Wikileaks Is Targeting a Major US Bank Posted By: John Carney | Senior Editor, CNBC.com CNBC.com | 30 Nov 2010 | 09:44 AM ET
While the leaked diplomatic cables published this week by Wikileaks have been roiling the global political scene, bank executives should be on guard. Wikileaks founder Julian Assange just announced that he has a trove of documents revealing unethical behavior at one of the largest banks in the US. In an interview with Forbes, Assange declined to name the bank. But he hinted at its identity. It is one of the biggest banks in the country. It still exists—ruling out Bear Stearns, Merrill Lynch or Lehman Brothers. That leaves us with a handful of candidates: Citigroup, JP Morgan Chase, Wells Fargo, Bank of America, Morgan Stanley, and Goldman Sachs. Assange says he has tens of thousands of documents showing an "ecosystem of corruption." The publication will prompt investigations and reforms, according to Assange. Ominously, Assange likens the leaked documents to internal Enron emails. Enron collapsed and the emails helped fuel criminal prosecutions of top executives. Investors in bank stocks have reason to be worried. Wikileaks has introduced a huge "event risk" into the market, a risk that exists outside of mundane things like earnings, mortgage repurchases and trading returns. Top executives at banks should be terrified. No one wants to be compared to Enron. Could Assange be over-hyping the importance of his documents? Possibly. But so far Assange has made good on his promises to publish important documents that make headlines worldwide. In any case, owning bank stocks or running a major US bank just got a whole lot more dangerous. Here's what Assange told Forbes: It will give a true and representative insight into how banks behave at the executive level in a way that will stimulate investigations and reforms, I presume. Usually when you get leaks at this level, it’s about one particular case or one particular violation. For this, there’s only one similar example. It’s like the Enron emails. Why were these so valuable? When Enron collapsed, through court processes, thousands and thousands of emails came out that were internal, and it provided a window into how the whole company was managed. It was all the little decisions that supported the flagrant violations. This will be like that. Yes, there will be some flagrant violations, unethical practices that will be revealed, but it will also be all the supporting decision-making structures and the internal executive ethos that cames out, and that’s tremendously valuable. Like the Iraq War Logs, yes there were mass casualty incidents that were very newsworthy, but the great value is seeing the full spectrum of the war. You could call it the ecosystem of corruption. But it’s also all the regular decision making that turns a blind eye to and supports unethical practices: the oversight that’s not done, the priorities of executives, how they think they’re fulfilling their own self-interest. The way they talk about it. -- Jim Devine / "Segui il tuo corso, e lascia dir le genti." (Go your own way and let people talk.) -- Karl, paraphrasing Dante. _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
