The SEC filed its first up-the-ladder enforcement action since the passage of Sarbanes-Oxley on Sept. 23, 2004. The wrongdoer: John E. Isselmann Jr., former general counsel of Portland, Ore.-based Electro Scientific Industries Inc. (ESI). His misconduct: participating in a scheme to artificially inflate ESI's quarterly numbers.
Ironically, Isselmann himself was the one who blew the whistle on the company. But the SEC believes--despite a weak attempt to stop the misconduct and ultimately reporting the illegal activity five months later--his noble effort came a little too late.