    [Public Papers of the Presidents of the United States: George W. Bush (2002, Book II)]
    [September 26, 2002]
    [Pages 1665-1667]
    [From the U.S. Government Publishing Office www.gpo.gov]

    Remarks at the Corporate Fraud Conference
    September 26, 2002

        Thanks for the warm welcome. Thank you for being here. This is an
    important meeting you're having. After all, over the past year, high-
    profile acts of deception in corporate America have shaken people's
    trust in corporations, the markets, and in the economy.
        A few dishonest individuals have hurt the reputations of many good
    and honest companies and their executives. They've hurt workers who
    committed their lives to building a company that hired them. They've
    hurt investors and retirees who placed their faith in the promise of
    growth and integrity. For the sake of our free market, corporate
    criminals must pay a price.
        Today I want to thank all of you, U.S. attorneys, senior
    prosecutors, FBI special agents, senior Treasury and IRS officials, and
    many others. I want to thank you for your efforts. And I want to thank
    you for the progress which is being made. Your

    [[Page 1666]]

    mandate is to root out crime from corporate America's boardrooms and
    executive suites. Your mission is to protect the rights and interests of
    American workers and investors. And your work is essential to our
    Nation.
        I particularly want to thank Attorney General John
    Ashcroft, who is doing an excellent job as our
    Attorney General. I also want to thank Elaine Chao, the Secretary of Labor, for her hard work.
        I appreciate Harvey Pitt, who's the Chairman
    of the Securities and Exchange Commission. He's doing a fine job, as is
    Michael Powell, the Chairman of the FCC, Jim
    Newsome, the Chairman of the Commodities
    Futures Trading Company--Commission.
        Larry Thompson is in charge of the
    President's task force to root out corporate fraud as the Deputy
    Attorney General. Michael Chertoff, the
    Assistant Attorney General of the Criminal Division of the Department of
    Justice, Jim Comey, U.S. Attorney, Southern
    District of New York, and Debra Yang, U.S.
    Attorney, Central District of California--I want to thank them for being
    up here on the stage with me. I want to thank them for their fabulous
    leadership and doing what's right for America.
        Since the exposure of recent corporate scandals, we have taken a
    series of strong measures. The American people need to know we're
    acting. We're moving, and we're moving fast. The Securities and Exchange
    Commission has hired 50 new personnel to support their efforts to ensure
    that business in America is open and honest--and to confront it when
    it's not.
        More help is on the way. I've signed the most far-reaching reform of
    American business practices since the time of Franklin D. Roosevelt.
    With this law, we're making sure that the numbers are honest and the
    numbers are understandable. We're making sure the auditors are audited
    and the accountants are held to account.
        And one of the most aggressive steps we've taken has been to create
    the new Corporate Fraud Task Force, headed by Larry, to investigate and prosecute financial crimes, to
    recover the proceeds of those crimes, and hold corporate criminals to
    account. This task force includes members of the Justice Department and
    the FBI, U.S. attorneys from around the country. It includes the SEC and
    the Treasury and Labor Departments, the Commodities Futures Trading
    Commission, the Federal Communications Commission, and the Federal
    Energy Regulatory Commission.
        This broad effort is sending a clear warning and a clear message to
    every dishonest corporate leader: You will be exposed, and you will be
    punished. No boardroom in America is above or beyond the law.
        I set this mandate, and today I want to give a report to the
    American people on the progress, the great progress which you all are
    making. Our law enforcement agencies are after them--they're after them.
    Since the task force was formed just 2\1/2\ months ago, the Department
    of Justice has opened more than 100 investigations into suspected
    corporate fraud. In 2\1/2\ months, 100 cases have been opened. Charges
    have been filed against more than 150 defendants. In 2\1/2\ months, 150
    people have been charged, and more than 45 defendants have been
    convicted or intend to plead guilty. In 2\1/2\ months, 45 people have
    been brought to justice.
        The Securities and Exchange Commission is also acting. In the past
    year, the SEC has filed a record 156 actions for financial fraud and
    disclosure violations, a 51-percent increase over fiscal year 2000.
    During the same period, the SEC has sought to throw 107 unfit officers
    and directors out of corporate boardrooms, almost 3 times the number
    that the SEC sought to bar in fiscal 2000.
        The SEC is aggressively using its enforcement powers to make
    corporate wrongdoers financially accountable for their actions. This
    fiscal year, the SEC has sought to recover compensation, bonuses, stock
    options from 25 corporate officers

    [[Page 1667]]

    who betrayed the public trust, an almost 40-percent increase over last
    year.
        By all these actions, we are making broad and dramatic progress
    against corporate fraud in America. We're defending our free enterprise
    system against corruption and crime. And we're beginning a new era of
    corporate integrity. Corporate responsibility is essential to America;
    it's essential to shareholders; it is essential to investors.
        It matters greatly to employees. In February, I proposed important
    pension reforms. We must give our workers better access to investment
    advice, so they can manage their money wisely. And right now, too many
    workers are locked into plans that force them to hold a large portion of
    their accounts in the company's stock. Workers ought to be able to
    diversify after 3 years in the company's plan.
        The House quickly passed these reforms. They moved swiftly. The
    Senate hasn't, and they need to act as well. It's good for American
    workers. It's good for job creation. It would be good for our economy.
        Underlying everything we have done so far and all the actions we
    will take in the future is a basic conviction: The American economy
    depends on fairness and honesty. It's not a jungle in which only the
    unscrupulous survive or a financial free-for-all guided only by greed.
    That's not the America we know.
        The fundamentals of a free market--buying and selling, saving and
    investing--require clear rules and confidence and fairness. The vast
    majority of American business men and women obey the law and uphold the
    rules. The vast majority of our fellow citizens care deeply about
    employees and shareholders. They bring great credit to the system. And
    those who break the rules and betray the confidence of their employees
    and shareholders will be punished. Government cannot and should not try
    to remove risk from investment. But we will help ensure that the risks
    are honest and the risks are clearly understood.
        We will hold corporate criminals accountable for their misdeeds, and
    we will deter corporate crimes by enforcing tough penalties. By doing
    this work so well, you are serving the American people. You are serving
    the American people with distinction. You are leaving a legacy of
    responsibility behind. You are making the country a better place. And
    for that I'm grateful, and so are the American people.
        May God bless you all. May God bless your families. And may God
    bless America.

    Note: The President spoke at 11:19 a.m. in the Jefferson and Lincoln
    Ballrooms at the Washington Hilton Hotel.