Listing Standards and Fraud

Managerial and Decision Economics, Forthcoming

47 Pages Posted: 31 Mar 2013

See all articles by Douglas J. Cumming

Douglas J. Cumming

Florida Atlantic University

Sofia Johan

Florida Atlantic University - Finance; University of Aberdeen; Tilburg Law and Economics Center (TILEC)

Date Written: March 31, 2013


Statistics reporting litigated cases of fraud on an exchange-by-exchange basis are not readily available to investors. This paper introduces data from three countries with multiple exchanges operating under different listing standards – Canada, the United Kingdom and the United States – to show litigated cases of fraud significantly vary by country, and the different exchanges within the country. Comparisons are also made to Brazil, China and Germany to assess out-of-sample inferences. The data examined suggest there are significant differences in the nature of observed fraud across exchanges within the United States; by contrast, outside the United States there appears to be a comparative lack of enforcement. The data also suggest policy implications for the ways in which fraud should ideally be reported to improve investor knowledge, market transparency and market quality.

Keywords: Corporate fraud, Exchange listing standards, Securities commissions, NYSE, NASDAQ, TSX, TSXV, LSE, AIM, PinkSheets

JEL Classification: G32, J33

Suggested Citation

Cumming, Douglas J. and Johan, Sofia A., Listing Standards and Fraud (March 31, 2013). Managerial and Decision Economics, Forthcoming, Available at SSRN:

Douglas J. Cumming (Contact Author)

Florida Atlantic University ( email )

777 Glades Rd
Boca Raton, FL 33431
United States


Sofia A. Johan

Florida Atlantic University - Finance ( email )

777 Glades Rd
Boca Raton, FL 33431
United States

University of Aberdeen ( email )

Dunbar Street
Aberdeen, Scotland AB24 3QY
United Kingdom

Tilburg Law and Economics Center (TILEC) ( email )

Warandelaan 2
Tilburg, 5000 LE

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