Lehman Brothers, Obama and the Case for Corporate Regulation

Abstract

For over two decades, neo-liberal economists, socio-legal academics and politicians argued that deregulation and a laissez faire approach to financial capital and corporations are crucial to economic growth. When the banking crisis began almost three years ago, the international cost of deregulation became clear. Using the case of the Lehman Brothers’ bankruptcy and the dubious and misleading activities of Lehman and accountants Ernst and Young, this chapter argues for a tougher enforcement approach by regulatory bodies as a means of preventing large scale financial fraud and to increase corporate accountability. In view of this, proposals outlined in ‘Financial Regulatory Reform (2010)’, produced by The Department of the Treasury, are also be considered.