Reference no: EM133487758

Case Study: According to Brigham and Ehrhardt (2022), criminal provisions are rarely discussed. Critics complain that Sarbanes-Oxley's criminal provisions are needlessly redundant, rely too heavily on enhanced criminal penalties to achieve their goals and attach far too much importance to filling minor gaps in the coverage of existing laws. The key criminal provisions in Sarbanes-Oxley extend new legal protections to whistleblowers, which are likely to provide powerful incentives for potential targets of fraud investigations to become cooperating witnesses. The Act's criminal provisions make significant strides toward piercing the veil of corporate silence and using as its central focus the essential roles that whistleblowers and cooperating witnesses have played in recent corporate fraud investigations.

Question: Brigham and Ehrhardt (2022) further postulated that Sarbanes-Oxley's criminal provisions have not been well-received. Critics complain they are needlessly redundant, rely too heavily on enhanced criminal penalties to achieve their goals, and attach far too much importance to filling minor gaps in the coverage of existing laws. Thus, some critics conclude that the significance of new crimes and higher penalties is vastly overstated. Sarbanes-Oxley's criminal provisions express symbolic political outrage more than a reasoned response to a public policy question. Are there potential international implications for foreign companies not compliant with SOX?