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Rep Oxley Cites Fannie Case In Defending Sarbanes-Oxley

Rep Oxley Cites Fannie Case In Defending Sarbanes-Oxley

by Rick Turoczy on July 28, 2006

U.S. House Financial Services Committee Chairman Michael Oxley, R-Ohio, cited the Fannie Mae (FNM) accounting scandal as “a recent case that clearly demonstrates the continued need for Sarbanes-Oxley compliance.”

In a statement Friday marking the fourth anniversary of the Sarbanes-Oxley Act of 2002, Oxley said Fannie Mae “is still in the midst of recovering from an $11 billion accounting scandal,” and added that “it was not until Fannie had to comply with Sarbanes-Oxley requirements that executives at the company finally admitted that the company’s internal controls over financial reporting were ineffective.”

Noting that the costs associated with the Section 404 internal control provision are the focus of most criticism of Sarbanes-Oxley, the congressman asserted that “these costs were severely overestimated, especially for smaller public companies.”

He said he continues to believe that “these costs are due, not to the text of the Sarbanes-Oxley Act, but to an overly zealous implementation of these internal control provisions.”

Rep Oxley Cites Fannie Case In Defending Sarbanes-Oxley

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