Washington, D.C. — Okay, I want to be clear on this.
In the current economic free fall where investors have watched trillions evaporate like snowflakes in a convection oven and the government is ponying up additional billions in stimulus and bailout packages, a cadre of plaintiffs who apparently won’t take no for an answer are appealing to the Supreme Court to challenge the constitutionality of the PCAOB.
Let me take a poll. Who among us feels that what the country needs in this economic climate is a further repeal of oversight and regulation?
Bueller? Anyone? Bueller?
Apparently the collapse of the subprime mortgage markets along with a roster of global financial firms and banking institutions wasn’t enough to sway some people as to the value of oversight.
Apparently unwilling or unable to understand the meaning of “no,” Nevada-based accounting firm Beckstead & Watts, along with the Free Enterprise Fund and joined more recently by the advocacy group Competitive Enterprise Institute and law firm Jones Day, plan to petition the nation’s High Court after being shot down by an appeals court and more recently, the U.S. Court of Appeals, in their seeming obsession to dismantle the audit overseer.
This multi-year exercise in legal nonsense stems from a challenge to the PCAOB's constitutionality on the grounds that the board violates the Constitution's appointments clause, which requires that major officers be appointed by the president with the advice and consent of the Senate.
The members of the PCAOB are chosen by the SEC.
The suit argued that the current system avoids the individual accountability that the Constitutional Framers viewed as crucial to reining in government.
I find it amusing that when you get taken out to the woodshed for conducting deficient audits, as did Beckstead & Watts several years ago, how much more unconstitutional a body like the PCAOB can appear.
I have faith that the Supreme Court will vote the same way as the lower appellate courts. I’m sure they have far more important cases on their docket.
And as for the plaintiffs, allow me to offer a visionary suggestion: Try conducting more thorough audits.
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