Bush pledges 'financial crimes SWAT team'

PRESIDENT George Bush travelled to the heart of corporate America yesterday to the call for stiff new penalties for financial criminals and a crackdown on boardroom scandal.

He promised, in a speech on Wall Street, that he would “end the days of cooking the books, shading the truth and breaking our laws”.

Confronting a wave of corporate wrongdoing that has undermined investor confidence and threatened political damage to the White House, Bush said, “We will use the full weight of the law to expose and root out corruption.”

He proposed doubling the maximum prison term for mail and wire fraud to ten years and strengthening laws criminalising document shredding and other forms of obstruction of justice.

The President called on the US Sentencing Commission to recommend longer prison terms for corporate executives guilty of fraud and announced a new task force for the pursuit and prosecution of corporate criminal activity. Bush likened it to a “financial crimes SWAT team”.

Titters of knowing laughter rippled through the audience when Bush went after stock analysts who have misled clients in order to inflate stock prices.

“Buy should not be the only word in an analyst’s vocabulary, and they should never say hold when they really mean sell,” Bush said.

Democrats called the proposals inadequate and Wall Street appeared unexcited about the changes, many of which had been made public before the speech. Shares drifted mostly lower while Bush spoke, but the losses in the indexes were limited and in keeping with the tone of earlier trading.

“I don’t think the speech had that much of an impact. said Jack Francis, head of Nasdaq trading at UBS Warburg. “I think actions speak louder than words. If somebody goes to jail, maybe people will take corporate America a little more seriously.”