb. 16 with destroying a computer that contained child pornography at Christ Church in Greenwich, Conn. Former President George H.W. Bush attended the church while growing up and funeral services for his parents were held there.

Russell, the former attorney for the church, is accused of obstructing an FBI investigation that led to the January conviction of the church’s music director, Robert Tate, for possessing child pornography.

Russell was charged under the Sarbanes-Oxley Act, which Congress passed in 2002 after a wave of corporate accounting scandals to make it easier to prosecute such cases. He faces up to 40 years in prison if convicted.

Insurance Journal: Sarbanes-Oxley Charges in Conn. Case Worry Corporate Defense Lawyers

Auditors are doing a far better job of detecting corporate fraud since the 2002 Sarbanes-Oxley Act, while whistle-blowing by employees has declined, a new academic study concludes.

The U.S. law, adopted amid corporate accounting scandals at firms such as Enron Corp., spurred a four-fold increase in auditors uncovering fraud, according to the report. The study of 230 big corporate frauds between 1996 and 2004 found auditors detected nearly 17% of cases after Enron, up from 9.6% in the pre-Enron period.

Among other things, the 2002 law requires an annual assessment of corporate internal financial-reporting controls, and researchers say the yearly effort may help auditors detect fraudulent activity at client firms.

Morningstar: Study: Auditors Now More Likely To Spot Corporate Fraud