Is There a Correlation Between Occupational Fraud and the Downturn in the Stock Market?

Upstatetoday.com reports that Dr. Daniel Wueste, director of the Rutland Center for Ethics at Clemson University, sees a direct correlation between poor business ethics and the current downturn in the economy.  He notes that in order for a stock market to function properly, investors must have a certain level of trust and confidence that businesses are behaving ethically and in such a way that those investors will not be taken advantage of or defrauded.

Dr. Wueste believes that recently reported examples of unethical behavior, excessive officer compensation, poor lending practices and basic greed have led to a decline in the level of investor trust and confidence that has translated into a decline in market numbers.  The decision of the Big 3 automakers to send officers to Congress to ask for help and flying them in by private jet is cited as one of the events that has led to the continuing decline in confidence.

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