Example Of Case Study On Coleen Colombo And Colleagues Resist Mortgage Fraud

Synopsis

In the year 2003, Coleen Colombo joined BNC’s California branch in a senior underwriter position. Colombo’s office was part of the regional group offering a sizeable amount of loans to its customers. Colombo’s performance during the initial months was exemplary. This information was contained in a wrongful termination and harassment suit filed on her behalf and five fellow BNC employees in the California Superior Court. Coleen’s work environment changed for the worse in 2005 after a male colleague, working as a wholesaler started to bring her loans containing questionable attributes like incorrect salaries and occupations. Later on, the male colleague went as far as offering her a bribe, known as a spiff, in order to clear a loan that contained incorrect information (Downey, Hellriegel and Slocum n.p).
These bribes were prevalent in the organization, as evidenced by a former employee called Sylvia Vega-Sutfin. She posited that in order to approve the mortgages, the majority of the underwriters would demand a bribe. When Vega-Sutfin refused to comply, her life in the company suddenly took a turn for the worse, with her loan files disappearing mysteriously. This led to a substantial reduction in her commission checks. In the suit, Vega-Sutfin stated that her superiors had vowed to “make an example out of her” to intimidate others who made similar bribery complaints. Colombo also reports facing similar treatment from her bosses, with her complaints about attempted bribery brushed aside by the regional vice president. Colombo found herself threatened with dismissal if she persisted with her complaints. To exacerbate matters, the male employee behind the bribery attempts started to make sexual advances towards her. These occurrences made her stay in the company untenable, and she eventually resigned in 2005. In 2008, Lehman Brothers, BNC’s parent company filed for bankruptcy. This resulted in the putting on hold of the wrongful termination and harassment proceedings initiated by Colombo and the five other workers. However, Lehman Brother indicated its intention to oppose the allegations when proceedings resumed. During this period, sub-prime loans started to go bad which caused tough times for underwriters, a large number of whom had to leave the firm. Wall Street speedily reined in the firm’s mortgage and tightened the lending standards. They also forced the lenders to buy back the risky loans that it had previously been very happy to consume. Hence, the firm teetered on the verge of collapse, and the underwriter had to look elsewhere for jobs.
The first fact-finding that presents itself is the issue of rampant corruption and bribery in the organization. One of the company’s former employees, Sylvia Vega-Sutfin, postulated that bribery was endemic and widespread in the firm. She claimed that bribes, commonly referred to, as “spiffs” were demanded by underwriters, in exchange for approval of loans. These bribery allegations find support from Colombo, who claims that a male colleague had attempted to give her a bribe in exchange for her allowing the approval of a loan with incorrect information.
In this case, the recommendations relate to the elimination of corruption in the company. It appears that corruption in BNC is deeply rooted within the fabric of the organization. That is, corruption has become almost a part of the organizational structure. Hence, this vice may prove extremely difficult to counter. An organization structure is considered as an abstraction, which brings forth forces that wield immense power in an organization (Goree 35). Thus in the case of a failure to understand the operation of these forces, grave consequences may result. These may befall both the business and its employees. Culture is the established way of doing things and the new members in an organization must adapt to its culture in order to gain acceptance by the others.
Among the most severe ethical issues that assail BNC is that of bribery. Hence, the recommendation is that the organization should develop an ethical code. This comprehensive program will aim at forming an ethical organization made up of staff that adhere to ethics and operate in an environment of trust. In line with this, the ethical code introduced should be inclusive of training on ethics (Goree 74). Through this, the cases of bribery may reduce significantly. The ethical code serves to reinforce employees’ commitment to ethics even in cases where they have suffered unethical treatment themselves. The company’s leaders should also be setting an example to the employees. Hence, in this regard, the vice-president of the firm should have taken sterner action when Colombo presented her grievances. The absence of ethical leadership in an organization has many negative effects such as low employee morale and negative image of the organization among the public (Goree 55). This culminates in poor performance of the organization, which causes an eventual collapse. A perfect illustration of this is in the case of BNC, which is on its knees because of such occurrences. Conversely, an ethical organization is very efficient and performs very well since staff is motivated, and the customers trust the organization. The organization should thus invest in the creation of an organization that exhibits high integrity. This is not an overnight event, and it takes a significant amount of time to do. However, the company should initiate this as soon as possible because and it should start by weeding out the unethical employees who are among the factors that hamper an organization from achieving superior performance.
The second fact established is the prevalence of sexual harassment in the organization. In Colombo’s lawsuit that she filed jointly with five others, she indicates that the employee who had attempted to bribe her was also guilty of sexual harassment directed towards her. This harassment took the form of deliberately rubbing his body against hers. This had the effect of making her feel afraid and very uncomfortable in the workplace environment. Another female employee also alleges similar treatment claiming that one would have thought that the male employee was a pimp and that they, the female employees, were his prostitutes (Downey, Hellriegel and Slocum 250). Sexual harassment has a negative influence on employee performance since it reduces employees’ comfort and ability. If employees are not comfortable, they cannot perform at high levels. Hence, BNC should condemn this vice in the strongest possible manner.
Sexual harassment in the workplace is an issue of concern and one, which should be intolerable. Sexual harassment is a problem that has an ethical, legal, and moral construction. Sexual harassment is a mark of ethical and moral impropriety and is a criminal offense under the law (Boland 15). Sexual harassment may take various forms, such as verbal, which involves the use of inappropriate language towards a person of the opposite sex. It may also involve physical, through grabbing and groping and rubbing oneself against a member of the opposite sex (Boland 45). Another aspect involved can be the use of inappropriate gestures towards the person. Hence, the management should deal with this issue in the firmest means possible. One way in which the organization can address this is to institute a strict zero-tolerance policy on such actions. This would start by having a code in place and training of all employees on acceptable and non-acceptable behavior. The bounds beyond which actions and words can be considered sexual harassment must be clearly defined and stated. The policy or code should also specify the action to follow in case one is guilty of a breach of the provisions of the policy (Boland 105). This enforcement should apply across the board regardless of the perpetrators’ rank in the organization. There should also be measures geared towards the prevention of sexual harassment in the organization. For instance, the organization should go through the history of employees before hiring them to observe whether any previous accusations have been filed against a particular person (Fox and Lituchy 46). The prevention of the hiring of such a person would help to guard against possible occurrence of such acts later on in the employee's career. In addition, the organization should provide for a system of support and care for an employee who has been the victim of sexual harassment. This can involve counseling and therapy sessions.
The third finding of fact that can be inferred from this particular case study is that the organization is suffering from an endemic case of poor leadership in the organization. The company’s regional vice president best illustrates this poor leadership. The vice president obviously lacks good leadership if his handling of Colombo’s case is anything to go by. Colombo, in her lawsuit, intimates that when she presented her grievances to the vice president, he was dismissive of them instead of treating them seriously. This is evident from Colombo’s assertion that she left the vice president’s office in tears after the help she expected failed to materialize. It is imperative for a good leader to listen to, and address the complaints from the employees. The leader must also take steps to resolve the issues that the employees have raised. This would start by listening to both parties to the issue. The leader should then do the investigation, and come up with an acceptable solution. The branch manager’s behavior at the California branch is also an exhibition of poor leadership. This arises where Colombo comes back to work after her leave. A fellow employee informs her that the manager wants her gone due to her persistent complaints. This is a demonstration of poor leadership since a leader should never allow his or her subordinates to know what personal feelings he has for them. Instead, the leader should always maintain a professional behavior towards the subordinates
A possible solution to this leadership issue is to train the management on leadership skills. The training may take place in seminars and conferences. The training is important since it will enable the managers to develop the key competencies that are a necessary part of success for any leader. The leaders can also be trained to implement a system of strategic management, which will involve incorporating the employees and all other stakeholders in the making of key decisions in the organization (Saloner, Shepard and Podolny 58). Doing this will cause employees to feel they are a valued part of the organization.

Works Cited

Boland, Mary L. Sexual Harassment in the Workplace. Naperville, Ill: Sphinx Pub, 2005.
Downey, H. Kirk, Don Hellriegel and John W. Slocum. Organizational Behavior. St. Paul: West Pub. Co, 1977.
Fox, Suzy and Terri R. Lituchy. Gender and the Dysfunctional Workplace. Cheltenham: Edward Elgar, 2012.
Goree, Keith. Ethics in the Workplace . Mason, Ohio: Thomson/South-Western, 2007.
Saloner, Garth, Andrea Shepard and Joel M. Podolny. Strategic Management . New York: John Wiley, 2001.