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Abstract

This research investigates the type of intermediary institutions chosen by the manipulators for their manipulative trading. Univariate and multivariate analyses are performed and three variables having significant effect on the manipulators' choice of intermediary institution for their manipulative trading are found. These variables are being publicly traded, size in terms of total assets, and gross profit margin. Being publicly traded and size are positively; gross profit margin is negatively related to the manipulators' choice of intermediary institution for their manipulative trading. Managers of the intermediary institutions and regulators should be aware of these results and regulators should scrutinize high volume transactions conducted through this type of intermediary institutions more closely.