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Spitzer : 'We all have to play by the same rules'

New York state Attorney General Eliot Spitzer delivered the annual Abraham J. Briloff Lecture Series on Accounting and Society Tuesday in the Anderson Center Concert Theater. Spitzer discussed ethics in financial markets. Photo by Evan Kestnbaum
Ethics do matter, New York State At- torney General Eliot Spitzer told a Binghamton University audience of students and faculty Tuesday, and warned, “We all have to play by the same rules.”

“The moment you begin to think you are beyond reproach and not accountable that is the moment you can be brought down.”

Spitzer, who has gained national attention for his investigations of corporate fraud and Wall Street corruption, delivered the annual Abraham J. Briloff Lecture on Accounting and Society to a near capacity audience in the Anderson Center. Briloff, who was on hand for the lecture, is widely recognized as the ethical conscience for the business and accounting professions.

Spitzer focused on the two issues that he said have defined the current climate: the dilution of federal oversight and the decline in ethics across all sectors. Beginning with the Reagan years, Spitzer said the federal government began turning over enforcement to the states in the belief by some that the new federalism would promote no enforcement whatsoever.

When the states, through their attorneys general, started taking the lead in enforcement in such areas as tobacco and anti-trust, the new federalists began looking for ways to pre-empt state power, he said. Spitzer said ethical lapses also flowed out of the 1980s excesses that lost sight of the boundary lines in the private sector, as well as government, not-for-profits, religion and the media.

Boards of directors, accountants and corporate lawyers ceded their responsibilities to “imperial CEOs,” he said.

Spitzer reserved some of his harshest criticism for auditors, whom he called “abject failures.” “Too much of accounting had become gamesmanship,” he said. “Accountants need to see themselves as a subject of ridicule to understand how far they had strayed from accounting principles.”

The solution, Spitzer argued, is to reestablish the ethical boundaries. “In a business context, corporate governance must take every violation seriously.”

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Last Updated: 10/14/08