While in college I once was waiting on a snaking line to see a very forgettable film called "The Cheap Detective," when by chance, I found myself standing in front of the late Alan Berg, the controversial radio talk show host who, six years later, would be tragically gunned down in front of his Denver home by white supremacists.
Berg, as some of you may recall, addressed an array of then-taboo topics for the still-uptight 1970s airwaves, and was regularly threatened by fanatical right-wing and neo-Nazi groups that, until 1984, proved to be just idle threats.
Berg, whose character later served as the basis for the 1988 movie "Talk Radio," managed to engage me in discussion of a dizzying array of subjects while we made our respective way to the ticket booth, including compulsive gamblers (he admitted to being a recovering one), corrupt politicians and corporations (regular targets on his show), and how time almost always manages to conveniently erase people's memories of egregious acts, providing a second chance in life for some people who probably didn't deserve a first one.
A strain of preferential amnesia, if you will.
Although the ruins of Enron and WorldCom are just over three years old, amnesia over why we have Sarbanes-Oxley on the books seems to be affecting some high-profile corporate folks.
Take media titan Barry Diller, for one.
Diller, the former chairman of Paramount Pictures and currently an online mogul whose portfolio includes Lendingtree.com and Ask Jeeves, said last week that lawmakers should revisit Sarbanes-Oxley because the high cost of compliance is negatively impacting American businesses.
Diller told the New York Post, that Congress should see "what was smart about it [SOX] and what wasn't." He added that "99.9 percent of the processes" in Sarbanes-Oxley have nothing to do with corporate malfeasance and affixed to SOX Section 404 such endearing adjectives as "ridiculous" and "wasteful."
I wonder if former employees of Enron or WorldCom, who watched their retirements evaporate under the aegis of the sticky-fingered vulgarians who ran those respective companies, would agree with the assessment of a Hollywood billionaire.
What's perhaps more troubling is how many executives at Diller's level harbor similar feelings about the sweeping reform act?
In case they or anyone else is in need of a refresher course, corporate fraud of an $11 billion nature at WorldCom, or the collapse of what was once the country's seventh-largest company, were pretty fair reasons for Sarbanes-Oxley being passed in the first place.
I doubt you'll receive much argument -- even from regulators -- that SOX doesn't have its trouble spots, as evidenced by the fact that 404 compliance dates for small filers have now been pushed back twice. And others will rightly point out that you can't legislate ethics or honesty.
Fair enough.
But if Diller and company feel that strengthening internal controls is "ridiculous" and does nothing to engender better corporate governance, then may I suggest taking a small portion of your holdings, going to the Bank of Reality and opening an account.
And hope that they're SOX-compliant.
