Bush demands new fraud laws

Bush will "vigorously pursue" lawbreakers

US President George W Bush says he wants urgent legislation to penalise companies and individuals involved in corporate fraud.

There is no good reason for the legislative process to take that long

President Bush

In his weekly radio address on Saturday, Mr Bush urged Congress to iron out its differences by August and give the president a bill that would "bring a new era of integrity to American business".

The call is the latest attempt by the US president to restore confidence in business practices after accounting scandals involving companies including Enron, WorldCom and Merck.

But his speeches over the last two weeks have all failed to stop share prices falling.

On Friday, investors' confidence was further dented by reports of a criminal investigation into US drug giant Johnson & Johnson and fears of poor financial results at hi-tech and telecoms firms in Europe and the US.

Corporate scandals

Enron: Inflated profits, collapsed

WorldCom: Overstated profits by $3.8bn

Andersen: Auditors for Enron and WorldCom - found guilty of obstructing justice

Also under fire: Xerox, Tyco, Global Crossing

Mr Bush has already urged longer prison sentences for corporate fraudsters and announced the creation of a new taskforce to pursue and prosecute corporate criminals.

The Senate has unanimously approved sweeping reforms in corporate accountability.

However, these have to be reconciled to a weaker bill which was passed by the lower House of Representatives in April before the WorldCom affair broke.

Firm action

"Workers have lost jobs, and the trust of the American people has been betrayed," Mr Bush says. "Unethical business practices by corporate leaders amount to theft and fraud."

He called those practices "unacceptable" and promised to fight them with "active prosecutions and tough enforcement" by the Securities and Exchange Commission.

Measures proposed by the president

Longer sentences for corporate fraudsters

New corporate fraud taskforce

More money for SEC watchdog

Pay packages for bosses explained in plain English

More independent directors for firms

Stock option plans need shareholder approval

Special payments to bosses under investigation to be frozen

Compensation committee to stop 'improper loans' to CEOs

Tougher laws against document shredding

"We will defend the rights and interests of every American worker and shareholder, and we will not accept anything less than complete honesty," he says.

The president is urging congressional negotiators to work out their differences over legislation that would increase penalties for corporate fraud and strengthen oversight of the accounting industry.

He wants Congress to send the final bill "to my desk" before adjourning for the August recess.

"I am confident that the differences between the House and the Senate approaches can be bridged," Mr Bush says.

"Some in Congress have predicted that it will take two months for the House and Senate to send a bill to my desk. There is no good reason for the legislative process to take that long."

Mr Bush also demanded fiscal restraint, urging Congress to curb excessive spending in order to return to a budgetary surplus.

He said he would ''if necessary enforce discipline in budgetary spending''.