Chinese Wall

The term Chinese wall refers to an important barrier within a financial institution for preventing exchange or leakage of important information that might cause conflict of interest. For example, a Chinese wall may exist for separating investors from persons who have access to undisclosed information that might have an influence on the decisions made by the investors. Even corporate financial departments and firms dealing in large accountancy implement Chinese wall. The main purpose of a Chinese wall is to ensure that the firms are safeguarding their private information and to prevent improper or illegal trading. Its existence is very crucial for any firm, particularly firms dealing in multiservice for maintaining confidentiality of the clients’ information. But in recent years, scandals like the Wall Street have made people doubt the existence and importance of a Chinese wall. Some high executives of reputed firms have leaked inside information for their own purpose and benefit.

Ads by Google

Edited and Updated 31st May 2014

You can leave a response, or trackback from your own site.

Leave a Reply

You must be logged in to post a comment.

Powered by WordPress