It is currently 23 Sep 2017, 22:14


GMAT Club Daily Prep

Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.

for You

we will pick new questions that match your level based on your Timer History

Your Progress

every week, we’ll send you an estimated GMAT score based on your performance


we will pick new questions that match your level based on your Timer History

Not interested in getting valuable practice questions and articles delivered to your email? No problem, unsubscribe here.


Request Expert Reply

Confirm Cancel

Events & Promotions

Events & Promotions in June
Open Detailed Calendar

Shortly after September 11, 2001, the United States began

  new topic post reply Question banks Downloads My Bookmarks Reviews Important topics  
Author Message

Hide Tags

1 KUDOS received
User avatar
Joined: 24 Aug 2012
Posts: 140

Kudos [?]: 273 [1], given: 2

Reviews Badge
Shortly after September 11, 2001, the United States began [#permalink]

Show Tags

New post 06 Nov 2012, 19:24
This post received
Shortly after September 11, 2001, the United States began requesting additional financial information about persons of interest by subpoenaing records located at the SWIFT banking consortium. SWIFT, which routes trillions of dollars a day, faced an ethical dilemma: fight the subpoenas in order to protect member privacy and the group's reputation for the highest level of confidentiality, or, comply and provide information about thousands of financial communications in the hope that lives will be saved. SWIFT decided to comply in secret, but in late June 2006, four major U.S. newspapers disclosed SWIFT's compliance. This sparked a heated public debate over the ethics of SWIFT's decision to reveal ostensibly confidential financial communications.

Analyzing the situation in hindsight, three ethical justifications existed for not complying with the Treasury Department's requests. First, SWIFT needed to uphold its long-standing values of confidentiality, non-disclosure, and institutional trust. The second ethical reason against SWIFT's involvement came with inadequate government oversight as the Treasury Department failed to construct necessary safeguards to ensure the privacy of the data. Third, international law must be upheld and one could argue quite strongly that the government's use of data breached some parts of international law.

Although SWIFT executives undoubtedly considered the aforementioned reasons for rejecting the government's subpoena, three ethical justifications for complying existed. First, it could be argued that the program was legal because the United States government possesses the authority to subpoena records stored within its territory and SWIFT maintained many of its records in Virginia. Second, it is entirely possible that complying with the government's subpoena thwarted another catastrophic terrorist attack that would have cost lives and dollars. Third, cooperating with the government did not explicitly violate any SWIFT policies due to the presence of a valid subpoena. However, the extent of cooperation certainly surprised many financial institutions and sparked some outrage and debate within the financial community.

While SWIFT had compelling arguments both for agreeing and refusing to cooperate with the U.S. government program, even in hindsight, it is impossible to judge with certitude the wisdom and ethics of SWIFT's decision to cooperate as we still lack answers to important questions such as: what information did the government want? What promises did the government make about data confidentially? What, if any, potentially impending threats did the government present to justify its need for data?

1) Which of the following can be inferred from the passage?

A) No clear cut answer as to the legality of SWIFT's cooperation existed
B) SWIFT failed to adequately consult its legal staff before deciding to cooperate
C) The volume of money routed through SWIFT declined after its cooperation became public
D) U.S. authorities threatened criminal charges if SWIFT refused their subpoenas
E) Treasury Department officials objected to the publication of information about its classified program

[Reveal] Spoiler:
Correct Answer: A

2) Inferring from the passage, which of the following constituted an ethical justification for SWIFT complying with the government?

A) The U.S. government can subpoena information that pertains to its citizens
B) SWIFT executives believed another catastrophic attack was imminent
C) Providing data to the government based upon a valid subpoena did not explicitly violate SWIFT policy
D) Despite ostensibly poor oversight, senior Treasury Department officials assured SWIFT that data would be kept confidential
E) U.S. officials told SWIFT officials exactly why Treasury needed the information

[Reveal] Spoiler:
Correct Answer: C

3) The author suggests which of the following is the most appropriate conclusion of an analysis of the ethics of SWIFT's decision?

A) SWIFT acted inappropriately as it compromised its long-standing values of integrity, privacy, and confidentiality
B) SWIFT's actions cannot be judged with perspicuity as answers to important questions are still unknown
C) SWIFT acted properly as it complied with the requests of a sovereign government in an attempt to save lives
D) SWIFT's actions endangered the flow of commerce by sparking public outrage at an important institution
E) SWIFT's actions were appropriate initially, yet should have been discontinued prior to June 2006

[Reveal] Spoiler:
Correct Answer: B

4) According to the passage, each of the following describes SWIFT EXCEPT:

A) Had data stored in Virginia
B) Valued confidentiality and non-disclosure
C) Routes trillions of dollars a day
D) Composed of a consortium of banks
E) After over a month of deliberation, complied with the government's subpoena

[Reveal] Spoiler:
Correct Answer: E

5) The author implies that which of the following most likely occurred as a result of the news stories that ran in June 2006:

A) U.S. government officials decried the leaking of classified information
B) SWIFT executives conducted a thorough internal review to assess the legality of SWIFT's actions
C) Some foreign members of the SWIFT consortium demanded answers from SWIFT's executives
D) Many members of the public and financial community debated SWIFT's decision
E) Financial data and transactions slowed as a result of the publication of SWIFT's cooperation

[Reveal] Spoiler:
Correct Answer: D


Push +1 kudos button please, if you like my post

Kudos [?]: 273 [1], given: 2

Shortly after September 11, 2001, the United States began   [#permalink] 06 Nov 2012, 19:24
Display posts from previous: Sort by

Shortly after September 11, 2001, the United States began

  new topic post reply Question banks Downloads My Bookmarks Reviews Important topics  

GMAT Club MBA Forum Home| About| Terms and Conditions| GMAT Club Rules| Contact| Sitemap

Powered by phpBB © phpBB Group | Emoji artwork provided by EmojiOne

Kindly note that the GMAT® test is a registered trademark of the Graduate Management Admission Council®, and this site has neither been reviewed nor endorsed by GMAC®.