Doing Business in China: Securities Fraud

Jim O'Toole, senior fellow in business ethics, Markkula Center for Applied Ethics, interviews Carson Block, research director, Muddywaters, (a company whose name is taken from Chinese proverb - "Muddywaters makes it easy to catch fish.") Block handles fraudulent companies and investigations, and his business focuses primarily on Chinese companies doing business in the U.S. His business model -- not without controversy-- is to short sell company stock for businesses on the brink. The company's reports and research are released to the public. Many companies, including those in China, can appear too good to be true, and they often are. On the other hand, investors need to take responsibility for their investments.