Spring 2014, Vol. 39, No. 1

Abstract: For more than a century law firms, investment banks, accounting firms, credit rating agencies and companies seeking regular access to U. S. capital markets made large investments in their reputations. They generally treated their customers well and occasionally even endured losses to maintain their reputations as faithful brokers, dealers, issuers and gatekeepers. Many would conclude that this has changed. In this “Viewpoint,” the first of more to come, the author expresses his concern that today’s leading capital market participants no longer treat customers as valued counterparties whose trust must be earned and nurtured, but as distant counterparties to whom no duties are required. The rough and tumble norms of the marketplace have replaced the long standing fiduciary model in U. S. finance. The result has been unrelenting financial scandal.