Ok so several things come to my mind after reading this..#1. Why isn't that manager who actually submitted the documents held personally responsible? At some point the government agencies are going to have to go further and make the individual responsible. Especially like in this case where they clearly knew of wrong doing. I also realize this is the biggest fine ever of this type but will that be enough to deter others or even Scott's from doing similar things again? Probably not, capitalism at it's finest...
If I understand this article correctly the Securities and Exchange Commission established this bounty program in the hopes of catching people who are committing fraud. They hope this bounty program get people who are aware of fraud to act early and expose violations and provide enough evidence to the SEC so they can establishes successful cases against those committing fraud. And the individuals who help build these cases for the SEC by providing the information will be rewarded with money. In my opinion this seems like a good idea because most people will not give up good information unless there is something in it for them and obviously money can make people to a lot of things. Another thing that makes this bounty program more appealing to individuals is that those who “give up the goods” identity is kept confidential so there isn’t fear of the repercussions that other whistleblowers have endured before this program was established. In the article it seems like this strategy is working considering that before this program was put in place they only had two dozen quality tips every year and now it is more along the lines of 2 quality tips per day. Obviously the SEC main goal is to make sure justice is served to those who are committing fraud. I guess all we can do is watch and see how this works out and hopefully people don’t give false statements just to try and get these big payouts.
It appears the New York Stock Exchange was sending market information to banks and investment firms before it was made public. This gave those firms an advantage to make lots of money and manipulate the market. In today’s corporate world this is not unexpected or any surprise. Big business is in business to make as much profit as it possibly can and any way it can in most instances. To manipulate the market at the public’s expense is just “business as usual” for many big corporations. Upon hearing that the NYSE is in bed with big business is also no surprise. The NYSE is a big corporation that makes millions of dollars off of fees and commissions as do the stock traders. If this had been going on since 2008, I see no reason to believe that it would have ever ended if the SEC had not taken notice. I believe that in the opinion of the NYSE, the advantages of making millions of dollars would outweigh any disadvantages they might incur (such as the five million dollar fine).
Corporation’s do commit crimes and sometimes value the dollar more than their customer. This does not mean that customer’s are always smart about what they choose to purchase. This case of customers getting screwed, in my opinion, is not entirely the fault of the corporation. I do not understand how any person could pay for insurance month after month without being sure that the company would not default on the policy. It does require some research, but when you think about how much money we put into insurance it seems like the research would be a good investment. The Sun Life Assurance Company did not have “clear and adequate governance arrangements” which should have clued customers into the fact that they were taking a risk. People need to take some responsibility for when things go downhill. The Sun Life Assurance Company is not innocent either. They should have ensured that they were keeping the customer’s best interest in mind. The transactions should have been approved by the appropriate people and policies should have been followed appropriately. It is surprising that the firm did not have “clear and adequate governance arrangements” in place. Companies have a responsibility to their customers in order to remain in business. Had Sun Life Assurance been reputable and honest they would probably still be operating today. So, I think it is incorrect to attack corporations. They are not alone in their guilt. They would not remain in business if we did not continue to purchase goods and services from them. We support them whenever we buy their product. When working together, consumers are in control of the corporation. The corporation would fail if we decide to boycott them for the things we believe they do wrong. The main example that comes to my mind is where I work. Most of the Starbuck’s garbage is recyclable, but we do not recycle. If the customer’s would put forth the ultimatum “either you recycle, or I go somewhere else,” I know that Starbucks would recycle. So, the guilt moves in a circle. We support the corporation and they continue to do things we consider wrong.
This topic is about the SEC settling the frauds by Chase and Credit Suisse. Misrepresentations regarding the creation and sale of mortgage securities, during the housing market collapse, caused investors to lose money. Chase misstated information about the delinquency status of mortgage loans, which caused investors to lose at least $37 million. Credit Suisse had similarly misstated information on mortgage loans. The SEC charged both of them and distributed the money to harmed investors. I believe that both Chase and Credit Suisse were wrong for purposely misleading investors. The SEC punished both banks and helped the investors recover some of their losses, Even though both banks declined to comment on the allegations, their consent will be viewed as an admission of guilt.
I hate to see that Ben-Artzi’s famil is suffering, because he decided to do the right thing, by becoming a whistleblower. On the other hand, I hope that the Deutsche Bank is held accountable for their illegal activity, and for retaliating against Ben-Artzi , for trying to simply do his job. I would like to see what was the outcome, and if this corporation was actually held accountable.
Although it’s sad that the man who was the whistleblower, have his family and himself suffer, how could he not know that was going to happen.. Not that it’s right but surely he knew something would happen. But he did the right thing by telling. But what I don’t understand is why didn’t the people this man told get in trouble for not taking properly handling this situation? I guess everyone was in on the scheme and no one wanted to be the whistleblower? Is there any deterrence for another bank doing this other than getting caught and paying fines? It doesn’t seem to make any sense. At least someone said something about it. Although sadly he lost his job over it and his family is hurting because of it as well, at least he is getting representation. It’s very sad that this bank would lie about their numbers to customers but at the same time it doesn’t surprise me which is very sad. We should be able to trust our banks and banks holding our money.
This article show a prime example of the consquences of becoming a whistle blower. As we have discussed in our lectures previously that is no protection for the whistle blower, and it is a shame that his family must suffer for him doing the right thing. I believe that there should be a law at the minuium to protect whistle blowers.
Ok so several things come to my mind after reading this..#1. Why isn't that manager who actually submitted the documents held personally responsible? At some point the government agencies are going to have to go further and make the individual responsible. Especially like in this case where they clearly knew of wrong doing. I also realize this is the biggest fine ever of this type but will that be enough to deter others or even Scott's from doing similar things again? Probably not, capitalism at it's finest...
ReplyDeleteIf I understand this article correctly the Securities and Exchange Commission established this bounty program in the hopes of catching people who are committing fraud. They hope this bounty program get people who are aware of fraud to act early and expose violations and provide enough evidence to the SEC so they can establishes successful cases against those committing fraud. And the individuals who help build these cases for the SEC by providing the information will be rewarded with money. In my opinion this seems like a good idea because most people will not give up good information unless there is something in it for them and obviously money can make people to a lot of things. Another thing that makes this bounty program more appealing to individuals is that those who “give up the goods” identity is kept confidential so there isn’t fear of the repercussions that other whistleblowers have endured before this program was established. In the article it seems like this strategy is working considering that before this program was put in place they only had two dozen quality tips every year and now it is more along the lines of 2 quality tips per day. Obviously the SEC main goal is to make sure justice is served to those who are committing fraud. I guess all we can do is watch and see how this works out and hopefully people don’t give false statements just to try and get these big payouts.
ReplyDeleteIt appears the New York Stock Exchange was sending market information to banks and investment firms before it was made public. This gave those firms an advantage to make lots of money and manipulate the market. In today’s corporate world this is not unexpected or any surprise. Big business is in business to make as much profit as it possibly can and any way it can in most instances. To manipulate the market at the public’s expense is just “business as usual” for many big corporations. Upon hearing that the NYSE is in bed with big business is also no surprise. The NYSE is a big corporation that makes millions of dollars off of fees and commissions as do the stock traders. If this had been going on since 2008, I see no reason to believe that it would have ever ended if the SEC had not taken notice. I believe that in the opinion of the NYSE, the advantages of making millions of dollars would outweigh any disadvantages they might incur (such as the five million dollar fine).
ReplyDeleteCorporation’s do commit crimes and sometimes value the dollar more than their customer. This does not mean that customer’s are always smart about what they choose to purchase. This case of customers getting screwed, in my opinion, is not entirely the fault of the corporation. I do not understand how any person could pay for insurance month after month without being sure that the company would not default on the policy. It does require some research, but when you think about how much money we put into insurance it seems like the research would be a good investment. The Sun Life Assurance Company did not have “clear and adequate governance arrangements” which should have clued customers into the fact that they were taking a risk. People need to take some responsibility for when things go downhill.
ReplyDeleteThe Sun Life Assurance Company is not innocent either. They should have ensured that they were keeping the customer’s best interest in mind. The transactions should have been approved by the appropriate people and policies should have been followed appropriately. It is surprising that the firm did not have “clear and adequate governance arrangements” in place. Companies have a responsibility to their customers in order to remain in business. Had Sun Life Assurance been reputable and honest they would probably still be operating today.
So, I think it is incorrect to attack corporations. They are not alone in their guilt. They would not remain in business if we did not continue to purchase goods and services from them. We support them whenever we buy their product. When working together, consumers are in control of the corporation. The corporation would fail if we decide to boycott them for the things we believe they do wrong. The main example that comes to my mind is where I work. Most of the Starbuck’s garbage is recyclable, but we do not recycle. If the customer’s would put forth the ultimatum “either you recycle, or I go somewhere else,” I know that Starbucks would recycle. So, the guilt moves in a circle. We support the corporation and they continue to do things we consider wrong.
This topic is about the SEC settling the frauds by Chase and Credit Suisse. Misrepresentations regarding the creation and sale of mortgage securities, during the housing market collapse, caused investors to lose money. Chase misstated information about the delinquency status of mortgage loans, which caused investors to lose at least $37 million. Credit Suisse had similarly misstated information on mortgage loans. The SEC charged both of them and distributed the money to harmed investors. I believe that both Chase and Credit Suisse were wrong for purposely misleading investors. The SEC punished both banks and helped the investors recover some of their losses, Even though both banks declined to comment on the allegations, their consent will be viewed as an admission of guilt.
ReplyDeleteI hate to see that Ben-Artzi’s famil is suffering, because he decided to do the right thing, by becoming a whistleblower. On the other hand, I hope that the Deutsche Bank is held accountable for their illegal activity, and for retaliating against Ben-Artzi , for trying to simply do his job. I would like to see what was the outcome, and if this corporation was actually held accountable.
ReplyDeleteAlthough it’s sad that the man who was the whistleblower, have his family and himself suffer, how could he not know that was going to happen.. Not that it’s right but surely he knew something would happen. But he did the right thing by telling. But what I don’t understand is why didn’t the people this man told get in trouble for not taking properly handling this situation? I guess everyone was in on the scheme and no one wanted to be the whistleblower? Is there any deterrence for another bank doing this other than getting caught and paying fines? It doesn’t seem to make any sense. At least someone said something about it. Although sadly he lost his job over it and his family is hurting because of it as well, at least he is getting representation. It’s very sad that this bank would lie about their numbers to customers but at the same time it doesn’t surprise me which is very sad. We should be able to trust our banks and banks holding our money.
ReplyDeleteThis article show a prime example of the consquences of becoming a whistle blower. As we have discussed in our lectures previously that is no protection for the whistle blower, and it is a shame that his family must suffer for him doing the right thing. I believe that there should be a law at the minuium to protect whistle blowers.
ReplyDelete