When Helping is Not Helpful - Ethical Guardrails

We all need to establish some guardrails in our life.  At times, these ethical and moral guardrails will help us to stay on the path to our true long-term goals rather than getting distracted by immediate gratifications of money, fame, or acceptance.  These guardrails are the “I will never” and “I will always” standards that we set for ourselves to avoid the pitfalls of getting lured into unethical behavior based on personal gain, avoiding situations, or even helping others. I consider myself a person of strong moral values and integrity and although I don’t consider myself immune to ethical dilemmas, I do consider myself fairly strong in that area.  However, this week I listed to a podcast that gave me some food for thought in this area.

A podcast host interviewed a gentleman who was very successful working for a financial firm and earning over $500,000 annually whose life was turned upside down when he was convicted for activities related to insider trading.  This financial professional was very open in discussing the events that led up to this conviction. This man was approached by a friend who was in hard times to share bits of information that might help him to earn money through buying and selling small lots of stocks.  In return, for the information the friend would share 1/3 of his earnings with the financial professional, keep 1/3 for himself, and set aside 1/3 for taxes.  Being less enticed by the payoff but more concerned about helping his friend in what seemed like a small infringement that did not actually steal from any individual.  After all, when someone makes money on the buying and selling of stocks, who is the victim?  There appears to not be any as the value is created from nothing.  So, they agreed to this arrangement and the man began to share inside information that allowed his friend to carry out this plan.  The financial professional received a few payoffs of several thousand dollars over time.  They generally met in a café to make the financial exchange.

One day the friend called to arrange for the exchange and was on a time crunch to leave town and asked if the man could meet him in a parking lot instead so he could get on the road faster for his trip.  They agreed and make the exchange in the parking lot.  The next day, the FBI showed up at the financial professional’s home and interrogated him regarding his insider trading activities. The man immediately confessed and cooperated with authorities.  After learning more about the situation, he learned that his friend was not buying and selling small amounts of stock, but had in fact made millions of dollars on this activity even though he had passed on $3000 to $5000 to the financial professional to make it appear he was making similar amounts.  The financial professional had made approximately $75,000 in these transactions which is certainly a significant amount but compared to his income was a mere 15% of his annual salary.  He also learned that the meeting his friend arranged in the parking lot rather than in the café was a sting operation that allowed his friend to obtain a plea bargain if he helped the FBI to convict the financial professional.  They both were convicted, spent time in prison, and had substantial setbacks to their careers and family relationships.

The lessons learned for me both in this week’s topics of study and listening to this podcast is that sometimes even people of high integrity can get lured into unethical practices under the guise of “helping” others.  This is a valuable lesson that we all need guardrails – those boundaries that we do not cross even when it comes to “helping” others.