The arbitrage trade would be repeated over and over until the discrepancy between the ETF and its underlying valuewas so small that there is no profit left from arbitrage.
The villains of the tidal story were the harbor masters who hoarded their information, but in fact that was only a small part of the value they offered.
Certainly, the amounts of money involved in the specific frauds identified at Enron were small compared to the amount of shareholder value that was ultimately destroyed when it plunged into bankruptcy.
Barclays was a leading trader of these sorts of derivatives, and even relatively small moves in the final value of LIBOR could have resulted in daily profits or losses worth millions of dollars.