HuffPO-

A recent study confirmed that control fraud was endemic among our most elite financial institutions: Asset Quality Misrepresentation by Financial Intermediaries: Evidence from RMBS Market. Tomasz Piskorski, Amit Seru & James Witkin (February 2013) (“PSW 2013″).

The key conclusion of the study is that control fraud was “pervasive.”

[A]lthough there is substantial heterogeneity across underwriters, a significant degree of misrepresentation exists across all underwriters, which includes the most reputable financial institutions.

Finance scholars are not known for their sense of humor, but the irony of calling the world’s largest and most harmful financial control frauds our “most reputable” banks is quite wondrous. The point the financial scholars make is one Edwin Sutherland emphasized from the beginning when he announced the concept of “white-collar” crime. It is the officers who control seemingly legitimate, elite business organizations that pose unique fraud risks because we are so loath to see them as frauds.

[HUFFINGTONPOST]

Related posts:

1. William K. Black: Holder & Obama’s Propaganda is “Belied by a Troublesome Little Thing Called Facts” New Economic Perspectives- By William K. Black The Obama administration’s...
2. William K. Black: What if the SEC investigated Banks the way it is investigating Mutual Funds? New Economic Prospectives- The Wall Street Journal ran a story...
3. WILLIAM BLACK: 2011 Will Bring More de Facto Decriminalization of Elite Financial Fraud William K. Black Assoc. Professor, Univ. of Missouri, Kansas City;...
4. Bill Black: Fiat Justitia? Breuer fires blanks on elite financial frauds New Economic Perspectives- Beurre blanc is the classic white butter...
5. William K. Black: The Two Documents Everyone Should Read to Better Understand the Crisis H/T Lisa Epstein Written back in early 2009 but still...