Federico Buenrostro was the CEO of the California Public Employees’ Retirement S

Question

Federico Buenrostro was the CEO of the California Public Employees’ Retirement System (CalPERS) from 2002 to 2008; Alfred Villalobos was a CalPERS board member from 1993 to 1995. Buenrostro created false documents that enabled Villalobos to make money as a placement agent between CalPERS and Apollo Global Management, a pension fund investment firm. The two were indicted in March 2013 for conspiracy to commit mail and wire fraud (among other charges). The CalPERS Web site is www.calpers.ca.gov. a. Which school of ethical thought guided Buenrostro and Villalobos? Justify your response. b. How would proponents of the other schools discussed in the chapter evaluate the ethics of their actions? Justify your response.

Explanation / Answer

a. I will use Normative Ethics to discuss the ethical issues here. Normative Ethics deals with human conduct in a particular situation.

Egoism Theory falling under “Consequentialist Theories” of Normative Ethics directed Buenrostro and Villalobos in their actions. As per Egoism Theory, an action will be morally or ethically correct if outcomes of that action are beneficial to only the individual carrying out the action. In this case, only the two individuals, viz., Buenrostro and Villalobos, would get benefited by the frauds committed by them as incumbents and hence that would be their justification for engaging in such behavior. Other individuals would not be getting any benefit from their actions; rather they might even be in a disadvantageous position.

b. People believing in Utilitarianism Theory under the category of “Consequentialist Theories” would mark the behavior of Buenrostro and Villalobos morally wrong as the outcomes of their actions are not beneficial to everyone.

People believing in Altruism Theory coming under “Consequentialist Theories” would also label the actions of Buenrostro and Villalobos as morally incorrect since the results of their actions would not be advantageous to everyone except the two individuals.           

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