MUNCIE, Ind. - A call by President Bush for new laws to crack down on corporate misconduct may play a less significant role than self regulation, says a Ball State University finance law professor.

"After Enron, WorldCom and other scandals, boards (of directors) and shareholders of various corporations are taking steps to stop any potential problems," said Howard Hammer, who teaches courses on government regulation of businesses in Ball State's Department of Finance and Insurance.

"You could say Bush's plan is like shutting the barn door after the horses are gone," he said. "It is now a major political issue and the result is that new regulations and laws will not be comprehensive. It might make some difference, but little at this point."

During a speech Tuesday on Wall Street, Bush called for longer prison sentences for corporate fraudsters and announced the creation of a new taskforce to pursue and prosecute corporate criminals.

Bush also wants to double the maximum prison term for mail fraud and wire fraud to 10 years, and strengthen laws criminalizing document shredding and other forms of obstruction of justice. The president's 10-point plan will require approval from lawmakers, stock market executives, regulators or the companies themselves.

Hammer said corporations began internal reviews in recent months because investor confidence and public trust have been badly shaken by major accounting scandals.

A lack of confidence in accounting procedures usually sends stock prices of any firm in question into a downward spiral, he said.

"That is why self regulation will play a major role here because of stock market prices," Hammer said. "Any uncertainty hurts a company's stock price. No shareholder wants to lose a fortune like people did with Enron or WorldCom."

(NOTE TO EDITORS: For more information, contact Hammer at hhammer@bsu.edu or (765) 285-3727.)