So what happens when you fail to properly notify investors of potential risks in Norway? Government regulators revoke your broker's license and you are forced to immediately declare bankruptcy.

On Monday, How the World Works contemplated the plight of Narvik, one of four Norwegian towns unexpectedly caught up in the worldwide subprime credit meltdown via unwise investments in collateralized debt obligations (CDOs) cooked up by Citigroup. The towns, which borrowed against future earnings to invest in the structured finance products, are claiming bad faith on the part of the Norwegian broker, Terra Securities, that marketed Citigroup's concoctions to the towns. One specific gripe: the Norwegian version of the prospectus didn't include the same risk warnings as the English version.

Neither the towns nor the broker come out looking very good in this story, and in the United States, no doubt politicians would still be arguing a year later about what to do. But in Norway, after a speedy investigation by the Financial Supervisory Authority, Terra Securities' license to operate was revoked. The FSA charged that Terra Securities had committed "serious and systematic violations of good practices ... and failed to provide information about significant risks in advance of the townships investments and has offered products to a target group that the products were not suited for."

The company immediately declared bankruptcy and the CEO resigned.

One imagines that other brokers operating in Norway are paying attention. One hopes U.S. regulators are too.