The Liability of Clearing Brokers to Public Investors

This blog post is offered, in part, as a primer for members of the judiciary, arbitration panels, and the bar who may be faced, perhaps for the first time, with a claim against a “clearing broker.” Understandingly, the role that clearing brokers play in the securities markets is not well understood by the general public, […]

How Import Competition Contributes to Corporate Tax Avoidance

The past few years have been marked by many tax scandals: LuxLeaks in 2014, SwissLeaks in 2015, Bahamas Leaks and the Panama Papers in 2016, and the Paradise Papers and Malta Files in 2017. Last month, the International Consortium of Investigative Journalists (ICIJ) published the FinCEN Files, and in so doing provided a glimpse into […]

Determination of International Buyout Investments

Since the 1990s, global investment in private equity has increased from nearly $10 billion to well over $100 billion per year. Concurrently, there has also been a shift away from public markets in major economies like the U.S. and U.K. These two developments are likely connected by the trend of small and mid-sized companies staying […]

Agree to Disagree: Within-Syndicate Conflict and Syndicated Loan Contracting

Recent studies show that dual holders—that is, institutions that simultaneously hold equity and debt of the same firm—internalize the shareholder-creditor conflict and lead to incentive alignment between the two parties (Jiang et al., 2010; Chava et al., 2017; Chu, 2018; Anton and Lin, 2020). However, mitigation of the shareholder-creditor conflict comes at the cost of […]

Taming the Megabanks: Why We Need a New Glass-Steagall Act

Banks became major participants in U.S. securities markets twice in the past century – during the 1920s and after the mid-1990s. Both times, banks with “universal banking” powers originated risky loans and packaged them into securities that were sold to investors around the world. Both times, universal banks promoted unsustainable credit booms that led to […]

The Tax Elasticity of Financial Statement Income: Implications for Current Reform Proposals

There has been growing attention among policymakers and the general public to the taxation of multinational corporations (MNCs) in recent years. This reflects widespread concern about the capacity of the international tax regime – which originated in the 1920s – to accommodate recent developments such as the growth of digital services across borders. In particular, […]

FinTech and the COVID-19 Pandemic: Evidence from Electronic Payment Systems

The COVID-19 pandemic has changed many aspects of the way that individuals engage with banking and payment tools, including various FinTech services. There are several reasons why the pandemic might have accelerated the adoption of FinTech and other digital platforms in payments by consumers and financial institutions. The pandemic may have led to an increase […]

A Contextual Methodology for Regulating the Credit Information Sharing System

Since its emergence in December 2019, there have been more than 20 million COVID-19 infections worldwide, with at least five million confirmed cases in the United States (Roser et al., 2020). Individuals and business entities suffered severe loss of revenues and disrupted supply chains due to industry shutdowns and restrictions on movement and commerce. Policymakers […]

The OCC Should Withdraw Its Proposed “True Lender” Rule

The Office of the Comptroller of the Currency (OCC) recently issued a proposed “true lender” rule.[1] The proposed rule would establish a two-part test for determining whether a national bank or federal savings association “makes a loan and is the ‘true lender’ in the context of a partnership between a bank and a third party, […]

Regulating Central Bank Digital Currencies: Towards a Conceptual Framework

At this time, numerous initiatives are attempting to provide citizens with a digital form of central bank money, referred to as Central Bank Digital Currency (CBDC). CBDC promises many benefits for citizens, such as providing a risk-free means of payment, preserving monetary sovereignty in light of the growing usage of private cryptocurrencies, and strengthening the […]