Often, after discovering that they were invested in a Ponzi scheme, victims are left in a state of shock wondering how they became embroiled in such a travesty. Many reflect, concluding in hindsight that the investment was simply ‘too good to be true.’ That shock may later turn to disbelief for those unfortunate enough to have profited from their investment, when a court-appointed receiver or bankruptcy trustee pursues clawback litigation designed to, as the very name suggests, “claw back” any profits received in excess of an investor’s contribution. Logically, those who had invested in a scheme for a considerable period of time faced the prospect of being on the hook for hundreds of thousands, or even millions, of dollars in ‘false profits’, as well as pre-judgment interest. And, in a recent development, if several court-appointed receivers and trustees have their way, some clawback targets may soon be facing the prospect of not only owing their false profits, but triple damages based on violations of state usury laws.
How ethical is Wall Street?
It is a question that has been asked countless times since the financial crisis, especially when scandals like the rate-rigging case at Barclays and prominent insider trading trials expose questionable behavior in the financial industry. A new study offers an answer: Wall Street is not very ethical at all.
By Martin Arnold, Private Equity Correspondent
High quality global journalism requires investment. Please share this article with others using the link below, do not cut & paste the article. See our Ts&Cs and Copyright Policy for more detail. Email email@example.com to buy additional rights. http://www.ft.com/cms/s/0/e5f52442-4eb4-11dc-85e7-0000779fd2ac.html#ixzz30mYtDUju
Fewer than one in four private equity firms have a formal code of ethics, yet three-quarters feel they have high ethical standards and almost half think leftwing media are biased against them, says a survey published today.…