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Really? ….
‘..The Justice Department's decision to charge Arthur Andersen was based at the time on the determination that the substantial destruction of documents in anticipation of an investigation ..’
Subsequently, as the Securities and Exchange Commission (search) began looking into Enron's convoluted finances, Andersen put in practice a policy calling for destroying unneeded documentation.
Government attorneys argued that Andersen should be held responsible for instructing its employees to "undertake an unprecedented campaign of document destruction."
The Supreme Court (search) overturned the conviction of Arthur Andersen for destroying Enron Corp.- related documents before the energy giant's collapse
Giving his opinion, Rehnquist noted that jurors were instructed to convict Andersen if the accounting firm had an "improper purpose," such as an intent to impede or subvert fact-finding in an "official proceeding." He noted jurors were instructed to convict, even if Andersen mistakenly thought it was acting legally
Therefore, guilt or innocence is overshadowed by process (incorrect jury instruction) and not whether Andersen was guilty or not – seems like a get out of jail card
Always understood that ignorance is no excuse – in any event how can wholesale destruction of financial documents prior to a SEC enquiry into a company’s finances be remotely thought of as acting legally?
…. and now an ex-partner of Andersen’s at the time of problem wants to resurrect the Andersen name !
Whilst accounting firms of this size are probably not subject to rules like everyone else but what happened to 'joint & several'?