WASHINGTON May 19 Lawyers who provide advice to
public companies about their financial disclosures should be
required to attest to their accuracy and be held more
accountable, a top U.S. securities regulator said on Monday.
"We should be considering attestation in new areas,"
Securities and Exchange Commission member Kara Stein, a
Democrat, said in a speech at the Compliance Week conference in
"Should there be one for registered municipal advisers? Or
one for lawyers on the accuracy of issuer disclosures?" she
The 2002 Sarbanes-Oxley law contains several key provisions
that aim to hold chief executive officers and chief financial
officers more accountable for financial reporting and internal
CEOs, for instance, must sign their name to certify that a
company's financial disclosures comply with federal securities
In addition, attestation rules have since been added in
other areas, such as requiring brokerages to annually certify
the strength of their compliance policies and measures to ensure
executives comply with the Volcker rule's ban on proprietary
"I personally believe that having an executive sign an
attestation leads to a more rigorous internal assessment of a
firm's business and regulatory capabilities. Nothing focuses the
mind like signing your name," Stein said.
When asked during a question-and-answer session if she could
elaborate on the subject, she said she was trying to be
"provocative" and urged the industry to provide feedback on
whether more attestation requirements could bolster compliance.
Stein's speech comes at a time when the SEC is ramping up
its enforcement efforts against so-called "gatekeepers" such as
auditors and boards of directors.
The agency also has the power to bar accountants and lawyers
from practicing before the SEC if they run afoul of federal
"One gatekeeper that often is absent from the list of cases
I see every week are the lawyers," Stein said.
"Are we treating lawyers differently from other gatekeepers,
such as accountants? I think we should carefully review the
role that lawyers play in our markets, with a view toward how
they can better help deter misconduct and prevent fraud," she
(Editing by Jeffrey Benkoe)