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Corporate fraud and misconduct : investigative and regulatory priorities

Journal Article


Abstract


  • This article investigates the profile of the companies that have been investigated for corporate fraud and misconduct. Our definition of fraud includes financial statement fraud, market misconduct fraud such as insider trading or false disclosures, and managerial fraud. The particular evidence presented relates to those instances of corporate fraud and misconduct investigated by the Australian corporate regulator, Australian Securities and Investments Commission (ASIC), and relates to sanctions for fraud, misconduct or compliance breaches. Using data compiled from the public announcements in the ASIC reports over the period 2004-2008, we categorise the type of fraud and misconduct breaches ASIC chooses to report and investigate. Once we have identified the types of fraud targeted by ASIC, we examine the specific characteristics of those companies to profile their corporate governance, using the accepted Principles of Good Corporate Governance to develop the governance measures. We find that the investigated companies have some atypical governance weaknesses not present in the representative firm in the wider population. This study makes a contribution to the fraud investigation area by providing comment on a corporate regulator's enforcement priorities and providing descriptive evidence on the profile of the investigated companies.

UOW Authors


  •   Chapple, Larelle (external author)
  •   Tan, David

Publication Date


  • 2012

Citation


  • Chapple, L. & Tan, D. (2012). Corporate fraud and misconduct : investigative and regulatory priorities. New Zealand Business Law Quarterly, 18 (1), 70-92.

Number Of Pages


  • 22

Start Page


  • 70

End Page


  • 92

Volume


  • 18

Issue


  • 1

Place Of Publication


  • New Zealand

Abstract


  • This article investigates the profile of the companies that have been investigated for corporate fraud and misconduct. Our definition of fraud includes financial statement fraud, market misconduct fraud such as insider trading or false disclosures, and managerial fraud. The particular evidence presented relates to those instances of corporate fraud and misconduct investigated by the Australian corporate regulator, Australian Securities and Investments Commission (ASIC), and relates to sanctions for fraud, misconduct or compliance breaches. Using data compiled from the public announcements in the ASIC reports over the period 2004-2008, we categorise the type of fraud and misconduct breaches ASIC chooses to report and investigate. Once we have identified the types of fraud targeted by ASIC, we examine the specific characteristics of those companies to profile their corporate governance, using the accepted Principles of Good Corporate Governance to develop the governance measures. We find that the investigated companies have some atypical governance weaknesses not present in the representative firm in the wider population. This study makes a contribution to the fraud investigation area by providing comment on a corporate regulator's enforcement priorities and providing descriptive evidence on the profile of the investigated companies.

UOW Authors


  •   Chapple, Larelle (external author)
  •   Tan, David

Publication Date


  • 2012

Citation


  • Chapple, L. & Tan, D. (2012). Corporate fraud and misconduct : investigative and regulatory priorities. New Zealand Business Law Quarterly, 18 (1), 70-92.

Number Of Pages


  • 22

Start Page


  • 70

End Page


  • 92

Volume


  • 18

Issue


  • 1

Place Of Publication


  • New Zealand