The Risk of Being A Public Company CFO
According to a recent article on CFO.com by Randy Myers, “The drive to combat corporate misconduct is making it a dangerous time to be a finance chief.“
In September 2015, U.S. Deputy Attorney General Sally Yates warned in a widely published memo that the Department of Justice would be doubling down on efforts to hold individuals accountable for corporate wrongdoing.
Yates states; “One of the most effective ways to combat corporate misconduct is by seeking accountability from the individuals who perpetrated the wrongdoing. Such accountability is important for several reasons: it deters future illegal activity, it incentivizes changes in corporate behavior, it ensures that the proper parties are held responsible for their actions, and it promotes the public’s confidence in our justice system.”
“There’s not a public company in America that could withstand a full, substantive audit and not have errors and mistakes found in the books and records of the company,” explains John J. Carney, a former securities fraud chief for the Department of Justice and now co-leader of the white-collar defense and corporate investigations team at Baker & Hostetler. If his assessment is true, it means CFOs are routinely certifying documents that are not 100% accurate. “God willing, the SEC won’t bring cases where there isn’t some direct evidence [of CFO wrongdoing],” Carney says. “If there were a bullseye painted in black on the back of the CFO, now it would be painted in red.”
Learn more about the risk of being a public company CFO and how to mitigate those risks in this CFO.com post: “The Rising Risk of Being CFO“