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LETTERS

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									                                                                                                 LETTERS
     ing Standards Board (FASB) to testify annually to Con-
     gress on the steps they have taken to reduce the com-
     plexity in financial reporting and to provide more
     accurate and clear financial information to investors.            Increase Profits at All Costs
        This is a bill that the House passed in the two previ-         It seems like it was only yesterday that my article about
     ous Congresses only to watch the legislation vegetate in          whistleblowers [“Whistleblowers: A Rare Breed”] was pub-
     the Senate Banking Committee, which has jurisdiction.             lished in Strategic Finance [August 2003]. Although the arti-
     The bill never moved an inch off that Committee’s dock-           cle was published more than six years ago, executives of
     et. Rep. Christopher Lee (R.-N.Y.), who championed the            leading organizations (corporations, financial institutions,
     bill in the House this year, thinks the legislative climate is    government agencies) still have not learned their lessons and
     more conducive to Senate passage this year, given the             continue to participate in illegal and/or unethical behavior.
     concerns about financial industry accounting and hijinks             The current recession was caused primarily by executives
     raised by last year’s Wall Street debacle. He’s trying to         in organizations who did whatever necessary to increase
     give the financial reporting transparency issue a populist        profits at all costs. Those executives stooped to illegal
     twist—i.e., Americans need better information in order            and/or unethical behavior in their quest to justify their exor-
     to make decisions about their retirement accounts. Lee            bitant salaries and bonuses.
     also thinks accounting rules could be improved for the               The latest example was the drug giant Pfizer, who agreed
     sake of easier corporate compliance, which isn’t exactly a        to pay $2.3 billion in fines and penalties to settle the
     new thought. He states, “It is critical that we take care to      largest pharmaceutical fraud case ever pursued by the U.S.
     identify the complexities that trip up everyone from              Department of Justice. The probe was triggered by whistle-
     small businesses to large corporations and then pursue            blowers who will share more than $100 million for bringing
     reforms that may simplify and improve the process.” The           Pfizer’s actions to the attention of authorities.
     kinds of things Lee expects the SEC/FASB annual testi-               The primary Pfizer whistleblower was John Kopchinski, a
     mony to cover are assessments of complex and outdated             U.S. Gulf War veteran and former Pfizer sales representative.
     accounting standards, increasing the usability of the             Kopchinski said, “In the Army I was expect
								
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