A telling tale to end the year

One of the most closely watched COI stories of the year concerned the Facebook IPO.  As a piece in today’s Wall Street Journal  notes, this IPO is seen as a “telling example of the divided loyalties at many firms, which woo lucrative investment-banking clients and then prod brokerage customers to buy the same stocks even if they look bruised.”

What is particularly noteworthy about this example is how  starkly quantifiable the apparent conflict seems to be: “Among the 33 firms that sold Facebook shares to the public in the $16 billion deal, 62% of the 208 analyst reports have urged investors to buy the shares, according to Thomson Reuters. None has suggested investors sell the shares.”

For the COI Blog, statistics like these are relevant not only to the financial services industry. They also help inform a broader view of conflicts – one that suggests that, for a variety of reasons, mitigating conflicts generally tends to be much more difficult than is often appreciated.

And, as this blog begins its second full year, we are eager to watch each new “fresh hell” (to borrow from Dorothy Parker) in the realm of conflicts of interest emerge, as many of these do present teachable moments.  See you then, and thanks for reading the COI Blog in 2012.