January 31, 2005

Securities Act Reform Project

The comment period for the Securities Act Reform Project was originally scheduled to close today. There are reports that the comment period will be extended to February 15 – although no extension has been posted on the SEC website yet.

Also, The Financial Times is reporting that there has been opposition by some commenters to the proposal to open up internet roadshows to retail investors. Several fund managers have told the SEC that the proposal could damage the funds’ businesses – they appear to be concerned that either the companies will stop doing the roadshows or that the companies will put less informative roadshows together if they will have to file the information with the SEC. NetRoadShow, a provider of online roadroads to financial firms, has solicited comments in opposition to this proposal on its website.

Former Auditor Sentenced to One Year

One of the first auditing professionals charged with destroying documents in violation of the Sarbanes-Oxley Act has been sentenced to a year in federal prison and ordered to pay a $5,000 fine. A former partner in the San Francisco office of Ernst & Young, Thomas Trauger, plead guilty last October to tampering with the financial documents of online credit card issuer NextCard Inc. He admitted to altering audit records after the SEC raised doubts about the company’s accounting practices.

NASDAQ Non-Compliant Companies

Each trading day, NASDAQ publishes a list of companies that are non-compliant with its continued listing standards. The list can be found here. A company is added to the list five business days after NASDAQ notifies it of the deficiency and is removed from the list one business day after NASDAQ determines that it has regained compliance, or the company no longer trades on NASDAQ.

NASDAQ’s continued listing standards can be found here.

Posted by Julie Hoffman