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dc.contributor.authorRajapakse, Pelma
dc.contributor.authorMalaba, Nothando
dc.date.accessioned2019-03-20T02:14:49Z
dc.date.available2019-03-20T02:14:49Z
dc.date.issued2015
dc.identifier.issn0832-8722
dc.identifier.urihttp://hdl.handle.net/10072/125276
dc.description.abstractThis paper analyses the organisational and regulatory structures, policies and laws of the funds management industry and their effectiveness in the prevention of fraud. The allocation of legal liability between the various entities within fund management corporate structures reveals that in practice, the fund managers use offshore hedge funds to reduce legal liability. Investing in offshore funds exposes retail investors to regulatory risks due to the less rigorous regulatory regimes and the difficulty of recovering funds from certain jurisdictions in the event of fraud, misconduct or the failure of a fund. The specific cases of fund management fraud in Australia, Canada, the United Kingdom and Unites States were examined in order to analyse how the fraud occurred, how the fraud was uncovered and the effectiveness of the regulatory arrangements in detecting and sanctioning the specific instances of fraud. This study identified several fraudulent practices such as operating outside investment guidelines, misleading public documents, inconsistent asset valuations and poor corporate governance. Finally, this study proposes reforms to the organisational and regulatory structures of the funds management industry in Australia by drawing on policy considerations and examples of successful reforms that have helped to minimise or prevent fraud in other jurisdictions. These reforms include a strict approach to penalties imposed on those responsible for the fraud, full disclosure of details of structure and risks involved in offshore funds management to alert investors and regulators, ensuring independence and robust investigations to ensure the integrity of the compliance role of auditors and custodians, improving collaboration between industry professionals and regulators, re-characterisation of retail and sophisticated investors in the context of offshore investments by superannuation funds, and a tighter regulatory oversight for limiting fraudulent conduct in the market.
dc.description.peerreviewedYes
dc.languageEnglish
dc.language.isoeng
dc.publisherCarswell
dc.publisher.urihttps://store.thomsonreuters.ca/product-detail/banking-and-finance-law-review/
dc.relation.ispartofpagefrom53
dc.relation.ispartofpageto88
dc.relation.ispartofissue1
dc.relation.ispartofjournalBanking and Finance Law Review
dc.relation.ispartofvolume31
dc.subject.fieldofresearchCorporations and Associations Law
dc.subject.fieldofresearchInvestment and Risk Management
dc.subject.fieldofresearchLaw
dc.subject.fieldofresearchcode180109
dc.subject.fieldofresearchcode150205
dc.subject.fieldofresearchcode1801
dc.titleMinimising Exposure to Fund Management Fraud in Australia
dc.typeJournal article
dc.type.descriptionC1 - Articles
dc.type.codeC - Journal Articles
dc.description.versionVersion of Record (VoR)
gro.facultyGriffith Business School, Department of Accounting, Finance and Economics
gro.rights.copyrightThis publication is copyright. Other than for the purposes of and subject to the conditions prescribed under the Copyright Act 1968 (Cth), no part of it may in any form or by any means (electronic, mechanical, microcopying, photocopying, recording or otherwise) be reproduced, stored in a retrieval system or transmitted without prior written permission. Enquiries should be addressed to Thomson Reuters (Professional) Australia Limited.
gro.hasfulltextFull Text
gro.griffith.authorRajapakse, Pelma J.


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