Eliot Spitzer: Pushing Wall Street to Reform Harvard Case Solution & Analysis

New York Attorney General Eliot Spitzer faced a decision on how to stop the commission of the offense Wall Street firms during the Internet boom. Shares analysts Merrill Lynch and other Wall Street firms were charged with objectively advising retail investors whether to buy or sell publicly traded stocks. Analysts estimated a supply of strong buy, and at the same time it lightly on the Internet e-mail messages as "junk" or "powder keg." Spitzer concluded that analysts sometimes issued such ratings to buy shares of the company because of a conflict of interests: Wall Street analysts have been working to make beautiful fee for underwriting companies offer stock and other services. The usual procedure, when enforcement agency, such as the federal Securities and Exchange Commission (SEC) found this situation would be to complete its investigation and the decision to negotiate privately with the financial firm. If it can not resolve the issue, the agency will officially file a lawsuit against the company in court. This option was open to Spitzer, but in 1921 in New York gave him a statue of an alternative. Before filing a lawsuit in court - and continuing to explore the firm further - he can transmit its findings to warn the public and the brand company with offense. This case is being investigated Spitzer made the decision, and its long-term consequences for the U.S. financial regulation and financial sectors. "Hide
by Ravi Abdelal, Rafael Di Tella, Jonathan Schlefer Source: Harvard Business School 26 pages. Publication Date: Mar 04, 2008. Prod. #: 708019-PDF-ENG

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