Washington -- The General Accounting Office has submitted 12 recommendations to the Securities and Exchange Commission in its effort to resurrect investor confidence and strengthen the listing standards of the three largest securities markets -- the New York Stock Exchange, the American Stock Exchange and the Nasdaq.


In a 125-page report, the auditor general, who examined the issue of restoration of investor confidence after the Sept. 11 attacks, advised the SEC’s Office of Compliance Inspections and Examinations to:

  • Work with the NYSE, Nasdaq and Amex to ensure that the public receives early notification of any issuer non-compliance with their respective listing standards.
  • Ensure that the SEC quickly finalizes a rule requiring issuers to file 8-K forms after receiving a notice of deficiency.
  • Implement a policy requiring the OCIE staff to use self regulatory organization (the securities markets) internal reports in planning and conducting inspections.
  • Work with the markets to enhance board independence by requiring issuers to establish a “supermajority” of independent directors and separate the posts of chairman and chief executive.
  • Work with the SROs to ensure they have established effective issuer compliance with corporate governance listing standards and:
  • Ensure that the OCIE conducts regular and timely inspections of the SROs to assess oversight to issuer compliance.

The full report is available at www.gao.gov

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