Dec 09

A Fishy Application of the Sarbanes Oxley Act

By Renee Howdeshell in Commentary, Discovery, Fraud, Just for Fun, Public Policy
December 9, 2014

The Supreme Court has been asked to decide the case of a commercial fisherman accused of harvesting fish too small to meet federal fishing guidelines. The reason the highest court in the US will hear the case? Federal prosecutors have applied provisions of the Sarbanes-Oxley Act in trying their case. The scope of such application is an issue of potentially wide reaching affect.

Fisherman John Yates was caught with the undersized fish by a fish-and-wildlife officer. The officer issued a citation and ordered Mr. Yates to bring the fish back to port. As Mr Yates violated that order and instead instructed his crew to throw the fish overboard, federal authorities claim that Yates violated components of the Sarbanes-Oxley Act. (“SOX”). SOX makes it a crime to destroy “tangible objects” in order to obstruct a government investigation.

However, many are questioning the application of this legislation, designed to prevent document and other evidence destruction in corporate fraud matters. In this matter, Yates faced 20 years per discarded fish. Although a jury convicted him (albeit with a 30 day jail sentence), the Supreme Court has so far seemed to question the sensibility of the government’s chosen path in relying on SOX. A decision is expected by July 2015.

Renee Howdeshell

Renee Howdeshell is a founding member of Fulcrum Inquiry, an accounting, finance and economic consulting firm that performs damage analyses for commercial litigation, forensic accountings, royalty & distribution audits, financial investigations, and business valuations. Ms. Howdeshell holds a degree in Finance and Marketing from the University of Virginia's McIntire School of Commerce and is a Certified Public Accountant (CPA) and a Certified Fraud Examiner (CFE). She has testified as an expert witness in federal court, CA state court and arbitration regarding the results of her work. She can be reached at (213) 787-4112 and her resume is available at www.fulcrum.com.

Permanent link to this article: https://betweenthenumbers.net/2014/12/a-fishy-application-of-the-sarbanes-oxley-act/

Leave a Reply Cancel reply

Sponsor

Between the Numbers is sponsored by Fulcrum Inquiry. Fulcrum Inquiry is a consulting firm whose services include calculation of litigation damages and related expert testimony, forensic accounting, financial investigations, economic analysis, and business appraisals.

Thought for the Day

“Virtually nothing on earth can stop a person with a positive attitude who has his goal clearly in sight."

Denis Waitley (1933 - )

Motivational speaker & best-selling author

Comments Policy

All postings (including those associated with Fulcrum Inquiry) are the opinions of their respective authors, and do not necessarily reflect positions of Fulcrum Inquiry.

Anyone is allowed to post comments on any article; however, comments appear only following review. Advertisements not pertaining to the blog subject, spam (bot generated) comments, foul language, ad-hominem attacks, and immature behavior will not be approved.

The Lawyers Say….

All posts are copyrighted by Fulcrum Inquiry® as of their publication date

The authors and publishers are not intending to render legal, accounting, tax, or other professional advice. No client relationship is established from making general information available on this site, or from your making a comment or transmitting an email message to us. None of the information on this site should be used as a substitute for consultation with competent advisors that are able to consider the application of any general information to your specific situation.

While we have attempted to ensure that information contained on this site is reliable, we are not responsible for any errors or omissions, or for the results obtained from the use of such information. No guarantee of completeness, accuracy, timeliness, or of the results obtained from the use of this information is provided.