Examination of the White Collar Crime Penalty Enhancements in the Sarbanes-Oxley Act
![handle is hein.journals/amcrimlr39 and id is 1545 raw text is: NOTE
EXAMINATION OF THE WHITE COLLAR CRIME PENALTY
ENHANCEMENTS IN THE SARBANES-OXLEY ACT
Jennifer S. Recine*
The Sarbanes-Oxley Act (the Act) was signed into law on July 29, 2002.1 The
Act's passage was widely heralded as an historic occasion marked by the most
comprehensive corporate reform measures enacted since the stock market crash of
1929.2 Passage of the Sarbanes-Oxley Act was a reaction to the questionable
business practices of corporate executives, which ultimately caused precipitous
across-the-board declines in the value of stock in publicly-traded companies
during the summer of 2002.3 The inclusion of the White Collar Crime Penalty
Enhancement Act (WCCPA) of 2002 in the corporate reform package was part of
the political branches' response to growing public outrage over a number of
highly-publicized incidents of corporate malfeasance.4 The specific enhancements
contained within the WCCPA increase the maximum jail sentences for individuals
convicted of certain ERISA violations, fraud, and conspiracies to commit fraud by
a factor of four to ten.5 The WCCPA also makes it a crime for corporate officers to
falsely certify the reports submitted to the Securities and Exchange Commission
(SEC).6 Furthermore, the WCCPA directs the United States Sentencing Commis-
sion (U.S.S.C.) to amend the United States Sentencing Guidelines (the Guide-
* J.D. expected, Georgetown University Law Center, 2003. 1 would like to thank Peter Moores, Don Anthony,
and Rachel Lebejko Priester for their help developing and fine-tuning this Note. Thanks also to my brother
Bradley Recine whose clear and concise answers to my questions about corporate finance were invaluable to my
understanding of these high-profile bankruptcies. Special thanks to Jessica Cordova, John Hirsch, and my family
for their support and encouragement throughout this process; I would not have written this Note without their
help.
1. Sarbanes-Oxley Act of 2002, Pub. L. No. 107-204, 116 Star. 804 (2002) [hereinafter Sarbanes-Oxley Act
or the Act]; see also Elisabeth Bumiller, Bush Signs Bill Aimed at Fraud in Corporations, N.Y. TMES, July 30,
2002, at Al.
2. David Stout, Bush Signs Broad Changes In Business Law, N.Y. TIMES, July 30, 2002, at http://www.
nytimes.comI2002/07/3Obusiness3OCND-BUSH.html.
3. Telephone Interview with Bradley Edgell, Senior Policy Analyst for the House Financial Services
Committee (Sept. 9, 2002) (transcript on file with author) (noting that languishing reform efforts on Capitol Hill
were reinvigorated by collapse of WorldCom and falling stockmarket); Jonathan Fuerbringer, Stockgauges Fall
2% or More on Job Reports, N.Y. TIMES, Aug. 3, 2002, at Cl.
4. Rachel McTague et al., Despite Partisan Mood, Senate Votes 97-0 To Add Penalty Measures to Accounting
Bill, WASH. INSIDER, July 11, 2002.
5. Sarbanes-Oxley Act, supra note 1, §§ 902-904.
6. Id. § 906.
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Examination of the White Collar Crime Penalty Enhancements in the Sarbanes-Oxley Act
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