The financial industry has been under serious scrutiny lately with the backlash from the London Interbank Offered Rate (LIBOR) scandal. A recent survey, though, showed that American and British financial services professionals find lying and cheating to be a regular occurrence.
The New York-based law firm, Labaton Sucharow, interviewed 500 employees in the financial industry, and found that 24 percent of respondents believed that financial services professionals may need to engage in unethical or illegal conduct in order to be successful. In addition, 26 percent said they had observed or had firsthand knowledge of wrongdoing in the workplace.
"When misconduct is common and accepted by financial services professionals, the integrity of our entire financial system is at risk," Jordan Thomas, partner and chairman of Labaton Sucharow’s whistleblower representation practice, said in an AdvisorOne article.
Simon Johnson, author and MIT professor, wrote a piece for the New York Times that commented on how the situation has cast a severe shadow on the entire industry. Specifically, he said that Barclays and other large banks have completely destroyed the legitimacy of which sensible financial intermediation should be based on.
Johnson added that the overall collateral damage was especially disastrous. At this point, fewer individuals will be able to trust bankers. Johnson brought forth the question, "Who in their right mind would buy a complex derivative product from Barclays or anyone else implicated in this growing scandal?"
While this incident is relegated to the financial industry, it teaches a valuable lesson to employers in all industries. Unsavory business practices are not beneficial for any type of company, and as such, managers or HR representatives need to be selective in the screening process. Levels of aptitude and customer service tests as part of pre employment testing will help ensure that applicable candidates will represent a business in the best possible light.