Wall St. Fraud and Fiduciary Responsibilities: Can Jail Time Serve as an Adequate Deterrent for Willful Violations?

Testimony to the United States Senate, Committee on the Judiciary, Subcommittee on Crime and Drugs, May 4, 2010

32 Pages Posted: 16 May 2010  

William K. Black

University of Missouri at Kansas City - School of Law

Date Written: May 4, 2010

Abstract

The answer to the question posed by the title of this hearing is: only prison sentences can deter the violations that caused the debacle. We should, however, never rely solely on prosecutions to constrain crimes. The criminal justice system needs to work with regulation not only to make regulation more effective, but also to prevent “private market discipline” from becoming a “criminogenic” oxymoron. To understand the vital role that the criminal justice system must play if we are to avoid the recurrent, intensifying financial crises that have beset this and many other nations for nearly three decades we must begin by understanding the epidemics of “control fraud” that are driving these crises.

Keywords: Regulation, banking fraud, corruption, criminology, white collar crime, mortgage fraud, officer and director liability

JEL Classification: G21, G23, G24, G28, K12, K22, K23, K42

Suggested Citation

Black, William K., Wall St. Fraud and Fiduciary Responsibilities: Can Jail Time Serve as an Adequate Deterrent for Willful Violations? (May 4, 2010). Testimony to the United States Senate, Committee on the Judiciary, Subcommittee on Crime and Drugs, May 4, 2010. Available at SSRN: https://ssrn.com/abstract=1607045 or http://dx.doi.org/10.2139/ssrn.1607045

William K. Black (Contact Author)

University of Missouri at Kansas City - School of Law ( email )

5100 Rockhill Road
Kansas City, MO 64110-2499
United States

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