Senate Wants to Pass Dangerous Just Open Bucket Shops Act (so-called Jobs Act)

You may not remember the analyst scandal that fueled the dot.com bubble (Pets.com?, Homestore.com?)  or the Enron scandal (Ken Lay, Arthur Anderson, audit failure, billions in losses, gimmicks named for Star Wars characters, follow-on Worldcom collapse) since they are so yesterday’s news.

Don’t worry. The House and Senate don’t remember, either. If the Senate has its way with quick passage of the misnamed already-House-passed  Jobs Act, — better named by the New York Times columnist Gail Collins as the “Just Open Bucket Shops Act” — conflicted analysts like Jack Grubman and Henry Blodget (like them, but not them– they’re barred for life) will be making stuff up again, government watchdogs like the SEC and PCAOB will be chained, and small and novice investors will be looking at “crowd-funded websites” from good guys and bad guys, too, including often-fraudulent Chinese IPOs. How will they tell the difference?

Things are so bad that the Senate’s leading investor champions aren’t even sure they can get enough votes to modify the proposal — let alone block it — even with a compromise alternative (letter from PIRG-backed AFR/CFA). Only in Washington.

This comprehensive testimony by former SEC Chief Accountant Lynn Turner explains the problems in the Jobs Act in greater detail. Senator Carl Levin (MI), an investor champion who chairs the Senate Permanent Subcommittee on Investigations, explains his alternate proposal. Action in the Senate next Tuesday.