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Alternative Investment Markets Under Criticism: Reasons To Be Worried? Lessons From Gowex, Aurelio Gurrea-Martinez

Research Collection Yong Pung How School Of Law

The recent financial scandal of Gowex in the Spanish Alternative Investment Market (MAB) has reopened the debate about the dangers of lightly regulated markets and their optimal level of regulation. This article argues that Gowex’s collapse was not a failure of these markets but a failure of the gatekeepers in charge of overseeing Gowex’s activities. Therefore, we propose that regulators should focus on providing mechanisms to encourage gatekeepers to do their work in an effective and credible way. Namely, we propose that regulators should enhance the role and effectiveness of Nominated Advisers, since these players have been created precisely for …