Ethics and Suckers
My personal interest in trading stocks and bonds led me to analyze this case, which involves ethics in business. Wheat First is a brokerage company and a member of the New York Sock Exchange and the NASD. They operate in the city on New York and are able to make recommendations on what stocks they believe will perform well. Their clients Philip Friedman and Carl Defreitas filled a complaint to the SEC alleging misinterpretation concerning Zitel, a developer of computer software applications, hoping that the plaintiffs would open brokerage accounts with Robert Cohan, a representative of the Wheat First Corporation. Cohan claimed that he had "first hand knowledge ab
Friedman sold shares on stock in another company in order to buy (4000) shares of Zitel at $48 per share, and another (2000) shares at $43. " He told them that Wheat First has access to two executives in the Zitel corp. Defreitas purchased (1000) shares and lost $75,000 compared to Friedmans's $500,000, not including margin interest charges, when the stock plummeted to $14 per share, and both men could not answer the margin calls. " He also stated that Zitel was entering a joint venture with IBM corp. " Federal Civil Procedure 12(b) (6) Rule 12(b) (6) provides for the dismissal of a complaint for "failure to state a claim upon which relief can be granted. The court requested the NASD review the case and the NASD panel issued a statement that declared, "based on the evidence presented to the panel in the initial pleadings the panel did not find evidence to provide merit to the case. This lawsuit was an attempt to get an insurance policy on the stock market, but it just doesn't work that way. However, I believe that the case should have been dismissed because the job of a full service brokerage house is to make recommendations they think will be productive for their clients. , which claimed they would become the next "Intel" after they marketed their new software they developed to fight the "Y2K Bug. If the lawsuit were successful, every broker would have to think twice before recommending a stock. ------------------------------------------------------------------------**Bibliography**. He failed to disclose, however, that Wheat First would cease to be a market leader in Zitel due to the company's volatility, and because Wheat First had incurred large losses by investing in Zitel. and that would cause the stock to jump to $150 per share, a 200% gain. did not act ethically with their clients and does not conduct business in a just fashion.
Common topics in this essay:
Zitel Furthermore,
Wheat Corp,
Y2K Bug,
Corporation Cohan,
Carl Defreitas,
Civil Procedure,
Ethics Suckers,
Exchange NASD,
Robert Cohan,
12b 6,
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