Ethics in financial services.

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Ethics in financial services.

Postby Taylor Larimore » Tue Jul 10, 2012 4:45 pm

Bogleheads:

A recent survey reminds us that Boglehead investors need to be skeptical when dealing with Wall Street professionals.

Nearly one-fourth of financial services professionals feel it’s at least sometimes necessary to do illegal or unethical things to be successful, and many are motivated to do so by fat bonuses and other compensation. That’s according to a new survey of 500 U.S. and British fund managers, bankers, asset managers and other financial services professionals.

Many on Wall Street Think Cheating Breeds Success

It is encouraging to learn that three-fourths of financial services professionals try to do the right thing.

Best wishes.
Taylor
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Re: Ethics in financial services.

Postby azanon » Tue Jul 10, 2012 4:49 pm

"IF" i were an unethical financial service planner, there is no way I would say that I was unethical on a survey. Why take the risk?

Yeah that would be encouraging, if it were logical to believe it.
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Re: Ethics in financial services.

Postby livesoft » Tue Jul 10, 2012 4:53 pm

Interesting, because it appears that financial services professionals are more ethically than college students and even the general population.
It's all about short-term opportunistic rebalancing due to a short-term change in one's asset allocation, uh, I mean opportunistic rebalancing, uh I mean rebalancing, uh I mean market timing.
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Re: Ethics in financial services.

Postby ResNullius » Tue Jul 10, 2012 5:08 pm

Taylor Larimore wrote:Bogleheads:

A recent survey reminds us that Boglehead investors need to be skeptical when dealing with Wall Street professionals.

Nearly one-fourth of financial services professionals feel it’s at least sometimes necessary to do illegal or unethical things to be successful, and many are motivated to do so by fat bonuses and other compensation. That’s according to a new survey of 500 U.S. and British fund managers, bankers, asset managers and other financial services professionals.

Many on Wall Street Think Cheating Breeds Success

It is encouraging to learn that three-fourths of financial services professionals try to do the right thing.

Best wishes.
Taylor

Taylor, do you really think that most cheaters are willing to acknowledge that they cheat? I don't think so.
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Re: Ethics in financial services.

Postby VictoriaF » Tue Jul 10, 2012 6:59 pm

Would not cheaters cheat on the survey?

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Cheaters

Postby Taylor Larimore » Tue Jul 10, 2012 7:58 pm

Taylor, do you really think that most cheaters are willing to acknowledge that they cheat? I don't think so.


Res:

You're right. I've learned that the best cheaters work hard to appear the most honest. Bernie Madoff, former chairman of NASDQ, is a good example.

Best wishes.
Taylor
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Re: Ethics in financial services.

Postby Grt2bOutdoors » Tue Jul 10, 2012 8:58 pm

Those who have the most to gain are usually the ones making the "stretch" of laws, regulations and ethical behavior.
Typical candidates are CEOs, front-line managers in line to succeed the CEO, CFO's, traders, investment "advisers". Also included are research analysts who "tip - purposely like the Gupta case with Raj Ramaratan or inadvertently with "diarreha of the mouth syndrome" :oops: Special mention to include advisers to management of companies - management consultants, M&A desks (yeah, yeah, confidentiality agreements signed - see above on "tipping"), certain accountants and attorneys who go for the "stretch" and only serve to extend the unethical behavior - Enron, Worldcom, need we say more?

The most ethical are those who are "green" and haven't been turned to the "dark side", low-level employees such as back-office support workers, most operations folks where the price of failure is steep - job loss. Compare that to those of the above who usually get nothing more than a slap on the wrist and golden parachutes to float away to the Riveriera. After the last 5 years, not one has seen jail time. Ethics, what is ethics? Those who have a Libor based loan - take a look, why wuuld you trust the Brits to set your rate? Heck, they could call it the USibor - still wouldn't trust it. Trillions of debt, based on funny numbers. If I were an attorney, I'd be salivating. :moneybag

Management never took note of this "It can take an eternity to earn someone's trust, it takes less than 5 minutes to lose it permanently!!!!! :annoyed
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Re: Cheaters

Postby Grt2bOutdoors » Tue Jul 10, 2012 9:02 pm

Taylor Larimore wrote:
Taylor, do you really think that most cheaters are willing to acknowledge that they cheat? I don't think so.


Res:

You're right. I've learned that the best cheaters work hard to appear the most honest. Bernie Madoff, former chairman of NASDQ, is a good example.

Best wishes.
Taylor


In NY, usually when there is a swindle, some shake their heads and say "they would never do it to our own kind". Madoff shattered that myth - he was an equal opportunity scam artist. No one will watch over your money - better than you can. No one. If it sounds too good to be true, then turn around and run!
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Re: Ethics in financial services.

Postby Fallible » Tue Jul 10, 2012 11:24 pm

It's an interesting study, but perhaps a bit self-serving? Here's a comment on the study from the firm that conducted it, Labaton Sucharow (boldface mine):

"Chris Keller, partner and head of case development at Labaton Sucharow commented: "It is shocking that four years after the global economic crisis began there continues to be a fundamental lack of integrity in the financial services industry. For more than 50 years, Labaton Sucharow has been on the forefront of corporate governance reform. Given the results of this survey, our work is more important than ever."

Link to the study:

http://www.labaton.com/en/about/press/L ... survey.cfm
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Re: Ethics in financial services.

Postby FriedSquirrel » Wed Jul 11, 2012 11:23 am

Taylor Larimore wrote:Bogleheads:

A recent survey reminds us that Boglehead investors need to be skeptical when dealing with Wall Street professionals.

Nearly one-fourth of financial services professionals feel it’s at least sometimes necessary to do illegal or unethical things to be successful, and many are motivated to do so by fat bonuses and other compensation. That’s according to a new survey of 500 U.S. and British fund managers, bankers, asset managers and other financial services professionals.

Many on Wall Street Think Cheating Breeds Success

It is encouraging to learn that three-fourths of financial services professionals try to do the right thing.

Best wishes.
Taylor

Whoa don't get carried away here.
There a difference between feeling that it is necessarily to do something illegal/unethical and actually being willing to do it. Moreover, half the time its a justification or an admission of guilty, but rather an excuse for poor performance
I have experience with this in three places, water polo, school, and a finance related internship. But college has the best examples:
The "the only reason I am not succeeding is because I am not cheating." . If I had a nickle for every time someone said being "all natural" is the only reason they suck at trending water I wouldnt need to worry about investing :)
The same goes for people who say they dont get an A because their ethics are so high and mighty.
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Re: Ethics in financial services.

Postby Grt2bOutdoors » Wed Jul 11, 2012 11:30 am

FriedSquirrel wrote:
Taylor Larimore wrote:Bogleheads:

A recent survey reminds us that Boglehead investors need to be skeptical when dealing with Wall Street professionals.

Nearly one-fourth of financial services professionals feel it’s at least sometimes necessary to do illegal or unethical things to be successful, and many are motivated to do so by fat bonuses and other compensation. That’s according to a new survey of 500 U.S. and British fund managers, bankers, asset managers and other financial services professionals.

Many on Wall Street Think Cheating Breeds Success

It is encouraging to learn that three-fourths of financial services professionals try to do the right thing.

Best wishes.
Taylor

[quote]

If I had a nickle for every time someone said being "all natural" is the only reason they suck at trending water I wouldnt need to worry about investing :)
[quote]

You meant pickle, right? Ni with an atomic weight of 59 - part of the periodic table, is spelled "Nickel" as in the metal. Is "nickle" a new element:?:
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Re: Ethics in financial services.

Postby dhodson » Wed Jul 11, 2012 11:39 am

there are two big problems in the industry....

pushing products advisors dont really understand. this seems to be common for new advisors. they get their education from companies that push crap and when thats 99% of the new agents education, they make wrong conclusions.

pushing products advisors know arent the best option but they rationalize it some way that makes it okay to do so. this seems to be more common with the advisors who have been around the block a few times.

it shouldnt be a surprise that people think they would make more money or do better if they did things that werent ethical (assuming they can get away with it). Isnt that true for all industries?
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Re: Ethics in financial services.

Postby FriedSquirrel » Wed Jul 11, 2012 11:40 am

GRT2BOUTDOORS wrote:
FriedSquirrel wrote:
Taylor Larimore wrote:Bogleheads:

A recent survey reminds us that Boglehead investors need to be skeptical when dealing with Wall Street professionals.

Nearly one-fourth of financial services professionals feel it’s at least sometimes necessary to do illegal or unethical things to be successful, and many are motivated to do so by fat bonuses and other compensation. That’s according to a new survey of 500 U.S. and British fund managers, bankers, asset managers and other financial services professionals.

Many on Wall Street Think Cheating Breeds Success

It is encouraging to learn that three-fourths of financial services professionals try to do the right thing.

Best wishes.
Taylor


If I had a nickle for every time someone said being "all natural" is the only reason they suck at trending water I wouldnt need to worry about investing :)

You meant pickle, right? Ni with an atomic weight of 59 - part of the periodic table, is spelled "Nickel" as in the metal. Is "nickle" a new element:?:

If I had a nickel for every smart-ass on the internet....
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