The growth of financial conglomerates, offering a range of services hitherto unprecedented, has caused problems for regulators. While conglomerates bring with them many economic benefits (diversification of risk, economies of scope, etc), they also impose costs (systemic risk and conflict of interest abuses). This book explores ways in which regulators can ensure that the regulation imposed is sufficiently strong to eradicate these abuses, but at the same time
sufficiently flexible to allow the benefits of conglomeration to be secured. The Chinese WallDSa regulatory mechanism aimed at stemming the flow of information from one department in a firm to another, and reconciling conflicts of interest more generallyDSis singled out for special
treatment. The legal position of the device, which has become all the more important in the wake of the recent Law Commission inquiry into the relationship between the Financial Services Act 1986 (and the rules made under it) and the general law, is considered in detail. The author argues that an effective Chinese Wall will, in most cases, be legally sufficient to absolve a firm from potential liability at general law, but that there are situations where Chinese Walls are not satisfactory.
Here the conglomerate will have to suffer the commercial disadvantages of being a fiduciary by adopting a different, albeit more restrictive, regulatory option.
`The book is a detailed and valuable description of a new and rapidly evolving field.'
The Economic Journal
`Timely ... a very thoughtful and coherently argued contribution to regulating conflicts of interest and duty in financial markets.
Times Higher Education Supplement
`Liberally laced with references to UK, US and EC legislation and case law, it offers practical advice, as well as legal authority.
`The author cannot, of course, solve this fundamental problem, but his book provides a lucid and detailed analysis of the main issues, and will be required reading in compliance departments.
International Corporate Law
`a timely subject for scholarly analysis. The book will be of interest to American corporate and banking law professors
Bimonthly Review of Law Books
`The book is a detailed and valuable description of a new and rapidly evolving field.
Cliff Pratten, The Economic Journal, Vol. 105, No. 428, January 1995
|Table of Cases||p. xi|
|Table of Statutes||p. xvii|
|Big Bang and Conflicts of Interest and Duty||p. 18|
|Insider Dealing: The Nature of the Problem||p. 41|
|Regulatory Approaches to Insider Dealing in the UK and the USA||p. 63|
|The Chinese Wall||p. 122|
|The Chinese Wall at General Law||p. 135|
|Legislative and Regulatory Approval of Chinese Walls in the USA and the UK||p. 171|
|The Chinese Wall: A Policy Analysis||p. 201|
|Summary and Conclusion||p. 235|
|Schedule 8: Principles Applicable to Designated Agency's Legislative Provisions||p. 255|
|Merrill Lynch's Statement of Policy||p. 257|
|Table of Contents provided by Syndetics. All Rights Reserved.|
Number Of Pages: 302
Published: 5th August 1993
Publisher: Oxford University Press
Country of Publication: GB
Dimensions (cm): 24.2 x 16.2
Weight (kg): 0.64