Like Madoff and his financial regulation friends in the US...

But the difference is that the US has harsh punishment and a system that learns from its mistakes. In Germany, bad actors are usually involved with the highest political circles and nothing ever happens. See the "cum ex" scandal, which cost the tax payers something like $36b and Germany just let it continue for years after taking notice.

The U.S. is one of the few countries that actually prosecutes financial fraud. Here in Canada we've quietly become the world's money laundering leader, or at least second only to Switzerland and there's essentially zero resources dedicated to any kind of enforcement.

North Dakota is now the worlds capital for hiding money.

Judging by the variety of answers on this thread alone, I'm going to assume that if random internet commenters all know that a place is the most secure, secret place to do something illegal, it probably isn't really.

The first rule of tax shelters...

How is it better (or worse!) than Delaware? Reporting requirements for Delaware C Corps are pretty lax from what I have seen. I even recall reading somewhere that few Americans were ensnared by the Panama Papers scandal [1] because they could just register in Delaware.

p.s., Sorry any Delaware residents. You live in a very nice state.

[1] https://en.wikipedia.org/wiki/Panama_Papers

You mean the one that nails people driving on interstates with toll booths for driving about 20 miles in the state?

This state should be called the "land of trolls"

North or South Dakota? Have heard a lot about South Dakota trusts, but nothing about North.

When you see Citi 'headquarted' in Sioux Falls you know something is up. ND, SD, NV, AZ, UT, FL, TX--one seldom gets a warm and fuzzy feeling of reassurance from these business addresses.

Banks it makes sense. SD doesn't have usury laws, and multi-state banks can charge interest based on their home state's laws.

As to what the other states get you, I'm not sure.

s/Canada/Vancouver; #or maybe Toronto

Not a lot of money laundering coming through NL or SK

"harsh punishment and a system that learns from its mistakes"

... what?

Late stage capitalism in a nutshell.

The common thread in all of these are post-hoc discoveries of irregularities. In many cases, these are carried over many years and months without being detected. If one needs to address this issue, a near real-time approach would be needed. Otherwise, such operations will continue to take place.

Way too expensive to regulate in real time and the sample size for regulating is pretty low. What you need to do is make the punishment for bad behavior strong enough to minimize fraud. I would like to think most actors are good actors and we take the bad actors and make an example to the rest of the industry what to expect if caught. It will always be a cat and mouse game.

If the chance of getting caught is low, I'm not sure stronger penalties make that much difference. See the drug war for example.

General criminology finds that the certainty of punishment so long as it is non-neglible relative to the rewards is what matters more than the magnitude as most criminals don't think they will get caught unlike others.

It’s almost impossible to do that in real time. The problem is fraudulent activity can often be hidden behind a smokescreen of legitimate behavior, and stratigraphic investments can look overpriced. Apples acquisition of NeXt must have looked all kinds of shady at the time.

This also shows how inefficient government legislation is when the potential risk and impact punishment of being caught is low. These companies and all the people (not only few) should receive a substantial penalty. I think it is was not really sufficient in the VW case. We will see how it is going to be with WD.

But that's when you make most money. Regulators are salaried individual, what's the incentive for them to do their job properly?

Think about if a regulator looks the other way, he is seen as incompetent - many times you'll not be punished for incompetence at work. But this benefits the corporate player and he can offer benefits to the regulator like private jet (for his family/friend use), maybe access to a resort where the regulator's family can stay during vacation or maybe an apartment in some posh locality where the regulator's kid can study abroad.

People are acting in their self interest.

You've salary and ethics Vs luxuries and loyality from the rich man who is unlikely to go bust.

Thing is you can choose to not coperate but that only increases the price and the rich man goes for your boss then you get in trouble as boss is cooperating with them and he may fire you.

I once dated a very rich and powerful lady in Asia and she could solve all problems with just 1 phone call - that was amazing, she new everyone everywhere it felt.

With respect, I do question whether an auditor overlooking financial irregularities is actually acting in their self-interest.

Do you know any regulators?

Yes I know a few guys in customs who are paid to look other way and they use CHA to benefit from such thing (so they aren't directly involved by indirectly involved through CHA) when caught they blame it on people working under them

In most countries customs is a law enforcement agency (exercising the government’s policing power) not a regulatory agency (exercising the government’s policy-making power).

That seems illegal. Who's looking the other way on that?