“Keep Internet Disclosures From Costing Your Company”

This article affirms what we’ve been teaching at our SuperConferences:

"Answer: The Internet and the Sarbanes-Oxley Act of 2002 (SOX)

"Question: What two powerful forces are generating a whole new world of liability for companies and their directors and officers?

"It is unlikely that this answer-and-question combo will ever appear on the popular TV quiz show ‘Jeopardy.’ But the reality is that as the Internet opens pathways to doing business that could scarcely be imagined a decade ago, it also presents increasing dangers to public companies in the form of new liability risks. The instantaneous nature of the Internet can be both boon and bane to companies seeking to harness it to provide information to, and create goodwill with, shareholders. Not only can information be disseminated over the Net in a fraction of a second for worldwide viewing, but it has become a predominant source of investment news. Financial updates, product developments, information tidbits, even rumors — all are now posted 24/7 on the Web for consumption by anyone, including investors who are poised to take advantage of the latest intelligence.

[snip]

"With securities claims involving improper Internet disclosures on the rise, a company would be wise to institute a review process, carried out by a qualified person (general counsel or compliance officer), to assure that its Internet disclosures are accurate, complete and appropriate. Following are some questions that should be asked as part of an Internet review, along with suggestions for ‘common sense’ measures for reducing a company’s exposure and keeping pace with Web evolution."

Definitely recommend reading this entire piece!

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