US corporate scandals 'largely gone'

O'Neill: New laws have put a lid on corporate fraud

US Treasury Secretary Paul O'Neill has sought to reassure Americans no more "bombshell" accounting scandals are waiting in the wings ready to ambush shaken investors.

The US is on the road to recovery, and that global prosperity requires that all the economies of the world rekindle growth

Paul O'Neill,
Treasury Secretary

In comments on Friday prior to his departure for South Asia, Mr O'Neill said news laws enacted to deal with corporate malfeasance will act as a deterrent to future fraud.

The passage of the Sarbanes-Oxley Act has created an new set of conditions and clarified the role of trust corporate officers are entrusted with, he told reporters in a press briefing.

"There will be ongoing, in the years ahead, occasions where people are found to have abused their trust and responsibility - but the bombshell revelations we had beginning late last year... are largely gone," he said.

The treasury secretary is embarking on a 10-day speaking tour that will take him to Pakistan, Afghanistan, India and the UK.

He also sought to reassure US trading partners the American economy remains on track despite the recent "soft spot" in its recovery.

"The US is on the road to recovery, and that global prosperity requires that all the economies of the world rekindle growth," he said.

Terrorism insurance

Mr O'Neill also said generous aid to war-torn Afghanistan can act as insurance against future terrorism.

"Our reconstruction efforts in Afghanistan are not only vital to the lives of the Afghani people and important for securing Central Asia against terrorist influences, they must serve as a model for what effective foreign assistance programs the world over can achieve," he said

About $5bn (£3.2bn) has been earmarked as financial aid for Afghanistan with about $1.4bn disbursed at the end of October.

Afghani officials say the needs of their country, which has seen war for the better part of two decades, remain enormous.

Mr O'Neill is due to tour Afghanistan sometime next week, although for security reasons the exact time has not been announced.

The visit will give him a chance to assess the rebuilding efforts the US has engaged in having driven the ruling Taleban from power.

"The President is very concerned that we ensure that Afghanistan has the resources to carry out its rebuilding plans and to be able to demonstrate the result from them," Mr O'Neill said.