The Catholic University of America




Financial Regulation Through the Eyes of Tinseltown

It’s hardly a secret that Hollywood’s take on American culture and history is enormously influential in how the nation views itself.

For many moviegoers, the big screen’s depiction of practically any event amounts to the final word about it.
All the more reason to set the record straight regarding financial regulation, movie-style, says Catholic University law school professor David Lipton, director of the school’s Securities Law Program.
Lipton moderated and participated in a live webcast “Silver Screen: How Films Shape Public Perception of Financial Regulation,” sponsored by the SEC Historical Society on Nov. 1, 2011.    
The broadcast incorporated a number of clips from such films as Being There, Boiler Room, Fletch, The Godfather (Part 2), The Other Guys, Rogue Trader, Too Big to Fail and Wall Street to demonstrate the cinema’s influence on the public’s image of the capital markets, what people recognize as financial fraud, and what they expect from regulators.
“Hollywood has been at this for a while,” said Lipton, noting that the first film to reference securities regulation was released in 1914. “They have a routine. To portray the misdeed, you need to make it cinematic. The accuracy of the misdeed seems less important.”
Along with two presenters on the webcast, J. Bradley Bennett, director of enforcement at FINRA; and John Reed Stark, managing director and general counsel with Stroz Friedberg LLC, Lipton summarized the formula: temptation, followed by misdeed, followed by hesitation or remorse on the part of the evil-doer.
The key is to get audiences to empathize, at least to a point, with the scoundrels and their financial shenanigans, said Lipton.
“Were the character a heartless Scarface, we could walk away and say, ‘well, I would never do that.’ But when we see that character has a conscience, we say ‘that could be me doing these bad things,’” he said.
Lipton predicted that the first major film about convicted fraudster Bernard Madoff would portray him as a reasonable man led astray by many factors.
Time will soon tell. It was reported on Nov. 7 that Robert De Niro has agreed to star as Madoff in the first major film about the man who swindled investors out of an estimated $50 billion.    

The SEC Historical Society is a private organization with no connection to the Securities and Exchange Commission.