Independent Audit Committees and Risks to General Counsel

• Posted by Geoffrey G. Gussis on February 18th, 2005


• Filed in Corporate/M&A, Risk Management & Compliance

Corporate Counsel has a great article on the risks to general counsel posed by the myriad of rules and regulations that have been promulgated pursuant to the Sarbanes-Oxley Corporate Fraud and Accountability Act of 2002.  The risks are real, as the article points out:

"The risks of noncompliance with the new auditor-independence rules and regulations cannot be overstated. General counsel who fail to comply face stiff civil fines and penalties, including losing the right to practice in SEC-regulated matters. In a world replete with daily reports about chief executive officers, chief financial officers, other corporate executives and auditing firms facing various allegations of securities fraud, general counsel must proactively seek out all areas of their companies’ audit structure that may give rise to liability — not only liability of the issuer-company, but also the possibility of personal liability."

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