Almost 3 years after the Federal Reserve introduced monetary measures to artificially support the financial markets and institutions for the greater good of the economy by providing large capital injections to large financial institutions, four investment banks have been investigated by securities regulators, finding that all four consistently misused funds, many banks deteriorated, and that more than half of the banks did not use the funds for the greater economy, and instead used the money to fuel their risky financial bets.
(A) four investment banks have been investigated by securities regulators, finding that all four consistently misused funds, many banks deteriorated, and that more than half the banks did not use
(B) an investigation by securities regulators of four investment banks have found all four consistently misusing funds, that many banks deteriorated, with more than half the banks not using
(C) an investigation of four investment banks by securities regulators has found that all four consistently misused funds, that many banks deteriorated, and that more than half the banks did not use
(D) four investment banks were investigated by securities regulators who found all four misusing funds, with many banks deteriorating, and more than half the banks did not use
(E) an investigation by securities regulators has found that, of four investment banks, all four consistently misused funds, that many banks deteriorated, with more than half the banks not using
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Almost 3 years after the Federal Reserve introduced monetary measures to artificially support the financial markets and institutions for the greater good of the economy by providing large capital injections to large financial institutions, four investment banks have been investigated by securities regulators, finding that all four consistently misused funds, many banks deteriorated, and that more than half of the banks did not use the funds for the greater economy, and instead used the money to fuel their risky financial bets.

First, I will say --- I am not particular impressed with either this question or this source. Notice, for example, the split infinitive in the prompt ("to artificially support") ---- that's something you will never see on the real GMAT.

Some issues in the underlined section of the prompt -----
1) The participle "finding" would, in this construction, apply to the subject "many banks", which does not make sense here.
2) three parallel clauses, and only two of them have "that"
//that all four consistently misused funds,
//many banks deteriorated,
and
//that more than half of the banks did not use
We could have one "that" at the beginning, or a single "that" at the beginning of each clause, but we can't have "that" at the first & third clauses, skipping the second.
(A) is clearly incorrect.

(B) an investigation by securities regulators of four investment banks have found all four consistently misusing funds, that many banks deteriorated, with more than half the banks not using
Failure of parallelism ---- "misusing (participle) .... that many banks deteriorated (full clause) ... banks not using (participle)." This is a disaster. This is incorrect.

(C) an investigation of four investment banks by securities regulators has found that all four consistently misused funds, that many banks deteriorated, and that more than half the banks did not use
No obvious problems. Correct parallelism. This is acceptable.

(D) four investment banks were investigated by securities regulators who found all four misusing funds, with many banks deteriorating, and more than half the banks did not use
Failure of parallelism ----- "all four misusing funds (participle), with many banks deteriorating (prepositional phrase), and .... banks did not use (full clause) ...." Another parallelism disaster. This is incorrect.

(E) an investigation by securities regulators has found that, of four investment banks, all four consistently misused funds, that many banks deteriorated, with more than half the banks not using
Another failure of parallelism --- (that clause) + (that clause) + (prepositional phrase) ---- this is incorrect.

The only acceptable answer possible is (C), the OA.

Does all this make sense?
Mike
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Mike McGarry
Magoosh Test Prep

Dear Atal,
I'm sorry to say, but I think you are splitting hairs too much. If the noun were a concrete object, then yes, we could say --- a concrete object could not find anything: it must be a human. But here, the noun is "an investigation" --- that means, a bunch of people investigating. At no time is the investigation taking place that there aren't real human people doing the investigating. It's an irreducibly human action, so it most certainly can "find" things. Does this make sense?
Mike
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Mike McGarry
Magoosh Test Prep

Dear Atalpanditgmat,
Sure, here are a few examples. First of all, in the OG13,
in SC #10, a "theory holds that..."
in SC #16, a "surge in new home sales ... suggests ...."
in SC #18, "the National Academy of Science has urged ..."
in SC #75, "cities are stressing the arts ..."
Those are a few examples in the OG of larger non-personal nouns taking personal actions.

It would also be perfectly acceptable to talk about ----
... an investigation has found ...
... an exploration of X has revealed ....
... experimentation with X has found ...
... a new understanding of X holds that ...

My friend, I am going to recommend that you make a regular practice of reading a good newspaper, such as the NYT or WSJ, or even better, the Economist Magazine.
http://magoosh.com/gmat/2012/gmat-reading-list/
In any sophisticated news source, you will see an abundance of phrasings just like these.

Does all this make sense?
Mike
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Mike McGarry
Magoosh Test Prep