The Enron Collapse and Criminal Liabilities of Auditors and Lawyers for Defective Prospectuses in the United States, Australia and Canada: a Review
Bibliographic record
Abstract
A lack of uniformity in laws regulating professionals such as auditors and lawyers in relation to defective prospectuses exists across nations around the world. Securities legislation of some jurisdictions clearly imposes criminal liabilities for defective prospectuses on professionals along with directors and promoters of the issuer of securities. But the laws of some other countries are ambiguous in this regard. Such an ambiguity is present in the securities legislation of the United States, Australia and Canada. Their legislation does not categorically name the persons who should be criminally liable for a defective prospectus; nonetheless auditors and lawyers are sometimes caught by virtue of judicial interpretations of those vague legal provisions. Even though they could be on the hook under such interpretations, legislation provides a wide range of defences that facilitate escaping liabilities by offenders at the expense of the integrity of the market. Regarding sanctions, although the term of imprisonment is identical in all these three jurisdictions, pecuniary penalties significantly vary after the recent reforms triggered by some spectacular corporate bankruptcy taking place especially in the U.S. and Australia. Most importantly, the post-Enron reforms explicitly amend the laws governing secondary securities markets, and therefore their application to defective prospectuses is questionable except for the Canadian reforms. If the post-Enron reforms do not really touch the prospectus liability regimes in the U.S. and Australia, it can be said that the lawmakers have ignored their primary securities markets. If this is so, it would be an unwise policy to wait for an Enron-type disaster to occur in the IPO market for stimulus to initiate reforms addressing professional malpractices in the preparation of prospectuses. If not, the law should make it clear before it is too late.
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How this classification was reachedexpand
Full frame machine prediction
Teacher imitationNot calibrated prevalence, not ground truth. Human validation pending. The Gemma side is a direct model label for every work in the frame, read from the title-only record. The Codex side is a classifier learned from the 10,348 direct Codex labels and calibrated to design-weighted sample rates; fields without enough sample support carry no Codex call. Candidate is the union of the two sides; consensus is their intersection. These outputs are machine_predicted_unvalidated and are not human labels.
Distilled classifier scores by category (both heads)
| Category | Codex | Gemma |
|---|---|---|
| Metaresearch | 0.004 | 0.010 |
| Meta-epidemiology (narrow) | 0.001 | 0.001 |
| Meta-epidemiology (broad) | 0.002 | 0.001 |
| Bibliometrics | 0.014 | 0.016 |
| Science and technology studies | 0.001 | 0.002 |
| Scholarly communication | 0.003 | 0.002 |
| Open science | 0.002 | 0.001 |
| Research integrity | 0.002 | 0.002 |
| Insufficient payload (model declined to judge) | 0.003 | 0.000 |
Machine scores (provisional)
The two teacher heads of the student model, read on this work. A score orders the frame for review; it never asserts a category, and the validation status ships verbatim with every row.
Baseline scores from an immature model (maturity gate not passed, 7 training rounds). Scores rank; they never assert a category.
score_only:v0-immature-baseline · verbatim from the scoring run: score_only means the number may rank works, and no category label ships from itClassification
machine, unvalidatedMachine predicted; a candidate call from one source (direct Gemma or distilled Codex), not a consensus.
How this classification was reached, model by model and score by score, is at the end of the page under "How this classification was reached".