Is U.S. Law Enforcement Stronger than That of a Developing Country?

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Corporate governance literature usually refers to enforcement superiority to explain the premium that foreign firms enjoy when cross-listing in U.S. stock exchanges. This Article casts doubt on this hypothesis by analyzing two comparative case studies of private and public enforcement actions taken against securities fraud in the United States and in Brazil. The case studies show that U.S. enforcement was superior in terms of private shareholder financial recovery but inferior when it came to public discipline and out-of-pocket liability costs for corporate actors.