Guardians of trust are themselves wide open to bribery and cooptation.

Evidence

Still more problematic is that almost all these guardianship arrangements are ripe for corruption. Validation and inspection are inherently discretionary activities. And discretion can be compromised. The incentives provided by the targets of trust enforcement to look the other way are often considerable, given the fact that guardians of trust often have the power to abort a profitable illicit scheme or to allow it to flourish by giving it a stamp of approval. (Indeed, some swindlers intentionally try to get inspected, licensed, or certified-they hope, by incompetent or corrupt guardians-since a passing grade confers significant market appeal.) As a result, bribery scandals implicating police officers, government regulators, public and private inspectors, independent testing laboratories, and the like are legendary and their numbers staggering. And the somewhat more subtle problems of cooptation of regulators by the regulated and the conflicts of interest and favoritism in the exercise of discretion that arise from the inevitable revolving door between positions in the public and private sectors are no less frequent or threatening to the institution of trust (Kneier et al. 1976). — Shapiro, Susan P., The Social Control of Impersonal Trust, 116

Categorization

• ADDENDUM: Directly extends the infrastructure theme from ‘Grafting & Growth’: enforcement guardians are another kind of infrastructure whose failure points—bribery, the revolving door—mirror the overlooked failure of root systems and graft unions.
• QUESTION: Worth chasing: are there empirical rates of corruption or capture in modern regulatory agencies, and do ‘independent’ paid-by-the-firm auditors outperform or underperform external regulators?
• XREF: connects to: Guardians of trust are themselves positioned to abuse the trust placed in them. — Shapiro, Susan P., The Social Control of Impersonal Trust, 112; Third-party trust guardians create new opportunities for exploitation. — Shapiro, Susan P., The Social Control of Impersonal Trust, 141; Guardians of trust are themselves trustees requiring ever-higher-order oversight — Shapiro, Susan P., The Social Control of Impersonal Trust, 127 (+2 more)

Related

• Some fraudsters seek certification knowing corrupt inspectors will approve them. (similarity 0.87)
• Guardians of trust are themselves trustees requiring ever-higher-order oversight (similarity 0.84)
• Guardians of trust are themselves positioned to abuse the trust placed in them. (similarity 0.82)
• Third-party trust guardians create new opportunities for exploitation. (similarity 0.82)
• The institutions that police trust are themselves trustees subject to the same agency problems. (similarity 0.80)
• Even honest guardians may not actually deliver the protection principals assume. (similarity 0.80)
• Trusted agents face a dense lattice of institutional surveillance. (similarity 0.80)
• Mechanisms for controlling impersonal trust themselves create new opportunities for abuse (similarity 0.79)
• Gatekeeping mechanisms like licensing and peer review make trustees reproduce themselves in choosing successors. (similarity 0.78)

Broader Connections

• Guardians of trust are themselves positioned to abuse the trust placed in them. #corroborates (0.95) — Shapiro, Susan P., The Social Control of Impersonal Trust, 112
• Third-party trust guardians create new opportunities for exploitation. #expands (0.85) — Shapiro, Susan P., The Social Control of Impersonal Trust, 141
• Some fraudsters seek certification knowing corrupt inspectors will approve them. #exemplifies (0.85) — Shapiro, Susan P., The Social Control of Impersonal Trust, 116
• Guardians of trust are themselves trustees requiring ever-higher-order oversight #expands (0.80) — Shapiro, Susan P., The Social Control of Impersonal Trust, 127
• Fraudsters exploit trust in overseers by forging faux regulators #exemplifies (0.80) — Shapiro, Susan P., The Social Control of Impersonal Trust, 125