Financial crime seems horribly complicated, but there are only so many ways that you can con someone out of what's theirs. In fact, there are four. A veteran regulatory economist and market analyst, Dan Davies, has years of experience picking the bones out of some of the most famous frauds of the modern age. Now, he reveals the big picture that emerges from their labyrinths of deceit.
The LIBOR scandal is well known where respectable bankers gave low quotations in the polling process as the idea was to trick the market into believing that the banks were strong. If they had provided the right rates, which were actually higher, then the prevalent fear psychosis would have taken over, given the deep suspicions that were harboured against banks post-financial crisis. Barclays was the big name that was involved in this fraud.
Starting from this example, Mr Davies goes across various kinds of frauds that have been perpetrated, right from raising money for central banks of countries that never existed to the more well-known cases of Ponzi or Madoff. His belief is that fraudsters play on the weaknesses in the system of checks and balances and the audit processes that are meant to supplement the environment of trust. And it is hard to catch these people because crooked businessmen employ the services of crooked auditors, accountants, lawyers and even bankers so that there is a strong circle of fraudulent parties in the ring, which is hard to dislodge, argues the author.
Along the way you will find out how to fake a gold mine with a wedding ring, a file and a shotgun. You will see how close Charles Ponzi, the king of pyramid schemes, came to acquiring his own private navy. You will learn how fraud has shaped the entire development of the modern world economy. And you will discover whether you have what it takes to be a white-collar criminal mastermind, if that is what you want.
About the author
Dan Davies is a former regulatory economist of the Bank of England and analyst for a number of investment banks. His career has seen him tackle all manner of financial crookedness, including the LIBOR and FX scandals, the collapse of Anglo Irish Bank and the Swiss Nazi gold scandal.