A Veil of Lemons in Financial Markets

Ojwang’ George Omondi

Abstract


Captains of industry, including large banks such as Goldman sachs, and Deutsche Bank, accountancy firms such as Ernst and Young and Deloitte, and insurance conglomerates such as Lloyds and AIG, have been involved in many of the financial scandals witnessed in industry. Even in those cases where these respected institutions did not play an active role as primary perpetrators, they often played a more facilitating role backstage by turning a blind eye to fraudulent practices from which they could reap profits indirectly. The industry itself has usually responded to revelations of their involvement in financial fraud by suggesting that such fraudulent deals are the works of ' a few bad apples' within the organization. Central to financial scams is the uncontrolled financial deregulation, an influx of relatively unsophisticated investors, increasing complexity in financial market transactions and the veil of secrecy surrounding many financial market activities such as off-balance sheet constructions and the existence of shell companies.

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References


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This work is licensed under a Creative Commons Attribution 4.0 International License.

Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.