House, Senate agree on corporate fraud bill
Bill addresses 'egregious problems'
CNN Washington Bureau
WASHINGTON (CNN) -- House and Senate negotiators reached a deal Wednesday on a bill to rein in corporate wrongdoers and toughen oversight of the beleaguered accounting industry, lawmakers announced.
Floor action is expected Thursday in the House and before the end of next week in the Senate.
Few details of the agreement were released, but House members said the legislation largely resembles the Senate-passed bill -- which is considered tougher on corporations than the original House measure. But House Republicans, who last week followed up on their own bill with one that called for stiffer penalties, said they added a few measures that strengthened the Senate bill further.
In the weeks since corporate scandals have rattled Wall Street and soured investor confidence, Democrats and Republicans have engaged in a game of political one-upmanship over which party is taking the tougher stand against corporate chicanery.
"The legislation we crafted in conference goes a long way in solving the egregious problems that have arisen as a result of corporate misconduct and accounting scandals," said Rep. Michael Oxley, R-Ohio, chairman of the House Financial Services Committee. "It's not a total answer, but I think we made excellent progress, and the White House has informed me this morning that they support the conference agreement."
New York Rep. John LaFalce, the top Democrat on the committee, said Republicans were forced to follow suit after Democrats led the way in cracking down on corporate abuse.
"Throughout the legislative process, Republicans have tried to weaken these provisions, offering only cosmetic reform," he said. "We happily accept the Republicans' unconditional surrender and welcome them, even at this late date, to the fight for tough legislation."
A key sticking point was the independence of a newly created accounting industry oversight board. Oxley said the senators agreed to a House demand that the board remain under the control and oversight of the Securities and Exchange Commission.
Senators also agreed to include stiffer criminal penalties for corporate malefactors that were passed by the House and to create a restitution fund for investors made up of the penalties paid by corporate wrongdoers. The Senate also agreed to require instant disclosure of stock sales by corporate executives, Oxley said.
The White House had pushed Congress to craft a bill before it leaves for its August recess. Lawmakers also faced pressure from falling stock markets and rising public anger over corporate scandals.
House GOP aides said a conference committee was to meet Wednesday afternoon to adopt the agreement formally. But one Senate Democratic aide cautioned that the deal is not set in stone.
"It's not yet signed, sealed and delivered," he said.
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