Source:
http://www.bloomberg.com/news/2013-09-10/credit-suisse-is-sued-over-mortgage-securities-losses.html
Phoenix Light SF Ltd. sued Credit Suisse over alleged misrepresentations in the offering of $362 million worth of mortgage-backed securities.
– Credit Suisse is an investment bank which helps other institution or high profile indivduals to make investments. its usually large transaction amount, such as this case of 362 Million. They built their reputation by helping their customer to make profit, while they gian commision each successful transaction. (Regardless if customer make profit or not in the end.)
– Just before the economic crisis, to make breaking record of sales, and simply running out of “investment” opportunities, multiple investment firms has started to publish some lower quality (high risk) investment in a disguise. This comes to an issue about business ethic. Eventhough it was mentioned that there wasn’t really anything known as “business ethics” earlier in this course, however, this move may affects the company’s point of parity – its credibility. The best marketing strategy is simply “the brand is what you tell your friends afterwards”, In this case , it will lose its customer base in longterm, at least, they will lose Phoneix Light as one. (following case shows good business ethics secures customer base:
https://blogs.ubc.ca/caitlinlim/2013/09/12/business-ethics/)
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