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This paper aims to help auditors manage the risk of Foreign Corrupt Practices Act (“FCPA”) violations of the companies that they audit, particularly those with operations in Latin America.

First, the paper describes the relevant provisions of the FCPA. Second, it identifies the common schemes and transactions associated with heightened risk of FCPA liability in Latin America and provides recommendations to minimize this risk. Third, it discusses the responsibilities of auditors under U.S. securities laws and regulations with respect to the FCPA violations of their clients. Finally, it describes the sanctions that auditors could face if they fail to fulfill their responsibilities regarding these FCPA violations. The paper is based on data collected from various documents including laws, cases, accounting and auditing standards, litigation releases, press releases, deferred prosecution agreements, and enforcement actions.

Auditors have a responsibility under Section 10A(a) of the Exchange Act to design procedures that provide reasonable assurances of detecting the FCPA violations of their clients, which are illegal acts with direct and material effects on the financial statements. In addition, auditors have a responsibility under Section 10A(b) of the Exchange Act to report the violations of the FCPA that they detect during the audit to the appropriate level of management. If management does not take the necessary remedial steps, auditors must report FCPA violations to the U.S. Securities and Exchange Commission. In order to reduce their FCPA-related liability and fulfill their responsibilities under U.S. securities laws and accounting standards, auditors should closely scrutinize transactions with a high risk of FCPA liability. An analysis of FCPA cases occurring in Latin America reveals six categories of transactions with heightened FCPA risk.

While there is much literature regarding a company’s compliance with the FCPA, there has not been much literature about the auditor’s responsibilities with respect to the FCPA violations of their clients. This paper attempts to start bridging this gap by providing guidance to auditors regarding their responsibilities to detect and report FCPA violations.

This chapter investigates the nature of the transformation of macroeconomics by focusing on the impact of the Great Depression on economic doctrines. There is no doubt that the Great Depression exerted an enormous influence on economic thought, but the exact nature of its impact should be examined more carefully. In this chapter, I examine the transformation from a perspective which emphasizes the interaction between economic ideas and economic events, and the interaction between theory and policy rather than the development of economic theory. More specifically, I examine the evolution of what became known as macroeconomics after the Depression in terms of an ongoing debate among the “stabilizers” and their critics. I further suggest using four perspectives, or schools of thought, as measures to locate the evolution and transformation; the gold standard mentality, liquidationism, the Treasury view, and the real-bills doctrine. By highlighting these four economic ideas, I argue that what happened during the Great Depression was the retreat of the gold standard mentality, the complete demise of liquidationism and the Treasury view, and the strange survival of the real-bills doctrine. Each of those transformations happened not in response to internal debates in the discipline, but in response to government policies and real-world events.

The Bureau of Economics in the Federal Trade Commission has a three-part role in the Agency and the strength of its functions changed over time depending on the preferences and ideology of the FTC’s leaders, developments in the field of economics, and the tenor of the times. The over-riding current role is to provide well considered, unbiased economic advice regarding antitrust and consumer protection law enforcement cases to the legal staff and the Commission. The second role, which long ago was primary, is to provide reports on investigations of various industries to the public and public officials. This role was more recently called research or “policy R&D”. A third role is to advocate for competition and markets both domestically and internationally. As a practical matter, the provision of economic advice to the FTC and to the legal staff has required that the economists wear “two hats,” helping the legal staff investigate cases and provide evidence to support law enforcement cases while also providing advice to the legal bureaus and to the Commission on which cases to pursue (thus providing “a second set of eyes” to evaluate cases). There is sometimes a tension in those functions because building a case is not the same as evaluating a case. Economists and the Bureau of Economics have provided such services to the FTC for over 100 years proving that a sub-organization can survive while playing roles that sometimes conflict. Such a life is not, however, always easy or fun.

The British North American colonies were the first western economies to rely on legislature-issued paper monies as an important internal media of exchange. This system arose piecemeal. In the absence of banks and treasuries that exchanged paper monies at face value for specie monies on demand, colonial governments experimented with other ways to anchor their paper monies to real values in the economy. These mechanisms included tax-redemption, land-backed loans, sinking funds, interest-bearing notes, and legal tender laws. I assess and explain the structure and performance of these mechanisms. This was monetary experimentation on a grand scale.

In July 2008 the U.S. Securities and Exchange Commission (SEC) published three proposals relating to the use of credit ratings in its rules and forms. The proposals were designed to address concerns that the misuse of credit ratings may have contributed to the current crisis. The SEC sought market feedback regarding the effect the removal of credit rating references may produce on the markets.

This article examines the use of ratings by various market constituents, analyzes the details of the SEC proposals, and reviews the provided feedback. The main finding is that the majority of the market participants opposed the SEC proposals. Fiduciaries and regulated entities are looking to regulators to offer a common measure of risk, stable, accurate and free of conflict of interests.

The scientific correspondence between Harrod and Robertson was initiated by Harrod’s criticism of Robertson’s Banking Policy and the Price Level (1926).⁷ Harrod first wrote on 18 May 1926 (letter 2) raising at once the following “salient point”: Much of your argument depends on the view that justifiable expansions and contractions as defined by you are desirable. Why are they desirable? You give reasons on p. 22 why you think some instability in output desirable. But the reasons mentioned there (and I can’t find any others) don’t seem particularly directed to show that the special form of instability constituted by the so-called “justifiable” expansions and contractions is desirable. They seem to me to show that perhaps some instability, that, presumably, of less degree than we have been accustomed to in the past, is good, but by no means precisely how much is good. Thus, suppose the “hypothetical group member” or “the actual workman” of p. 19 were able to govern output according to their own self interest, there would still, according to the arguments of ch. 2, be some instability. Would not that be enough? Or if you want more, why stop at the “justifiable”? Why not have some of that due to “secondary” causes? It seems to me that you have been led away by purely aesthetic interests to identify that more moderate amount of instability which we really need (as shown on p. 22.) with that which we would get: (i) if secondary causes were removed; and (ii) if control of output stayed where it is now – in the hands of the entrepreneur. I don’t see how you can say to the banks more than “damp down fluctuation a bit, but leave some fluctuation, as that is healthful for the body economic”.He added two notes to his letter, in the first of which he commented upon the four proposed courses of policy outlined by Robertson on pp. 25–26 of his book. In the second note Harrod suggested that Robertson’s calculations in Appendix I to Ch. 5 of Banking Policy assumed the following behaviour of the public: (i) People do not allow for the effect of their withholding on the price level (this is reasonable). (ii) They are ignorant as the future course of inflation (or do nothing to meet it). (iii) On this basis they decide what withholding is necessary to restore H, decide that it would be too much effort to restore it at once, and…spread the restoration over K – 1 days. It so happens that by choosing K – 1 their 2 errors (or failures to take everything into account) cancel each other out, and they do effect the restoration in that time. If K or K – 2 had been chosen, this would not have been so.Harrod further argued that Robertson’s “so-called reasonable assumption of a restoration in K – 1 days is purely arbitrary,” and that “all this reasoning is rendered of doubtful value by the fact that we must suppose an alteration in view as to ‘the appropriate proportion between Real Hoarding and Real Income’ during the process of inflation. Not only will people not replenish H at once, but they may well voluntarily reduce it.”

Studies of Depression-era financial remediation have generally focused on federal deposit insurance and the provision of equity to banks by the Reconstruction Finance Corporation (RFC). This paper broadens the concept of financial remediation to include other programs – RFC lending, federal guarantees of farm and home mortgages, and the elimination of interest on demand deposits – and other intermediaries – savings and loans, mutual savings banks, and life insurance companies. The benefits of remediation or the amounts potentially at risk to the government in these programs are calculated annually and allocated to the various intermediaries. The slow remediation of real estate loans (two-thirds of these intermediaries' loans) needs further study with respect to the slow economic recovery. The paper compares Depression-era remediation with efforts during the 2008–2009 crisis. Today's remediation contrasts with the 1930s in its speed, magnitude relative to GDP or private sector nonfinancial debt, the share of remediation going to nonbanks, and emphasis on securities markets.

This chapter synthesizes the economics, law, and technology of security tokens and security token offerings (STOs). Security tokens are an increasingly important instrument in decentralized finance (DeFi) markets. They are blockchain-based investment contracts that are subject to securities law. Interoperability, fractional ownership, market liquidity, and rapid settlement are the main reasons security tokens are a primary catalyst for digitizing finance. The chapter empirically compares STOs with initial exchange offerings (IEOs) and initial coin offerings (ICOs). STOs take longer and raise more funding. However, controlling for other factors, the amount raised in STOs and IEOs is lower than in utility-token ICOs. These findings suggest an avenue for future research. Moreover, both the law and the technology of security tokens need to address critical challenges related to the competent jurisdiction in multinational activities and blockchain interoperability, scalability, and natural resource degradation.