John Sarbanes: “I was going to say that is absurd, but as far reaching as that sounds, the answer to the question is yes. That is one of…”

“I was going to say that is absurd, but as far reaching as that sounds, the answer to the question is yes. That is one of the reasons the potential that results from this legislation is so far reaching. Gretchen Morgenson, on April 6, 2003, had an article in the New York Times headlined ``Advisers May Get Second Chance To Fail.'' She starts the article as follows: Do you think Salomon Smith Barney, the brokerage firm that bankrolled WorldCom and advised it on a business and financial strategy that failed rather spectacularly, should be allowed to represent the interests of the company's employees, bondholders and other creditors while WorldCom is in bankruptcy? She goes on to say: If you answered no, you win a gold star for common sense and for knowing right from wrong. We are just trying to get a ``no'' answer put into section 414 of this bill. We have tried to make a reasonable and balanced modification that essentially preserves the basic conflict of interest protection but does allow this greater flexibility for investment banks that have not recently underwritten securities for the company to serve as advisers in the bankruptcy. But to simply remove the existing provision in the law altogether is to open up the possibility for abuses of major dimensions. Therefore, I very strongly support the amendment being sponsored by Senator Leahy and by Senator Warner.”