Arizona Instrument and Nile Healthcare were among several companies that did not return telephone calls. Pioneer Cos., a Houston chlorine manufacturer, was asked in its SEC letter to disclose a worst-case scenario. When he received the letter, Ablove said he assumed that it was a form letter that was mailed to more than 73 companies. Like many, he was surprised to learn Pioneer was among a small group. But, he says, the company doesn't have the manpower to call each supplier to verify that they are Y2K compliant.
Nobody is an island anymore.
Everyone is dependent on everybody else. Shelley Parratt, the SEC associate director of disclosure operations who signed the 73 letters, says the fallout may be shareholder lawsuits next year against companies that made inadequate disclosure. I just hope they take seriously the interpretive guidance. She says the SEC stands ready to file charges against companies that, after Y2K problems become apparent next year, have demonstrated that they were less than forthcoming in their disclosures. But experts on securities law question whether the SEC has overstepped its statutory authority and whether it will ever take action against companies that don't heed its requests.