Hoping to restore investor confidence after a wave of boardroom scandals, US President George W Bush vowed "hard time" instead of "easy money" for corporate crooks today as he signed a law that quadruples penalties for accounting fraud.
The bill, largely written by Maryland Democratic Sen. Paul Sarbanes and designed to make it harder for company executives to deceive investors, was spurred by weak stock markets, voter anger and approaching congressional elections.
The legislation was far tougher than measures proposed by Bush, who has been questioned about his own stock sales and a low-interest loan he accepted while he was an outside director at Harken Energy more than a decade ago.
Challenged by the perception that his administration is too close to big business, Bush was under pressure to sign the tougher law quickly amid public outrage at recent staggering stock market losses and fear that his fellow Republicans could face political repercussions at the ballot box on November 5th
"No more easy money for corporate criminals. Just hard time," Bush promised as he signed the measure in an elaborate White House East Room ceremony attended by about two dozen key Democrats and Republicans, but few corporate CEOs.
The legislation creates a new oversight board for the accounting industry, until now a largely self-regulated profession implicated in a series of corporate meltdowns ranging from Enron to WorldCom.