Remarks
Twenty Years After Enron, Investors Are Still Vulnerable to Fraud
Automated data processing and a lack of face-to-face contact make it harder for auditors to spot wrongdoing.
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The collapse of Enron, which filed for bankruptcy protection 20 years ago today, shook the capital markets and led directly to the demise of Arthur Andersen, the auditing firm that approved Enron’s annual statements and accounting acrobatics. The scandals led to new rules and laws for corporations and auditors that were meant to prevent future frauds of such massive scale.
Two decades later, no similar blowups have occurred in U.S. markets. But it’s not clear that investors are any safer today than they were before Enron Corp. failed.