Misconduct Synergies

70 Pages Posted: 14 Oct 2021 Last revised: 29 May 2024

See all articles by Emmanuel Yimfor

Emmanuel Yimfor

Columbia Business School

Heather Tookes

Yale University - Yale School of Management; Yale University - International Center for Finance

Date Written: October 13, 2021


Do corporate control transactions discipline the labor force? Consistent with synergies, new disclosures of employee misconduct in the investment advisory industry drop by between 17 and 22 percent following mergers. Both targets and acquirers have better pre-merger misconduct records than the industry’s average firm and, within the subsample of merging firms, there is assortative matching on misconduct. Merger events facilitate further reductions in misconduct through separations of target firm employees with high misconduct. Many of these employees remain in the industry, suggesting that consolidation plays an important role in the redistribution of misconduct across firms.

Keywords: Investment Advisers, M&A, Synergies, Broker Misconduct, BrokerCheck

JEL Classification: G24, G30, G34, M14

Suggested Citation

Yimfor, Emmanuel and Tookes, Heather, Misconduct Synergies (October 13, 2021). Available at SSRN: https://ssrn.com/abstract=3942188 or http://dx.doi.org/10.2139/ssrn.3942188

Emmanuel Yimfor (Contact Author)

Columbia Business School ( email )

3022 Broadway
New York, NY 10027
United States

Heather Tookes

Yale University - Yale School of Management ( email )

135 Prospect Street
P.O. Box 208200
New Haven, CT 06520-8200
United States

Yale University - International Center for Finance ( email )

Box 208200
New Haven, CT 06520
United States

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