as-if-things-werent-risky-enough

As if things werenÆt risky enough

Sharon McCarthy from risk consulting firm Kroll suggests that, in troubled times, it's not only market risk that companies need to be vigilant about.

By Daniel Inman

November 04, 2008

When times are good and the money is rolling in, banks can be lax about scrutinising their operations. When the profits turn into losses, banks become more introspective, and a whole can of non-compliance worms spills out, says Sharon McCarthy, Hong Kong-based associate managing director at risk consulting company Kroll.

One of the things that can emerge is fraudulent activities. In a recent report, McCarthy shares examples of recent cases she has seen. After the hasty acquisition of a failed financial institution, one party in the transaction discovered that a $7 million loan for an emerging market project had in fact only required $5 million, with the remaining $2 billion going into the...

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