What legislation was passed due to scandals involving publicly traded corporations such as Enron and WorldCom?

The legislation that was passed in response to the scandals involving publicly traded corporations like Enron and WorldCom is the Sarbanes-Oxley Act (SOX). This act, enacted in 2002, was designed to enhance corporate governance and accountability in financial reporting. It established stricter regulations for all publicly traded companies, aimed at preventing fraudulent activities and protecting investors through increased transparency.

SOX introduced significant reforms, including requirements for enhanced financial disclosures, greater accountability for corporate executives and boards, and the establishment of the Public Company Accounting Oversight Board (PCAOB) to oversee the auditing process. This legislation was essential in restoring public confidence in the securities markets following the high-profile accounting scandals that had exposed significant vulnerabilities in corporate financial practices.

The other options relate to different areas of regulation: the Gramm-Leach-Bliley Act (GLBA) focuses on financial privacy, the Health Insurance Portability and Accountability Act (HIPAA) deals with healthcare privacy and security, and the Family Educational Rights and Privacy Act (FERPA) pertains to educational records. Each of these acts serves distinct purposes and does not address the corporate governance issues that SOX specifically targets.