That’s the title of an insightful article on financial crime just posted on NYU’s Compliance and Enforcement blog.  In it author Arun Maheshwar, Executive Director-Head of Model Risk Control, Legal and Compliance at Morgan Stanley, uses the conclusions of numerous enforcement actions across multiple American and foreign jurisdictions to explain why so many organizations private and public are failing to curb employees’ fraud and corruption.

The article is also one more reason why Compliance and Enforcement, sponsored by NYU Law’s Program on Corporate Compliance and Enforcement, is essential reading for corruption fighters.

To whet GAB readers appetite to click on this link to Maheshwar’s post, excerpts appear below.

“Financial institutions have invested billions of dollars in advanced compliance technology. . . . Yet despite this unprecedented investment, enforcement actions continue to rise in both frequency and severity. . . .

“Across the United States, United Kingdom, and European Union, regulatory findings repeatedly identify the same root causes: unclear accountability, weak escalation, ineffective oversight, fragmented ownership, superficial risk assessments, misaligned incentives, and leadership cultures that treat compliance as a regulatory obligation rather than a core control function. . . .

“Financial crime is a leadership problem. It reflects the values an institution prioritizes, the trade-offs management is willing to make, the incentives that drive behavior, and the accountability structures that shape decision-making.”