Mr. Chairman, thank you for continuing these important hearings on corporate accounting fraud and misdeeds. The shenanigans by some of the country’s largest corporations and their accounting firms, and the resulting bankruptcies, have hurt many innocent workers and investors. The American people have lost confidence in the stock market and in corporate America, and they have lost billions of dollars in savings and pension plans. We will hear from just two of those Americans today, but their experience can be multiplied by a million or more.

We are also going to hear today from the executives who ran two of these corporations: Qwest and Global Crossing. They are the people at whose feet the proverbial buck must stop. They are the ones that set unrealistic revenue and growth goals for their employees in 2001 and berated or fired them if they didn’t make those goals. "I do not want to hear about how your part of the business is just going to continue to erode when we meet next week," Global’s head of sales ordered his subordinate. "I want to know what you guys are going to do to turn it around – starting immediately." Documents from last week’s and today’s hearing show they are the ones who knew their revenues could not keep up with projections without these swaps, but didn’t bother to inform their investors. These documents also show the executives are the ones who made illegal side deals – hidden from the accountants because they could not book all the revenue up front if these deals were known.

We have read the e-mails in which these employees acknowledge that the swaps of optical capacity are being done just to meet the numbers. "This swap crap is going to kill us in the long run," a Global Crossing employee wrote. "The sales folks don’t know what exactly they’re getting and product guys haven’t figured out what to do with those assets." Many of those before us today are the ones who benefitted the most from the high stock prices. They are the ones who set a corporate tone that put numerical growth over all else and rewarded those who achieved that growth, no matter what. And they continued their push in the face of a tumbling world economy and the implosion of the dot-com phenomenon.

To rebuild confidence after this sort of debacle, the new management at these companies will need to clean house and instill a new culture. Congress and the public will support those efforts, so long as they are vigorous and effective. Investors and regulators cannot be expected to trust companies that do any less.