At the beginning of the 21th century, many financial scandals have occurred in the US market and abroad. Many internal and external factors have contributed to the failure of the global financial system. One important issue highlighted was the massive use of Special Purpose Entities (SPEs) or Variable Interest Entities (VIEs) by the company ENRON in 2001 and many other companies coupled with the mortgage “subprime”  crise Lehmon brothers financials group 2008.

Required:
1. Explain clearly how the use of unconsolidated SPE has contributed to the occurrence of the financial scandals in the earlier 2000th and how the consolidation process reveals such failure of the financial system.    
2. Use a  figure to explain the process of securitization through unconsolidated SPEs.