Deficiencies and Problems II: Cases

Erik Banks

Chapter 5 in Risk Culture, 2012, pp 86-101 from Palgrave Macmillan

Abstract: Abstract To throw some practical light on our discussion from the previous chapter, it will be helpful to examine real-life instances of weak risk culture in financial and non-financial companies and certain quasi-public agencies. This will give us a better appreciation for what can go wrong when a risk culture is ineffective. Some of these cases center on failed risk management processes that led to large, and often surprise, losses; others demonstrate how failed internal controls, internal fraud and misrepresentation also led to losses. In the extreme cases, the problems resulted in financial distress and bankruptcy. Of course, even those situations that did not result in severe financial damage still led to reputational damage. And, since reputation is a valuable asset for any company, although its loss can be considered to be different, it is potentially no less damaging.

Keywords: Hedge Fund; Credit Derivative; Earning Manipulation; Reputational Damage; Risk Appetite (search for similar items in EconPapers)
Date: 2012
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-137-26372-8_5

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DOI: 10.1057/9781137263728_5

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