Banking on Failure: Cum-Ex and Why and How Banks Game the System

Banking on Failure: Cum-Ex and Why and How Banks Game the System is a sharp, closely argued study of one of the most notorious financial scandals of recent years. Richard S. Collier uses the cum-ex case to show how complex trading structures, tax rules, and settlement systems can interact in ways that leave room for large-scale exploitation.

The mechanics behind the scandal

The book explains the core moving parts carefully: dividend arbitrage, withholding taxes, tax credits, cum-dividend and ex-dividend sales, settlement lags, dividend adjustments, and short selling. Rather than treating cum-ex as an isolated anomaly, Collier breaks it into its component parts and shows how they were synchronized into a repeatable trading strategy.

Why this mattered across Europe

From there, the discussion broadens into the wider consequences of the scheme. The book addresses how the trade spread through banking and market infrastructure, why it proved so difficult for authorities to contain, and what its scale suggests about the vulnerabilities of modern tax systems. The result is a clear account of both the technical structure of cum-ex and the institutional conditions that allowed it to persist.

For readers interested in finance, tax, and regulation

This is an academic and policy-minded work, especially relevant to readers who want to understand financial misconduct, tax abuse, securities settlement, and the deeper incentives that shape banking behavior. It is also useful for anyone studying the relationship between markets and public revenue.

Why it stands out

Collier’s focus is not sensationalism but explanation. He takes a complicated subject and follows it with precision, making the book valuable for anyone who wants a serious account of how a seemingly technical trading practice became a major public controversy.