In a presidential address to the nation in October 2002, George W. Bush called for jail sentences for business executives convicted of fraud to be extended to the maximum term of 10 years.
He also announced the creation of a Corporate Fraud Taskforce -- a "financial crime Swat team" -- which would operate under the umbrella of the Justice Department (the agency responsible for probing Enron, Andersen and WorldCom).
The Swat team's leader? Deputy Attorney General Larry Thompson. The problem? Thompson, who had served on the board of directors of Providian Financial Corporation, had recently been sued by Judicial Watch (a public interest group which investigates and prosecutes government corruption and abuse) for securities fraud involving misleading accounting practices and insider trading.
["The Providian scandal is especially egregious because it highlights this incestuous relationship in perhaps its clearest form," Judicial Watch Chairman Larry Klayman declared: "A director who allegedly participated in and profited personally from alleged securities fraud is appointed to a key government position where he is alleged... to have abused his official office to block appropriate government enforcement action." (Providian later paid $478,000,000 to settle three cases.)]
Sources
accountancyage.com, 10-07-2002; Harpers, Sept. 2002
