Banking Industry Culture Fosters Cheating, Study Finds

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Corbis WASHINGTON -- The banking industry seems to bring out dishonesty in people, a new study suggests. A team of Swiss economists tested the honesty of bank employees in a lab game that would pay off in cash if they cheated. When workers at an unnamed bank were asked about their home life, they were about as honest as the general public. But employees who had just been asked about work at the bank cheated 16 percent more. "Bank employees are not more dishonest than others," said Ernst Fehr of the University of Zurich, author of the study published Wednesday by the journal Nature. But he said when reminded of their job they become more dishonest, so something about the culture of banking "seems to make them more dishonest." Fehr said recent multi-billion dollar international banking scandals convinced him that he had to test scientifically public perceptions about bankers not being honest. The American Bankers Association dismissed the study: "While this study looks at one bank, America's 6,000 banks set a very high bar when it comes to the honesty and integrity of their employees. Banks take the fiduciary responsibility they have for their customers very seriously." How the Study Was Conducted Researchers studied 128 employees at a single bank (even the country where it is located was not revealed). They gave them what is a fairly standard honesty test. They were told to flip a coin 10 times; each time they flipped they could earn $20 if it matched what researchers had requested -- sometimes heads, sometimes tails. An honest person would report matching the requested flip result about 50 percent of the time. But when workers were asked questions about their work at the bank, placing their work at the forefront in their minds, they self-reported the result that paid off 58 percent of the time. When researchers repeated the test with more than 350 people not in banking industry, job questions didn't change honesty levels. Researchers tested 80 employees of other banks and they came up with about the same results as those from the main bank.