Initial Public Offerings
Initial Public Offerings
The initial public offering (IPO) process is closely scrutinized by exchanges and regulators, but this does not exclude the development of various misconducts and frauds. The emergence of new financial hubs mainly in Asia changed the global balance of capital flows and opened up new opportunities for companies looking to go public but also created more uncertainty in the process.
The definition of misconduct concerning IPOs depends on the time when they occur and can be either pre-IPO frauds or post-IPO frauds. In addition, the misrepresentation of the value or activity of the underlying firm is the main driver of litigations. Companies incorporated offshore and listed on emerging country’s exchanges have a risk of money laundering.