Mr. Speaker, the point I was beginning to make was there comes a time when white collar crime becomes a blue collar issue, a working class issue, a working person's issue. Even if most ordinary working people in Canada do not invest in the stock markets or the financial markets, almost all of us are indirectly involved through our employee pension plans and our health and welfare plans. Even the Canada Pension Plan is now privately invested on the open market.
Therefore, Canadians have to wake up frankly, and realize that there is a serious problem of confidence in our financial marketplace. We have to be able to trust the financial statements of the companies in which our retirement income is invested. Therefore, many Canadians have been horrified to watch the meltdown on Wall Street and an equal crisis in confidence on Bay Street, as they watched in horror WorldCom, Enron, Nortel, ImClone, Tyco. We could go on and on because there has been an absolute epidemic of unethical practices revealed on the financial markets of North America, which has created a genuine crisis in confidence.
Compare Bill C-46, as we have it today, which is to deal with capital markets fraud and evidence-gathering, with the Sarbanes-Oxley act in the United States. Compare the difference between the protection of pension incomes in that country compared to Canada. The Prime Minister of Canada essentially ignored and was silent on the issue of the crisis of confidence. Our finance minister was virtually silent. His reaction in fact was to strike a wise person's committee and to ask Bay Street and the Institute of Chartered Accountant to get into a voluntary compliance with ethical standards.
Compare that with the United States when the President stood up and said that if companies were defrauding the American people, the administration would hound them down, find them, catch them and put them in jail. Whether they were members of a corporate board of directors or CEOs of companies, they would pay big time. That was the difference, the contrast in the approach.
As a representative of working people in my former life as a trade unionist, who has sat on the pension plans of the union movement and have some knowledge of how that money is managed on behalf of working people, believe me, I take no comfort in the reaction of the Canadian government to this crisis in confidence compared to the very legitimate efforts made in the United States.
The bill is silent on a number of issues. I do not see a lot of reference to it in the recommendations put forward in the proposed amendments, rather than the amendments that we now see. We were hoping to see a serious crackdown in some very glaring, obvious and easy to fix shortcomings of the current securities marketplace.
The first, to which I would like to speak, is the idea of the complete independence of auditors. What happened at Enron, what happened at WorldCom, what happened at Tyco is that the same chartered accounting firm, in this case, Arthur Anderson, which was keeping the books, doing tax consultation and database design, was also hired as the auditor.
How can we trust the financial statements of a company, if the same company is asked to keep the books and audit the books? That same situation exists in Canada today. Even with the voluntary measures undertaken by the Institute of Chartered Accountants, it sees nothing wrong with the company that is the auditor also doing the tax consultation, et cetera. Can it not see this glaring conflict of interest? I should mention that this could be remedied by a simple change to the Canada Business Corporations Act. It has been brought to the attention of the government and it has chosen not to act.
Another glaring issue that is quite easy to fix is the idea of expensing of stock options, that is, having these costs show up in the expense column of the company's financial statements.
If a company is going to use stock options as part of the executive compensation of the company, then investors should know. The liability of outstanding stock options often exceeds the net worth of the company. Even as a blue collar socialist, I know the danger signals associated with that.
If a person is going to use--