WFY’26: When due diligence is not enough

Lessons from Greensill, First Brands, and HPS/Carriox

Recent failures at Greensill Capital, First Brands, and HPS/Carriox have exposed fundamental weaknesses in the way receivables finance and asset-backed lending risks are assessed. In this thought-provoking article, Igor Zaks, CFA, President, Tenzor Ltd, argues that conventional due diligence alone is no longer sufficient. Drawing on these high-profile cases, he identifies recurring structural failures—from inadequate collateral verification to weak governance and ineffective monitoring—and outlines the principles lenders must adopt to build more resilient risk frameworks in an increasingly complex financial landscape.

Below, we provide an excerpt from his outstanding analysis. The whole article is included in the World Factoring Yearbook, most recent edition from 2026 (WFY’26).

In the span of five years, three major failures — Greensill Capital (2021), HPS Investment Partners/Carriox (2024–2025),
and First Brands Group (2025) — have caused losses measurable in the billions and drawn criminal investigators across multiple jurisdictions. Each has been covered as an isolated event. Each has generated its quota of shock and promises of reform.

Examining them together reveals a recurring pattern. The cases are structurally different — a fintech securitising supply chain finance, a leveraged manufacturer using factoring to fund its founder’s enrichment, a private credit fraud built on fabricated telecom invoices — yet the same underlying failures recur. What follows is not a case-by-case retelling. It is a diagnostic, organised around the problems themselves. These were not failures of intelligence or technical capability.
They were failures of independence of judgment, governance discipline, and structural risk design. In each case, due diligence was performed — but it was not positioned to challenge the commercial imperative driving the transaction.

Five systemic weaknesses recur across the three cases.

Problem 1: Accepting representations without independent verification
The most fundamental failure common to all three is this: lenders accepted borrower-provided representations about their collateral without independently confirming them. At Greensill, Credit Suisse managed funds holding USD 10bn of supply chain finance assets. The Swiss Financial Markets Supervisory Authority (FINMA)) found that when critical questions arose, Credit Suisse deployed the very employees responsible for the Greensill relationship to provide the answers, and, in FINMA’s words, they “repeatedly asked Lex Greensill himself and relied on his answers for its own statements” to verify the funds’ positions. The bank used the borrower to verify the borrower.

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To read the whole article and 50 other specialist articles and country market reviews, order World Factoring Yearbook 2026 here.