The Ethics Test That Many Failed…

How would you do?

For all of your past sins, I thought I’d punish you again with an irresistible ethics test! This is the same test that I published earlier, but I figured I’d give you another shot at passing it…  🙂

Don't be a bystander

The good news is that, if you take it, I promise you’ll pass it with absolute ease. All you’ll need is a moral compass and a pinch of courage to follow it. I’m sure you have both, but, if you don’t, I think we should definitely talk….

The bad news is that some have failed the test quite spectacularly. If this unsettles you just a tad, don’t worry—it should unsettle you. Amongst those who failed were our finest and brightest. They included our highest paid executives, attorneys, accountants, bankers, financiers, journalists and academics who, by failing the test, made possible many of the recent high-profile financial scams. The only mistake the victims of the scams made was to trust these folks. Sadly, for many, that trust financially destroyed them.

I suppose I could be kind. I could perhaps suggest, for example, that those who failed the test never had any intention of profiting from the scams they enabled—but that wouldn’t be true. Or I could argue perhaps that the only reason they failed the test was that they had inadvertently skipped that one college class that might have helped them pass the test—but that too wouldn’t be true. 

In fact, all that happened was this:

When faced with a choice between integrity and self-interest, they simply chose self-interest. They put their own self-interest, greed and arrogance ahead of integrity. That’s why they failed the test…

Finally, you may (or may not!) be interested to know that I originally decided to call my test “The Rolex Test”—until I realized that Rolex might not be too thrilled if I used that name. So, I retreated. I decided instead on another name: “The Subway Test.” It’s time for you to know why I chose that name…

The Subway Test begins…

So, you’ve just got off the subway with your fellow-commuters. You’re on your way to the escalator that’ll release you to street level and some badly needed fresh air.

Without any warning, a seedy looking guy blocks your way. He’s brandishing a small, attractive, velvet-covered case. As he forces you to stop, he flips open the case to reveal a stack of quite expensive watches. 

FakeRolexes-640x360

As he pulls a Rolex from his case, he grins and breaks the silence—

“Wanna buy a Rolex, pal?” he asks…

Clearly, you’re not his pal. But, as you look at the watch, you have to admit it looks just like the real deal. And, as he hands it to you, you notice that it’s as light as a feather. Immediately, you smile. You know  exactly what’s happening here…

You can’t stop smiling. You begin to think it might be fun to fool your friends into thinking you actually bought a really expensive Rolex. 

“How much?” you ask your new friend.

“$55,” he responds.

“$20 and it’s a deal,” you say. 

“OK,” says he without flinching…

Although you immediately regret you didn’t offer him $10, you gladly exchange some crisp bills for the watch…

My initial question to you is a loopy goofy softball…

Were you scammed when you bought the watch? 

The answer, of course, is obvious—

“Hell, no! You were simply buying a fake watch knowing it was a fake.” 

There was no scam here, folks. No, not even close…

The tale continues…

Later that day, you show your new watch to a friend we’ll call “Bob” and who you know is experiencing some difficult financial times. He’s having trouble paying his rent and child support. He’s really down on his luck. And then, sadly, to make matters much worse, you learn he’s developed a habit that he can’t shake: Occasionally, he gets hungry—and he needs to eat… 

You’ve already lent him money. Like the true friend you are, you’ve also written off any possibility that he’ll be able to repay you before your 21-year-old son has turned 60. Your only solace is that you feel you’re a good guy…

Bob interrupts your thoughts. You hear him excitedly tell you he’s raising money for his new project. Naturally, he asks if you’d be interested in investing. Without even the slightest hint of a chuckle, you decline politely. You really are also a kind soul…

Bob’s gaze then shifts to your new watch. He’s intrigued. As you tell him it’s a fake, he asks if he can borrow it for a day or two. He tells you that he’s having dinner that evening with a prospective investor who he wants to impress. Bob thinks the watch might impress him.

You feel bad for having just declined his invitation to invest in his project, so you agree to lend him your new fake watch—despite knowing instinctively that this is probably a mistake…

When Bob mentions the name of the friend he’s having dinner with, it sounds familiar. It turns out you actually know him quite well. His name is Hal. You and Bob joke about how often peoples’ paths seem to cross quite inexplicably.

Bob is excited as you tell him that Hal is a good guy. Bob immediately invites you to join them that evening for dinner. He admits he’s hoping that Hal might be more comfortable with you at the dinner. With an increasingly uneasy feeling, you agree—even though your instincts are screaming out that this might be another mistake…

At dinner, Bob shows Hal his new watch. 

“Ain’t this a beauty?” Bob gushes.“Y’know,” he continues as he smiles at you, “Michael and I went to Tiffany’s a couple of days ago. When we saw this particular Rolex, I just couldn’t resist it—even though it cost $30,000. Paid cash.”

Hal is clearly impressed with the watch, but you can’t help but notice he’s looking quite intently at you. While your unease grows, you return his gaze, but say absolutely nothing…

Maybe it was the watch or the wine, but, as the evening progresses, Hal’s attitude to Bob begins to warm up. He clearly feels some comfort that you know Bob. Finally, Hal tells a beaming Bob that he’ll indeed consider investing in Bob’s new business and that Bob should send him an investment package. 

Needless to say, Hal invests and loses his investment. It seems that Bob’s deal (that you knew nothing about) was a scam…

Some questions for you…

Here are some questions for you:

When you remained silent as Bob claimed that you were together when he bought the watch, did you thereby become part of Bob’s scam?

In my world, the answer is an emphatic “Yes!”…

Looking back, knowing what you knew about Bob, should you have ever lent him your watch?

Again, in my world, the answer is an emphatic “No!”…

Looking back, what should you have said when Bob claimed you were with him when he bought the watch at Tiffany—and how should you have said it?

This probably depends on your personality. If it were me—and because I’m a bit of a smart-ass, I’d probably have joked that Bob has a terrible sense of humor and that he was spending way too much time seeing who could spot a fake watch. And no, you weren’t with him at Tiffany’s. And, yes, the watch is a fake.

Finally, the last question:

Can you ever justify looking away when those around you are acting unethically and lying and cheating—particularly when you know that someone might be hurt directly or indirectly by your silence?

In my world, you cannot look away…

Postscript …

For my book on scams, “Detecting the Scam: Nelson Mandela’s Gift,” I researched three scams: the Enron, Ahmed Chalabi and Bernard Madoff adventures.

In each of these scams, the scammers and their enablers had successfully persuaded their marks either by their statements or by their silence that the fake Rolex each was offering was real. Like Bob in my Test, in each scam, the scammers and their enablers absolutely knew the Rolexes were fake. Despite this, they did and said nothing—preferring instead to benefit financially from the lies the scammers were peddling…

Sadly, for their victims, the results were calamitous…

Einstein

So, what is the “gift” here?

If you want to bring your ideas to life, you have to lead by example and act ethically. You should never look away and remain silent as those around you lie, cheat or act unethically.

And above all else, perhaps, you have to maintain your sense of curiosity and be unafraid to ask questions…

Curiosity Passion

14 thoughts on “The Ethics Test That Many Failed…”

  1. Michael: This is a GREAT narrative and one that is along the lines of those I have used in interviews designed to help select new firm leaders. Rather than pose stupid questions about “tell us what you think your strengths are,” it proves to be so much more powerful to pose a realistic scenario and then ask, “so tell us please, what would you do in this situation.” I would welcome reading other scenarios that you have crafted along this line and suggest that you look at them as a powerful interviewing tool.

  2. Great story and it has merit, as the ex Chief of Army stated: the behaviour you walk past is the standard you set….

    Oh and Yes I do have a fake Rolex too!

  3. Hah! I wouldn’t have bought a watch from a person in the street in the first place, regardless of whether it had a prestigious brand name or not……. Reading this and noting my own responses, gave me a good laugh. Thank you!

  4. An interesting scenario, which for me was all about trust, and breach of trust.
    Which causes me to ask: is the mere wearing of a fake Rolex, (etc), in circumstances where people seeing it are likely to be deceived about your financial status (etc), an unethical act?

    To put that another way: why would you want to wear an expensive -looking fake Rolex?

    1. Good questions all, Howard! I suppose, for some people, it’s all about first impressions. My experience in Los Angeles is that some in the entertainment industry, for example, tend to judge others by their external trappings. They seem to equate those trappings of apparent wealth with success and talent. That might begin to explain why some people might wear a fake Rolex or rent a really expensive car for a week of important meetings. I know: It is a little sick! 🙂 Many thanks for your comment…

  5. Love the story. Like others, I wouldn’t have bought the watch so the rest of the story wouldn’t be relevant to me, but I know it can be really hard to speak up when a friendship is at stake.

    While the deal to buy the watch wasn’t unethical, wearing it to impress is intentionally misleading. And showing a friend who can’t afford food that you wasted $20 on fake jewelry was unkind.

  6. Great article – serious food for thought. More so in corporate world. Scenario oft recurring – I know the boss cuts corners, I know he is well liked by senior management possibly to a point where when you report the scam it will come back & bite you. You are apprehensive to tell your boss fearing the repercussions and you go away convincing yourself – I’m okay I did not participate in it nor did I ever do wrong… Deep article. Thank you for the post.

    1. Thank you so much for your comment, Abdulwahab… You are absolutely right: The boss cutting corners is such a difficult situation to have to deal with… As with everything, there are not always easy answers to every situation in which you might find yourself…

  7. Good story particularly how the questions become seemingly more ambiguous because of the preceding questions.. Along similar lines is a great test relating to racism at the Harvard website http://implicit.harvard.edu/implicit /
    It asks a series of simple questions which challenge you to face your own biases. Similarly eye-opening when you consider how many leaders are hiring managers but fail the test so to speak.
    For those leaders that fail your ethics Mike,how many like-minded people have they recruited and promoted through the ranks?

    1. Thank you, Colm… I absolutely agree with your comment about leaders. I’m convinced, for example, that ethical cultures flow from the very top. If leaders don’t aggressively set the tone for those they lead behaving ethically, is it any surprise that unethical behavior begins to permeate entire organizations? Don’t know if you’ve had an opportunity to read the next post which I think addresses this head-on… Again, thanks so much for your comment…

Comments are closed.