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Ethical Challenges

1. What are some ethical challenges the financial services industry faces? What can be done to mitigate the potential for unethical behavior in the financial services industry?

2. Distinguish between ethical and unethical behavior in a bankruptcy setting

3. Explain ethical challenges an accountant could face in recognizing revenue for a firm. How could these challenges be addressed?

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1. What are some ethical challenges the financial services industry faces? What can be done to mitigate the potential for unethical behavior in the financial services industry?
There are several ethical challenges the financial services industry faces. One challenge that rocked the economy recently was the widespread creation of unproductive or toxic assets. There are several investment banks that could have collapsed had the government not stepped in with support. Other unethical practices include redlining or discriminating against some areas or customers for giving loans, including hidden charges in credit cards, including previously undisclosed charges related to loans and line of credit, and charging excessive commission for foreign exchange transactions.
There are several steps that may be taken to mitigate the potential for unethical behavior. The first step is that a code of ethics should be developed by the banking regulatory authority and circulated to all banks In the US such a code can be developed by the Federal Reserve and circulated to all members. Further, each financial services provider should develop its own code of ethics and should circulate it to all its employees. Any activity that violates the ethics code of conduct ...

Solution Summary

Ethical Challenges are discussed in great detail in this solution.

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