Greenspan disses Sarbox

Alan Greenspan, former chairman of the Federal Reserve, who supported passage of the Sarbanes-Oxley Act, now says it should be revised.

"The Sarbanes-Oxley Act has created significant problems for foreign investors with its regulatory structure," he said at a question and answer session at the Asian Financial Centres conference in Seoul, organised by the Financial Times. "I am nevertheless acutely aware and disturbed by the fact that initial public offerings have moved away from the US - and to a large extent have moved to London."

Greenspan specifically criticized Section 404:

Although the basis of the law was a definite advance in terms of governance, some parts of it created too many burdens for business, he said, emphasising the provision that forces companies to have their internal controls certified by auditors.

Greenspan said he thought the law would be changed, but FT seemed to question that. Rudy Giuliani, speaking at the same conference said he thought London and Tokyo would likely pass similar rules.

As we've previously reported, there is also a challenge to Sarbox in the courts.