Philippine College Foundation Inc.

City of Valencia
College of Business
BSBA-2

The 2007-2009 Financial Crisis:An Erosion of Ethics

(A Case Study Analysis)

Members:
Bernard C Calapuan

Philippine College Foundation Inc.

City of Valencia
College of Business

The 2007-2009 Financial Crisis: An Erosion Of Ethics

(A Case Study Analysis)
 I. Fact of the Case

The Financial Crisis:An Erosion Of Ethics happened in United States during

2007-2009 is a devastating economy crisis that almost collapsed their financial
institution due to mismanagement and unethical way of handling their clients. That
leads to multiple financial crisis panic such us, housing and bond bubbles,abysmal
rating agency performance, excessive leverage,lax financial regulations and
disgraceful banking practice . Many people around the globe thought that the United
States is a wealthy country and never suffered such us financial crisis as other
countries does. The Government of United States let the financial institutions of their
country do their own rules in doing their business that leads in so many problems in
their economy. And how their Government resolved this crisis with the help of
Federal Reserve Bank Of New York and The Department Of Treasury did the
extraordinary efforts in saving almost every financial institutions that's in the blink og
bankruptcy during this crisis. And the actions Dodd-Frank Wall Street Re-form and
the consumer protection act signed into law to correct the unethical practice of
business specifically the major financial institutions.

II. Point of View

The  2007-2009 Financial Crisis: An Erosion of Ethics written by Edward

J. Schoen with the credits of so many sources. The purpose of the case study
is to enhance student understanding about this financial crisis and for the
faculty to use this case study in teaching students about business ethics. the
case study examines five dimensions of why this financial crisis happened that
almost collapsed the financial institutions in United States.

This case tells us what are the major causes of financial crisis and erosion of
ethics happened in United States and what are the actions that the Government do
to save the economy from this crisis and the actions they made to prevent it from
happening again.

III. Problems and Objectives

 Problem:
1. Why did financial crisis and erosion of Ethics happened in a wealthy
country such as United States?
2. How the government save almost every financial institutions that
almost file for bankruptcy?
3. What are the step of action that the Government does to prevent it
from happening again?

Objectives:

I. To understand why financial crisis and erosion of ethics happened in

the United States.
II. To be able to know how they solved this kind of crisis with their choice
of actions.
III. To know the important of ethics in doing businesses.

IV. Areas of Considerations

STRENGTHS WEAKNESSES
 The case study made to educate  This case study show vulnerable
student and use this to be side of united States economy.
included in the school lessons.

 This case study will be a lesson  This case study made other
for every country and prevent it clients and investors think wisely
from happening to others to. in choosing financial institutions
to trust.

 This Case study reaches every  This shows bad sectors in

country that have same situation
financial institutions ethical
as united States.
practices.
 this experience teaches a very  results high unemployment rate.
important lessons to learned.



OPPORTUNITIES THREATS
 It can changed the whole new  It could collapsed the whole
 methods in financial institutions financial institutions in united
unethical practices. States if their action were wrong.

 It can help clients and investors  their debt in world bank would
invest more. bubbled.

 It prevents other countries  The financial crisis could

making the same mistakes.
collapsed the whole economy.

 change the wrong perception of The trust and welfare of clients will be
other people about reach country at risk.
having no problem in money.

V. Course of Action
1. Change the policy of financial institutions and their unethical practices of
doing their business.

2. Both actions that should be done has to be beneficial to both parties.

3. The benefits and welfare of the clients should be prioritized.

4. Conflict of interest should be banned in doing business to prevent

unethical abuse of authority.

VI. Discussion

The Financial crisis an erosion of ethics happed in United States explained

how private financial institutions selfishly done their work. without thinking about their
clients financial problems, due to financial crisis happening in the country their
capabilities to pay thier loans and mortage.The unethical way of dealing client and
the issue of conflict of interest causes to a very serious financial crisis ever
happened in United States. And how the Government work extraordinary to save
financial institutions except for Lehman Brothers that filed for bankruptcy that leads
them to take seriously in saving other financial institutions.

VII. Recommendation

1. government must keep an eye on financial institutions and regulate their

actions .
2. create more law in regulating excessive interest in loan and mortages and
consider the welfare of every clients.
3. This case show how serious financial institutions can affect the entire
economy so the government must handle them accordingly.
4. every Client of financial institution must limit thier loan and mortages and
regulare repo stransactions.
5.

VIII. Conclusion

In this study, we learned that every actions should be carefully planned

specially if its affects the general community. Every business or financial
institutions should always considered the welfare and capabilities of their clients.
the conflict of interests in doing business should be set aside for the benefits of
both parties.

This Financial Crisis have been prevented if the government keep an eye
on financial institutions and considare the walfare of every citizen that paying loan
and mortage and make a law for costumers protection.