We investigate the impact of fraud risk - measured by the probability for earnings overstatements - on a firm's future … stock market performance. Based on an out-of-sample estimation of individual firms' fraud risk, we find that stocks with … higher fraud risk earn significantly lower stock market returns. A long-short trading strategy delivers a statistically …

Supreme Court has called “illicit manipulation of a board's deliberative processes” or “fraud upon the board”). Commission of … fraud on the board is an omnipresent temptation for self-interested controllers, activist stockholders, officers, financial … advisors, and their legal counsel. Fraud can be used to put a company in play, steer a sale process toward a favored bidder …

should remedy and deter tortious misconduct that corrupts board decision-making. Commission of fraud on the board is an … counsel. Fraud can be used to put a company in play, steer a sale process toward a favored bidder, suppress the sale price to … reinterpreted as occasions when courts made tentative or final determinations that a board decision was corrupted by fraud or …

We study how bank monitoring affects corporate fraud in China. Financial We study how bank monitoring affects corporate … fraud in China. Financial misreporting is less prevalent in provinces with more developed banking sectors. A natural … bank monitoring on misreporting fraud. The reduction in fraud after liberalization is greater among clients of foreign …

We develop and test a model linking the duration of financial fraud to information produced by auditors and analysts … and efforts by managers to conceal the fraud. Our empirical results suggest fraud termination is more likely in the …, indicating auditors' observable signals reduce fraud duration. Analyst attention increases the likelihood of fraud termination …

We investigate two under-explored factors in mitigating the risk of corporate fraud and regulatory enforcement against … fraud, namely institutional investors and political connections. The role of institutional investors in the effective … proportion of their shares held by institutional investors have a lower incidence of enforcement actions against corporate fraud …

This paper finds that investors learn from their experience with corporate fraud and financial misconduct and modify … funds that experienced corporate fraud at one of their portfolio firms subsequently chose firms with lower probabilities of … fraud and financial misconduct, compared to otherwise similar funds that did not experience any corporate malfeasance …

associated with a three-fold higher likelihood of corporate fraud and that the association is attenuated for firms with stronger …

This paper examines the effects of controlling shareholders on corporate fraud. Using a sample of Chinese listed firms … for 2004-2019, we find that the absence of an ultimate controlling shareholder increases the risk of corporate fraud. We … that in the absence of controlling shareholders, fraud is mainly conducted by blockholders, and firms with more dispersed …

and consequences of accounting fraud. In particular, we examine whether large audit firms reduce the incidence of … financial statement fraud in China, an emerging market in which auditors face strong government sanctions but low litigation … statement fraud. This effect is stronger for regulated industries, consistent with heavier government monitoring in such …