Enron and the Corporate Lawyer: A Primer on Legal and Ethical Issues

The stunning collapse of Enron, coupled with the large number of accounting irregularities and apparent corporate fraud, have created a climate in which reform and improvement of the law governing corporate lawyers is underway. The ABA Task Force on Corporate Responsibility has issued a preliminary report that recommends promising changes in the rules of professional conduct. And, the Corporate Reform Act of 2002 has changed the landscape by authorizing the SEC to promulgate rules of professional conduct for securities lawyers and directing the SEC to issue a rule requiring securities lawyers to climb the corporate ladder to prevent or rectify a securities law violation by the corporation or a breach of fiduciary duty by a corporate employee. Some other reforms are also needed, especially a statutory overruling of the Central Bank decision which eliminated private causes of action for aiding and abetting a securities fraud