Monday, November 24, 2014

A DEN OF THIEVES Banking Culture Primes People to Cheat

This should come as no surprise given the history of criminal activity in the banking industry. The mantra from the film, "Wall Street" , "Greed is Good" fits like like a glove.

The reputation of the financial sector has taken a bashing in the wake of the 2008 global financial meltdown, and after scandals involving the manipulation of interest rates, fraudulent deals and rogue traders losing billions of dollars. Now, a team of economists at the University of Zurich in Switzerland has found that when bankers think about their jobs, they are more likely to lie — evidence that banking culture encourages dishonest behaviour.

Aspects of a person’s life, such as their job or whether they have children, can affect how they behave. But when it comes to the ethics of finance, the key question is “whether the business culture actually renders bank employees more dishonest, or whether more-dishonest people simply choose to work in the banking industry”, says Michel MarĂ©chal, who co-led the study. In a previous study, which is under review at a journal, MarĂ©chal and colleagues found that prison inmates were more likely to cheat in a coin-tossing game when reminded of their criminal past. Psychologists call this effect ‘priming’.