News Analysis HSBC Bank

California Baptist University

Managerial Ethics Section B

Dr. Jim Bishop

Daniel Garcia 

News Analysis 

HSBC Bank Secrecy or Tax Evasion  

US authorities are investigating whether the bank allowed Americans evade taxes after reports claim that HSBC helped hide millions of dollars in client assets. HSBC Holdings , faces an investigation by US authorities and over by British lawmakers after admitting faults of its Swiss private bank that would have allowed some clients evade taxes. Prosecutors have increased efforts to determine whether the second largest bank in the world helped Americans evade taxes after media reports said that the bank had helped rich people to hide millions of dollars in client assets. The US authorities are also investigating whether HSBC manipulated the exchange-rate an official said the investigation could lead to the Justice Department review a deferred prosecution agreement with the bank reached in 2012. The agreement was part of a pact per thousand 900 million dollars which allowed HSBC avoid criminal charges after it was discovered that helped move hundreds of millions of dollars from drug trafficking to the US financial system. It is quite possible that (the agreement) can be reopened as a result of the bank's activities in one or both fronts for tax evasion or manipulation change, said the US official, who requested anonymity because the investigations are ongoing. British lawmakers say they plan to open an investigation into the bank after it came under public scrutiny and regulators for their past practices in Switzerland. The International Consortium of Investigative Journalists (ICIJ), which coordinated the disclosure of details leaked customer data, said that the list of people with accounts at HSBC in Switzerland include professional football players and tennis, rock stars and Hollywood actors. Having a bank account in Switzerland is not illegal and many of them have legitimate purposes. Among the list of customers is King Mohammed of Morocco, politicians, corporate executives as the recently deceased president of  Santander Bank Emilio Botin, and wealthy families. The documents also mention arms dealers, people linked to former dictators and traffickers of "blood diamonds" as well as many individuals present in the current list of US sanctions, as Gennady Timchenko, next to Russian President Vladimir Putin . The Volga Timchenko Group declined to comment. The customer list was provided by HSBC Hervé Falciani, a former employee of information technologies Swiss subsidiary of HSBC. The bank said Falciani downloaded details of accounts and customers in late 2006 and early 2007. Switzerland charges against Falciani by industrial espionage and violating bank secrecy laws in the country. Falciani could not be reached for comment, but previously said he is an informant trying to help governments to persecute citizens using Swiss accounts to evade taxes. HSBC should consider the consequences of their decision can generate short and long term because although it seems to be the second most important bank in the world, forces him to take care of their prestige. One of the considerations that we have as professionals is to respect our clients and colleagues, so lying about tax evasion is not only dishonest, affecting confidence in the profession itself. HSBC Switzerland "is not interested in having business relationships with customers or potential customers who do not respond to our demands on financial crime," the company added. These revelations about past practices must remember that the old business model of Swiss private banking is no longer acceptable.

California Baptist University 

Managerial Ethics Section B

Dr. Jim Bishop 

Daniel Garcia 

News Analysis: The genuine concerns about artificial intelligence

The Bible describes God as a rational Being who created the world from nothing and who governs it as sovereign. Logic, order, purpose, natural law: these characteristics are recorded in the universe as a reflection of the will and mind of God. Besides the made of human beings in His image, which means that our mind is prepared to operate according to the divine rationality. As God is the author of the world and humanity, we are prepared intellectually to understand the truth about Him and the world He created. While some scientists have warned of concern that intelligent computers eventually develop own thoughts and destroy the human race, others consider it impossible for humans to lose control over the machines. The idea that one day decide to rebel computers is not entirely farfetched since the dawn of civilization, mankind has been obsessed by the possibility that someday will become extinct. The asteroid impact on Earth and the specter of a nuclear holocaust are the ancient fears of our time. But some scientists believe that a new nightmare should be added to the list. Their concern is that intelligent computers will eventually develop own thoughts and destroy the human race. The latest warning comes from Professor Stephen Hawking, the famous astrophysicist afflicted with ALS who said that artificial intelligence could "be more crafty than any of us," and that there is a "near certainty" of a technological disaster. Most experts do not rule out his pronouncements as a fantasy rooted in science fiction. But the pace of progress in artificial intelligence (AI), means that policy makers should already be weighing the social consequences. The idea that machines could one day be able to think like people have openly discussed since the early days of computing in the 1950s The enormous amount of money being poured into computing by US technology companies, together with the exponential growth of computer power, means that now are doing amazing predictions. According to a recent survey, half of the experts of IA in the world believe that human-level artificial intelligence will be achieved by 2040 and 90 percent say they will be achieved for IA 2075. Several experts talk about the possibility that the human brain will eventually be "designed with retro engineering." Some prominent technology leaders, meanwhile, warn that the consequences are unpredictable. Elon Musk, the pioneer of electric cars and private spaceflight in Tesla Motors and SpaceX he argued that advanced computer technology is "potentially more dangerous than nuclear weapons." Western governments must take seriously the ethical implications of developments in AI. One concern is that most of the research carried out in this field is conducted in private by technology companies in the United States. Google has made some of the most ambitious investments, ranging from his work in quantum computing to purchase this year of the company "start-up" British of IA, Deep Mind. But while Google created an ethics panel following the acquisition of Deep Mind, outsiders have no idea what the company is doing or how many resources are used to control technology instead of developing as quickly as possible. With the development of these technologies, lack of public oversight can be worrisome. That said, the risk that someday computers could pose a challenge to humanity must be put into perspective.Scientists may not be able to say with certainty when, or if, the machines will equal or surpass mankind. But before the world gets to that point, the union of human intelligence and computing undoubtedly help to address the urgent problems can not be solved otherwise. The growing ability of computers to process huge amounts of data, for example, play an important role in helping humanity to combat climate change and disease in the coming decades. There is no evidence that scientists have difficulty controlling computers, even in its most advanced stages. But this is a sector in which the pioneers must tread carefully and with open eyes to the continuing ability of science to impress.

United States Banks, contributing to illegal Trafficking

California Baptist University 

BUS520 Section B Managerial Ethics

Dr. Jim Bishop

Daniel Garcia  

US banks, contributing to Illegal trafficking.

Given the constant attacks on migrants, smugglers chose advance payments through bank deposits. Migrants have been easy prey for thieves during their way to the US border, which caused traffickers opt for the use of banks to charge in advance. Although immigration has led the US political agenda, neither the White House nor Congress has addressed the role of banks in financing undocumented traffic. On November 20, President Barack Obama issued a decree to protect the deportation to those undocumented immigrants whose children are US citizens or who arrived before 2010 were minors. Republican lawmakers objected, described the plan as amnesty and instead asked more deportations. Traffickers increased the use of banks after the former attorney general of Arizona Terry Goddard lash Western Union Co., the world's largest money transfer company. Western Union denied his guilt while acknowledging that its employees had allowed traffickers use their services from 2003 to 2007. The company agreed to hire more investigators and inform the authorities of any money order over $ 500 to and from the American Southwest. Since then, we have seen a significant change in banks. Industry researchers say banks can and should do more to close the monetary channels traffickers. The truth is that the big banks ask their researchers focus first stop any suspicious activity to finance terrorism, tax evasion and drug transactions. Detect accounts that fund the illegal trafficking is less important. Human traffickers prefer Bank of America, JPMorgan and Wells Fargo because they need banks with branches nationwide to receive payments. Criminal gangs use a simple scheme called "accounts funnel." First, traffickers open accounts in US territory under their own names or people trust, then friends and relatives living in the United States for people looking to migrate must deposit payments in those accounts. Traffickers after withdrawing money from bank branches, often near the border with Mexico. The Office of the Arizona Attorney General has documented $ 360 million of funds used for trafficking funnel transferred through accounts based in Arizona between 2008 and 2013. Although there is no evidence that banks have deliberately acted in collusion with traffickers, institutions have failed their responsibility to detect and report suspicious deposits and withdrawals of cash, including money flowing through their accounts at the hands of gangs. According to Terry Goddard regulators and bankers are not doing a good job in monitoring their accounts, do not employ an ordinary level of suspicion. The Bank Secrecy Act of 1970 and the Patriot Act of 2001 require US banks monitor any transaction that may be linked to money laundering and other crimes, including human smuggling. Banks must designate an official responsible for such compliance, identify the crimes that their customers are at risk of committing and develop policies to detect and stop this type of transaction. Banks must report any suspected criminal activity to the Financial Crimes Enforcement Network, an agency of the Treasury of the United States. FinCEN submitted reports of suspicious activity to the police for further investigation. These injunctions researchers themselves instructed banks to seek common patterns smugglers as large cash deposits made in a state which were then removed almost immediately in the southwest. Banks identified and marked hundreds of accounts for the fiscal investigated, according to an affidavit by a federal agent. Banks were not accused of any crime. There is nothing illegal about making a cash deposit in a bank; people do it all the time. But by failing to prevent traffickers from using their institutions, banks continue to allow illegal trafficking and often violent. Thus the most important banks in our country contribute in some way to the illegal trafficking. I refuse to think that doing banking activity is always associated to actions of usury. Neither our banks are organizations dedicated to defraud, nor are global example of how business should be done by setting the example to follow. We are in a sort of ethical mediocrity, and urges raise the standard, especially since the country will enter a vigorous development stage where credit is fundamental. Where is the ethics of bankers? Who sets the example? What financial institution inspired living standards of its founders? The US based Ethisphere ranks annually to various companies in various sectors regarding their degree of ethics. This year, the bank took first place overall as the most ethical bank in the world was the Banco do Brasil. Three Australian banks appear in the top five. Old National Bancorp: Only one American appears. Measure ethics is not easy. Is it ethical for a bank that lent good intentions but whose client was fraudulent? Is it unethical that a director is paid a large bonus based on pressures sales force to place credits that customers do not need? Is it ethical to telephone customers to accept an individual credit, personal or payroll knowing that the call was premeditated from the bank and to make us no matter the economic condition of the borrower potential, but only your reply to charge interest? Citigroup defined this year as the year of ethics. As such, we need to listen exemplary actions to correct the problems that have been released. Only then can we believe that the massive credit key will open that attribute, so rare and so elusive: ethics.

General Motors Recall

California Baptist University 

News Analysis: General Motors Recall 

BUS520 Section B Managerial Ethics

Dr. Jim Bishop

Daniel Garcia 

General Motors issued a recall for repair due to a defect in the ignition systems switch that could cause security problems in hot conditions. The recall covers certain models from 2011 and 2012, and some from 2007 to 2014 that were repaired with defective parts. General Motors said actuators lock on may be too broad , making it difficult to turn the key when the vehicle is hot. Last year , GM called Repair 2.6 million small cars due to faulty ignition switches , to which at least 42 deaths and 58 people injured were linked . The American company faces a lawsuit in federal court in California accused the automaker by the devaluation of the vehicles, that have suffered as a result of the constant recalls. The lawsuit seeks to compensate General Motors  firm owners million cars and trucks up to 10 billion dollars before the devaluation of their vehicles after a series of calls to review by misfiring . According to the lawsuit filed in federal court in Riverside , California, General Motors harmed their clients to hide from them known defects and choose to reduce costs rather than provide security . Just this year , the US automaker has made about 40 calls for review of more than 20 million vehicles . These requests have made ​​the late model cars lose between $500 and $2200 on its resale value . The case could see more than 10 billion dollars and seeks to force General Motors to pay about 15 million owners of cars and trucks not only to vehicles who were called to review by damage to their brand and reputation. General Motors spokesman declined to comment on the lawsuit and said many customers and analysts recognize the strength of the brand and that recognition has resulted in higher sales prices and residual value. The applicant, a resident of La Quinta, California, said he would not have bought a used 2010 Buick LaCrosse , or would have paid less for it , if General Motors had done a better job in disclosing defects in vehicles . His lawsuit seeks compensation for people who own or rent vehicles from General Motors sold between July 10, 2009 and April 1, 2014 , or subsequently sold those cars at discounted prices. The vehicles affected by known prior to review by a fault in the ignition system are not included in the application, which are linked to thirteen deaths. Our Lord Jesus Christ taught that business should be conducted with honesty and integrity , are a legitimate enterprise. Today more than ever , greed motivates most of the unethical behavior.The rhetoric of organizations leads to trite speech that social responsibility is strategic, but few reveal how much they invest in their development and implementation. Therefore , although the ethics and responsibility are close concepts should define them to define the real corporate responsibility , eliminating the reductionist view and taking a more holistic version where all behavior count. Just imagine how characters like Steve Jobs, Warren Buffett, with the sole goal of profitability. There are other aspects as would be the historical significance or responsibility for all stakeholders involved. Sure, we could also identify negative elements like greed or power, which inevitably lead to serious errors in the decision making and unethical.

JPMorgan Chase Greed Goes Up

California Baptist University 

News Analysis: JPMorgan Chase Greed goes up

BUS520 Section B Managerial Ethics

Dr. Jim Bishop

Daniel Garcia 

God calls men and women to participate in business. The work has an intrinsic value and how humans meet the ongoing mandate to subdue the earth.The Bible teaches that integrity is essential to the business; clearly shows that business should be conducted honestly.

Jamie Dimon JPMorgan Chase CEO, helped pressure Congress to pass a bill to allow the federal government to continue functioning throughout most of next year. The bill included an issue that was not related, allowing banks to resume trade in products derived from its branches with insured taxpayers. Years have passed since the collapse of Lehman Brothers triggered a global collapse. Never again would be allowed Wall Street to write the rulebook on its own. To some extent government ,cut the wings. Big banks lobbied hard to change paragraphs Reform Act Dodd-Frank, 2010. In many cases failed. Hence, Washington now has a financial protection agency consumer. The Federal Reserve has imposed a cap on leverage ratios of Wall Street. Banks spend many types of derivatives through central clearing. Under the Volcker Rule transactions must maintain its own separate deposit business. Many of these reforms can be considered as progress particularly the leverage limits. The compliance departments of banks have grown a lot to keep up with a flood of regulations that few believe they can help lower the overall risk. The sequel of 2008 is in no way a simple story of Wall Street scamming. When the system collapsed in 2008, Washington did anything to hold it. Timothy Geithner, the first Treasury Secretary of president  Barack Obama, who ignored the Old Testament called fundamentalists demanding that the big banks were liquidated and their CEOs brought to trial. Geithner and his colleagues were making the rules as they advanced to prevent a collapse that had thrown the world into a depression. His patience was pragmatic. Unfortunately, they maintained long after the crisis had passed. The four major banks in our country are JPMorgan, Citibank, Bank of America and Wells Fargo they have 68 percent of US deposits and a higher percentage of participation in the US derivatives trading. The apologists believe that the crisis began with investment banks, rather than commercial. There has been no improvement in the culture of Wall Street. Markets work in psychological cycles that fear gives way to greed and then the hangover. Greed goes up again. No regulators that can predict the event. But they could do more to be ready when they arrive. The spending bill containing another point that has nothing to do with keeping the government running. This increases the limit of what an individual can donate to a political party now over $ 700,000.The idea that someone can do well financially and also benefit the community is relatively new, which arose as a result of capitalism, a system that can not function properly without proper ethical foundation.  

On several occasions we have heard that the love of money is the root of all evil , not the mere possession of wealth, and unfortunately so is .  I as a Christian  know that God condemns greed. Today more than ever, greed motivates most of the unethical behavior, not only in our country this issue is all around the world. The Bible is clear about it, a vice that must be abandoned when the person puts their faith in Christ Jesus . The command to do justice , to love mercy , and walk humbly with God , applies to businesses and states that should be governed by the principles of justice , love and humility. Ethics therefore becomes desirable that holds the value of companies translated their brands . Company reputation is none other things than the result of the alignment of ways of doing, behave, think, say , with the ethical values of the company and the brand promise holds .

News Source: Bloomberg 

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