The untapped potential of alternative markets

Abstract

The market had long expected this moment. When trading closed on 4 January 2005, however, TV Azteca’s stock price had dropped more than 9 per cent after a scrambled selling rush on the New York Stock Exchange.1 On that day the Securities and Exchange Commission filed fraud charges against several of the firm’s top officers, including Ricardo Salinas, chairman of the board and its controlling shareholder.2 TV Azteca, a Mexican company that cross-listed into the USA through an ADR programme, had attracted the attention of American regulatory authorities ever since 2003, when the company’s legal counsel blew the whistle on multiple violations of the Securities Exchange Act of 1934.3 The complaint brought by the SEC argued that Ricardo Salinas had profited illegally from transactions carried out between TV Azteca and a corporation that he secretly controlled.4 Mr Salinas, the complaint asserted, reaped a total payoff...