trust

Freddie Mac’s Conflict of Interest and the Betrayal Of The American Homeowner

/ Jack Marshall / 7 Comments

Possible, but expensive.

Though the political implications of this disturbing story, which broke today on NPR, are wide-ranging, this isn’t a political blog.  I will avoid the temptation  to wade into them. That’s fine: the ethical implications are bad enough.

Freddie Mac, the taxpayer-owned mortgage giant, has been doing a Goldman Sachs, betting against the very homeowners it is pledged to serve by making multi-billion-dollar investments that will profit Freddie Mac only if homeowners can’t get out of  expensive mortgages with interest rates well above current rates. Of course, Freddie Mac’s job is supposedly to do the opposite…to help homeowners find cheaper, fairer mortgages. And we were told, by the Obama Administration, that this what it was working to do.

This is called a conflict of interest. And since Freddie Mac, along with its cousin Fannie Mae, is owned by U.S. taxpayers, this is also a massive breach of trust by the Federal government. Freddie and Fannie were bailed out in 2008. The companies insure most home loans in the United States, making banks able to lend at lower risk, and the companies’ rules determine whether homeowners can get refinanced and on what terms. Now we know that Freddie Mac, at least, profits when they fail.  Continue reading →

Incomprehensible Nevada Justice For A Sexual Predator

/ Jack Marshall / 51 Comments

Pop quiz: Can you guess the sentence for this criminal?

Hey! Let's show some compassion for these sexual predators, people!

Bethyl Shepherd, a 35-year old high school teacher,was

  • convicted of having various forms of sexual relations with seven of her male students. In addition…
  • The boys ranged were as young as 15.

She got 60 days in jail, with the rest suspended.

I detect in the country a progressive deterioration of rational attitudes toward official punishment, and this case is an unnerving example. The news story makes it clear that everyone, including prosecutors and the parents of the boys, wanted leniency for Shepherd, and no jail time. The judge rejected their misguided pleas, but just barely.

Why so little punishment? Well, this is Nevada, where the attitude toward dubious sexual relationships is uniquely tolerant. Nevertheless, Shepherd is a sexual predator who exploited the trust of students and their parents for her own sexual gratification. This was not one foolish teacher-student crush, as in other cases that have sent teachers like Mary Kay Le Tourneau into prison for long periods. It appears that much of the sympathy for Shepherd stemmed from defense testimony that she was bi-polar and that this affected her judgment (let’s see how far Jerry Sandusky gets with that strategy) and the fact that her life has spun out of control as a result of her arrest, as she has lost her job, her career, her husband, her children, and has had to sell her car. Continue reading →

As News Media Sinks To New Ethics Lows, Some Friendly—And Urgent— Advice

/ Jack Marshall / 11 Comments

One of many news story warning labels devised by Tom Scott (http://www.tomscott.com/warnings/)

The profession of journalism has now sunk to a point of incompetence and untrustworthiness that constitutes a serious threat, not only to itself, but also to the United States, which must have honest and reliable news sources to function and thrive. As currently constructed, the profession of journalism does not possess the tools or the will to address its crisis. Two recent examples should suffice.

The Saturday before Joe Paterno died, a tweet from a Penn State student-run website erroneously announced that Paterno was already dead. The tweet was immediately picked up by CBS Sports, and subsequently by the news web sites The Daily Beast and the Huffington Post. Howard Kurtz, supposedly the preeminent  media ethics watchdog, re-tweeted the false news himself. Many other journalists did the same. But it was all based on a hoax.  Paterno was still alive. Continue reading →

Dear Banks: This Is Why Nobody Trusts You

/ Jack Marshall / 35 Comments

I know I’ve been hard on the Occupy movement, but I don’t want to let the protesters think that I’m pals with all of their targets. Take the banks, for example.

The “waiting for the check to clear” scam engaged in by banks has always been annoying, but I now realize, thanks to bitter personal experience, that we have been fools to tolerate it. Once upon a time, before electronic transfers and computers, it really did take a check at least “five business days” to go from one bank to another, but the banks have held on to the fiction that nothing has changed, presumably to give them free use of our money while we patiently wait for the completion of transactions that have already been completed. Running a small business with perpetual cash-flow problems, the Marshalls constantly hectored our bank (then Wachovia, which bought it from American Security Trust, and there may have been another one in there somewhere) about speeding up the process, and in fact they did: our checks from clients often had money available to us within a day or two. That’s right—the bank let us use our own money while telling less long-standing, savvy, or persistent customers that the checks they deposited were taking almost a week to clear. Continue reading →

Republican Nomination Ethics Points, 1/18/2012

/ Jack Marshall / 8 Comments

I’m sitting here watching the GOP Final Four debate. Here are some brief ethics observation on a lively day in the race:

  • At the opening gun, Newt Gingrich gave a bravura performance of indignation personified when moderator John King asked him about the looming ABC interview of his ex-wife, Marianne, in which she impugns Newt’s character and claims that he asked her to agree to an “open marriage.” He told King it was a despicable question and said that the issue was not worthy of mention. Good act, but of course the question of character is relevant, and of course Gingrich, who has none, wouldn’t think so. Continue reading →

Saluting the GOP’s Most Ethical Candidate, Distrusted For Doing the Right Thing

/ Jack Marshall / 3 Comments

We'll miss his daughters, too...

Jon Huntsman is gone, finally quitting the hunt for the Republican Presidential nomination long after the futility of his quest had been established. Huntsman was easily the ethics favorite in the competition, though Ron Paul’s candor and integrity also get high marks. He began his campaign with a call for civility, and seldom missed the high standard he set out for himself. Best of all, he correctly identified the ethics core of our nation’s various problems: the trust deficit. Huntsman began hitting this theme hard in Iowa, but perhaps not hard enough. The collapse of public trust in all our institutions is a very real threat to our democracy, for democracy, more than any government philosophy, requires trust to survive. Whatever it is that Republicans want right now, however, trust isn’t very high on the list, and neither is civility. Continue reading →

Liar, Liar, Volt on Fire

/ Jack Marshall / 4 Comments

Not a hotcake. Definitely selling like a hotcake.

There are times when I miss the David Manning Liar of the Month, a regular feature on my old Ethics Scoreboard reserved for flagging a breed of lie that I find the most annoying of all. These are the lies that even the liars know are unbelievable from the moment the dishonest statements leave their mouths. Then, when they are inevitably caught, the liars argue that the lie wasn’t really a lie because nobody believed it in the first place. Such lies tell us that the liar doesn’t think lying is anything to be ashamed of. Beware such people, especially when they dwell in high places. The lie may be trivial, but the attitude toward lying is not.

Spared the indignity of being a David Manning Liar by the Scoreboard’s dormant state is Rep. John Dingell, a Michigan Democrat, who took umbrage at Mitt Romney’s statement that the Chevy Volt was “and idea whose time has not come.” Dingell protested, isssuing a press release that said, Continue reading →

The Third Annual Ethics Alarms Awards: The BEST of Ethics 2011

/ Jack Marshall / 17 Comments

Why is the The Best in Ethics 2011 only about 33% the size of the “Worst”?

This troubles me. My objective is not to be negative. The problem, I think, is that ethical conduct is still much more common than unethical conduct, and it is usually less controversial to identify: most of the time, good ethics is self-explanatory. All of us learn more from mistakes and misdeeds, our own and those of others, than we do from meeting societal standards. Most of what Ethics Alarms does is to try to identify unethical conduct, what was wrong with it, why it happened, and how we can discourage it.

Which is all well and good, but I still would like to make 2012’s Ethics Alarms  more positive year than this one, if possible. Help me, will you, find more topics involving good ethics, so next year’s Best list can hold its own with the Worst.

Here are the 2011 Ethics Alarms Awards for the Best in Ethics:

Most Important Ethical Act of the Year: Acquitting Casey Anthony. The Florida jury charged with deciding if Casey Anthony murdered her daughter faced the ire of a lynch mob-minded public that wanted the unsympathetic Anthony convicted, based on suspicious conduct and a dubious explanation,  but the evidence just wasn’t there. Thus the courageous twelve upheld the American values of fairness, objectivity, and justice under the law. It is interesting that the most ethical act of the year also sparked some of the most unethical arguments of the year, by too many citizens who benefit from our nation’s ideals without comprehending them. Continue reading →

Ethics Dunce:The Baseball Writers Association of America

/ Jack Marshall / 9 Comments

"Well, yes, there was THAT, but what really matters is that he was one hell of an assistant coach!"

The high-profile Sandusky/Paterno/Penn State child molestation scandal has shaken the foundation of the sports world, and in the process, given resolve to past victims of child abuse to identify their molesters. The most recent example is veteran Philadelphia sportswriter Bill Conlin, who abruptly resigned from his job as a columnist for the Philadelphia Daily News when he learned that four adults had come forward to accuse him of molesting them when they were children in the 1970s. This created am immediate crisis for the Baseball Writers Association of America, who had this year bestowed its highest honor on Conlin, the J.G. Spink Award. It never looks good when the person you have declared to represent the best of your profession is revealed as drug-dealer, a serial killer, a foreign agent, or a child molester.

Here’s how the BBWAA dealt with the matter on its website, in this “official statement”: Continue reading →

Why Would Anyone Trust A Company That Tricks Them Into Opening Its Junk Mail?

/ Jack Marshall / 3 Comments

" Disclaimer: This document isn't intended to be as misleading as it obviously is."

The firm is Ideal Tax Solutions, and I’m sure, really I am, that the people who run it, which include lawyers bound by the professional ethics rules prohibiting them from engaging in misrepresentation, dishonesty, deceit or fraud, are dedicated and well-intentioned. From an ethics stand-point, however, why anyone would trust a company that markets its services in a blatantly misleading way is beyond my comprehension. Someone must; a lot of someones must. Yet the company introduces itself to potential customers by deceiving them.

The letter arrives in an envelope that works very hard to look like it will contain an official IRS document. The mailing stamp has an elaborate eagle and flag logo; a large 2011 is posted in the lower right-hand column. Also there: a statute number TITLE 18 SEC. 1702 US CODE. There is a window in the envelope, and the address that is visible appears on institutional pink paper.

Oh-oh. Continue reading →