New York (June 30, 2004) -- A recent study provides ammunition for current demands for more independence on the part of corporate boards, showing a correlation between a higher proportion of independent, outside directors and a lower likelihood of corporate fraud.

The study compared 133 companies that were accused of fraud between 1978 and 2001, and 133 companies of similar size and from the same industries that were not, searching for significant differences in director independence, board size and other variables. The result showed that the boards of the companies that were accused of fraud had fewer non-executive directors and fewer independent directors, and lower levels of independence on their audit, compensation and nominating committees.

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