We have waited 5 long years to see one SOX victory. Do we finally have one?
UnitedHealth ex CEO Dr. Mcguire has “returned” hundreds of millions to settle an options backdating scheme that also led to his departure from the company. The regulators are celebrating this as a great victory. Cheerleaders from all sides are also raising their pom poms in victory. Have the regulators finally got one?
Dr. McGuire gets to keep $800 million and does not serve a day in jail. Now how does this victory look to you?
The purpose of any verdict is obviously to do justice in the situation. But there is also a much more important objective of setting precedent – that serves as a deterrent to future offenders.
This outcome is does not serve as any deterrent to anybody with a single neuron firing. This should be an encouragement to potential offenders. 1) These cases are extremely hard to prosecute even if they are somehow discovered. 2) If the worst that can happen to you is a fine that you can easily afford without affecting your life of luxury in any way you are not going to change your ways.
SOX, in my opinion, has yet again proven to be a hollow promise. The regulators have yet again failed to uphold the law. The shareholders have yet again lost. Plain and simple.
