Twenty years ago, my research exposed one of the biggest corporate scandals in U.S. history: It taught me that fraud is everywhere, just waiting to be revealed

More than 100 public companies were implicated, dozens of executives resigned or faced criminal charges, and billions in earnings had to be restated

I never int to be a whistleblower

I was simply doing what academics are trained to do: ask questions, the data, and let the evidence speak

But what the evidence revealed was staggering: executives at hundreds of companies were manipulating stock option grant dates to enrich their executives at the expense of holders

The practice became known as backdating

Now, on the 20th anniversary of that re, I see troubling parallels emerging in other corners of the financial world

A pattern too precise to be chance My journey into this murky corner of corporate behavior began with a desire to understand how executive compensation influenced firm decisions

While analyzing large datasets of compensation and stock prices, I noticed something peculiar: stock option grants often coincided with recent dips in the company’s price

The pattern was statistically imbable

It was as if executives had a crystal ball, repeatedly receiving options at the most opportune moment

But the truth was more mundane—and more troubling

Companies were retroactively selecting grant dates that coincided with low stock prices, effectively locking in instant, unearned gains

This allowed executives to buy s at a discount while maintaining the illusion that they had to earn the discount by lifting the stock price

The simplicity of the scheme What made the fraud so insidious was its simplicity

Backdating didn’t require complex financial engineering or elaborate cover-ups

It was a quiet manipulation of paperwork—choosing a date in the past when the stock price was low and pretending that was the day the options were granted

That simplicity ly contributed to its spread

There’s evidence that individuals on multiple boards passed along the practice

But even isolated executives and directors could easily conceive the scheme, much someone backdating a check to make it appear they paid a bill on time

Hidden in plain sight What struck me most was that backdating went unnoticed for at least a decade

It was a silent epidemic of opportunism

The option grant data was public

Thousands of participants were involved

Surely some auditors must have seen isolated traces of the fraud

But no one connected the dots

My re, combined with a timely nudge, eventually mpted the SEC to launch targeted investigations

Journalists ed, including a team at The Wall Street Journal with the time, resources, and incentives to pursue the story

Their work earned the paper its first Pulitzer Prize for Public Service

Parallels in other scandals I’ve since seen parallels of backdating in other financial scandals

For example, backdating is not the only fraud that depends on simply picking prices from the past

Bernie Madoff’s infamous Ponzi scheme used fabricated trades based on stale prices

Remarkably, Madoff’s investors accepted these reports for years, despite the implausibility of the returns

Similarly, the mutual fund late-trading scandal allowed favored clients to illegally trade mutual funds late in the evening at stale prices from the end of the trading day

These cases show how much easier it is to perform well when you can reach back in time and choose a favorable moment to act

Today, I worry that similar dynamics may be unfolding in private equity

Many funds report valuations based on internal or third-party estimates shortly after acquiring assets

These valuations often appear inflated—sometimes even acknowledged as such by the firms themselves

Yet these funds are increasingly included in pension portfolios, exposing everyday investors to risks—and potentially fraud—they may not fully understand

The paradox of corporate fraud That’s the paradox of corporate fraud: it’s both obvious and invisible

The data is often there

The patterns are detectable

But with silent perpetrators, the deception persists

What gives me hope is that our tools for detecting fraud are more powerful than ever

We have better data, sharper analytical methods, and a growing community of skeptical citizen watchdogs

Because the next scandal won’t be stopped by regulators alone

It will be stopped by someone who notices a pattern, asks a question, and refuses to look away

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