Time for a fraud risk index? Credible readings could help investors track the risk of corporate fraud
Investments in corporate securities—debt and equity—carry risks, and every investor balances the risk-reward ratio. However, under the current framework, fraud risk is not explicitly assessable. Public funds are an easy target for fraudsters. These include funds invested in debt, equity and other instruments by financial institutions such as banks, insurance companies and pension funds, and funds raised directly from the capital market.
