ADMN 3400H Lecture Notes - Lecture 6: Libor, Minerals Management Service, Regulatory Capture
30 Mar 2020
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Document Summary
Bribery: corruption of individual government officials and civil servants. Regulatory capture: regulatory agency, created to act in the public interest, instead advances the commercial or political concerns of special interest groups that dominate the industry or sector it is charged with regulating, ex. Minerals management service regulatory responsibility for offshore drilling prior to deepwater. Control of agenda (is behaviour of corps, even financial corps, a part of elections in usa) London interbank offered rate (libor): systemic fraud [e. g. london interbank offered rate (libor)] Libor average interest rate calculated through submissions of interest rates by major banks across the world. In 2012, barclays bank revealed significant fraud and collusion by member banks falsely inflating or deflating their rates to profit from trades or give impression were creditworthy than they were. Accountants and auditors: corrupted by consulting contracts. Boards of directors: can be controlled and captured by ceos, possible solution: two-tier boards.
