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Replies to post #2580 on BPZ Res. Inc. (fka BPZRQ)
Levronefullblown
10/06/15 2:50 PM
#2581 RE: Levronefullblown #2580
Tunneling, or tunnelling (see spelling differences), is a colloquial term for a specific kind of financial fraud. It is defined as "the transfer of assets and profits out of firms for the benefit of those who control them".[1] For example, a group of major shareholders or the management of a publicly traded company orders that company to sell off its assets to a second company at unreasonably low prices.
The main conditions enabling such a fraud is weak law against conflict of interests, non-existent legal liability of managers for leading their employer towards bankruptcy, and incompetence of financial authorities.