Good morning. I am very pleased to be here to recognize the fifth anniversary of the Corporate Fraud Task Force.
I would like to begin by thanking and congratulating all of you, on behalf of the President and the American people, for your hard work and for your many successes over the past five years.
Each of you has been a part of this important effort to preserve the integrity of our financial system. And each of you has played a critical role in accomplishing an important goal.
That goal – set forth by the President in creating the Task Force – was to strengthen the efforts of the Department of Justice and Federal, state and local agencies to prevent and prosecute financial crime.
After five years of hard work by the prosecutors, agents, and policy-makers in this room, you have accomplished and even exceeded that goal.
We will never know how many investors were spared thanks to the work of the Task Force. In just five years, you've cleaned up a lot of fraud, from New York to New Hampshire to Colorado. And as a result you've helped to create an environment where honest businesses can compete and thrive.
But perhaps the most important accomplishment is the criminal conduct that never occurred because of the wide-spread deterrent effect triggered by the tireless and thorough efforts of the Task Force and everyone in this room.
As this is a recognition of your success, I thought that it would be worthwhile to look back.
In 2002 we were faced with a problem that needed fixing. Though the vast majority of individuals working in corporate America are honest, and most businesses strive to do the right thing, there was something wrong with the culture of some corporations -- even some of the largest in America. It is worth remembering the frustration with which we, as a government and as a Nation, reacted to the stories of Enron and WorldCom – and the excesses misconduct of their top executives.
There was disbelief that a well-known American company could be nothing but a house of cards. Our hearts went out to the parents who could no longer afford to send their children to college, or the elderly couple who lost their retirement savings. Some began to doubt the integrity of our financial markets.
So the President created the Corporate Fraud Task Force to coordinate our efforts across the federal government and with our state and local partners. And by working together, we were able to take the necessary steps to restore public confidence.
Five years later, the Task Force is defined by a commitment to upholding corporate and market integrity for current and future generations of Americans.
Creating the Task Force was an important first step, but it was not the only step that we as a government took to address the problems we faced.
We began to streamline the way we approach complex corporate fraud cases. We broke large investigations into smaller, less complex pieces and brought those cases faster, especially if those smaller cases could help us develop cooperating witnesses in larger cases.
Congress passed the Sarbanes-Oxley Act, giving law enforcement new tools to combat sophisticated white collar fraud.
We dedicated new resources to combating corporate fraud wherever we found it. And when we started using those resources and implementing this new approach, we learned that the early cases that grabbed headlines in 2001 and 2002 were in many ways just the tip of the iceberg.
By May of 2007, we'd obtained more than 1,200 convictions, including 214 corporate chief executives or presidents. And we've won hundreds of millions of dollars in fines and in restitution to investors, who are the ultimate victims of corporate fraud.
Through criminal trials and other methods -- like deferred prosecution agreements – the Department of Justice and its partners on the Task Force have made clear that we expect private industry to help ferret out fraud and to work with us. For example, an important part of many of the agreements is the company's commitment to improved internal, corporate compliance. We are not only looking to punish past bad behavior, but are also interested in future good conduct. That is why we encourage corporations to be more responsible for ensuring that good conduct.
Our victories have been about more than just compiling statistics or making an example out of one or two bad actors. They have been about preserving the integrity of our corporate boardrooms and our financial markets…about changing a culture…about redefining the way companies do business.
The importance of integrity in the marketplace is not lost on investors. The markets want, and will reward, reliability, integrity, and transparency in American companies. Investors don’t put their money into companies – or markets – that they do not trust.
It is this demand for integrity – and the highly-visible actions of the Task Force to preserve that integrity – that have changed corporate America for the better.
Boards have restructured and reinvigorated themselves. Audit committees have stepped up efforts to monitor their accounting practices. A new era of corporate responsibility has begun, due in no small part to the men and women in this room. These are the fruits of our labor, and you should be proud of them.
Today’s event is largely about looking back over the past five years and acknowledging our accomplishments. But just because we are marking this anniversary today does not mean we are slowing down our efforts.
Let me be clear: combating white collar crime and corporate fraud is as high a priority today as it was when we began this effort. Indeed, just a few weeks ago four corrupt corporate executives were sentenced to terms in prison ranging from three to eleven-and-a-half years.
And we are continuing our efforts by staying on top of emerging trends like the fraudulent practice of backdating stock option grants.
Recent cases demonstrate that we will not let up the fight to preserve the integrity of our corporations and our financial markets. We will remain on the offensive against corporate corruption, in whatever form it takes and wherever we find it. We will punish the perpetrators of fraud and seek justice for the victims of these crimes.
In closing, I would like to once again thank the dedicated career prosecutors, investigators, staff, and members of the Task Force for their tireless dedication over these past five years.
I would especially like to thank Deputy Attorney General McNulty for his fine stewardship of the Corporate Fraud Task Force over the past two years, as well as Chairman Cox and Director Mueller for their strong and continued partnership in this important area.
The actions we have taken together – and the actions we will take together in the future – will produce lasting benefits for the American people and the American economy.
Each one of you has been a part of making our economic system stronger, and each one of you should feel immense pride at being a part of this historic effort.