标题: Ethics Question problem [打印本页] 作者: cmacedo 时间: 2011-7-13 13:36 标题: Ethics Question problem
"An analyst provides asset management services for a non-profit organization and in return gets free membership in the organization. His supervisor in the organization calls him and tells him to buy a certain stock for the portfolio based upon insider information. The analyst objects, but the supervisor says this is what they have always done and sees no reason for changing now. The analyst complies with the request. With respect to Standards IV(A), Loyalty to Employer, and II(A), Material Nonpublic Information, the analyst violated:
a) only Standard II(A) that prohibits insider trading.
b) both Standards IV(A) and II(A).
c) only Standard IV(A) requiring duty of loyalty. "
the correct answer is option (a). I understand that part about material non public info. but my question is why not option (b) which includes Loyalty to employer. Under guidance about Whistleblowing, in order to protect clients or integrity of the capital market, one can violate this rule about loyalty to employer. by using MNI, you are violating the integrity of the capital market. the analyst should have rejected and dissociated himself from the job at least.
thanks in advance
Edited 1 time(s). Last edit at Monday, February 7, 2011 at 10:46AM by ayaz_mahmud369.作者: kd26gioi 时间: 2011-7-13 13:36
Not really following your argument here. If the analyst is allowed to reject his employer's demands then obviously he wouldn't have violated the standard and you can rule out both B and C.作者: sgupta0827 时间: 2011-7-13 13:36
I think your logic is flawed.
Failing to disassociate =/= Violating Loyalty to Employer作者: MythosHF 时间: 2011-7-13 13:36
hmmmm
does this mean that he bought the shares and thus did not violate Loyalty to Employer?
and if he rejected and dissociated, he would have violated Loyalty to Employer?
but his dissociation would have been justified also because his duty towards the integrity of the cap market?
Thank you for helping me out "notic4lyf".作者: LokiDog2 时间: 2011-7-13 13:36
Basically the whole Loyalty to Employer standard doesn't apply here.
He can choose to accept the decision and violate II(A), Material Nonpublic Information
or
He can choose to disassociate and violate no standards.
