Scandal detours trip along the high road.

• Author: Speizer, Irwin
• Position: Tar Heel Tattler

"Standards of governance and ethics are the rocks upon which we build the legitimacy of our business institutions. When governance and ethics falter--or are cast aside in pursuit of financial results--to paraphrase the poet William Butler Yeats, the center cannot hold. Things fall apart."

That was Ken Lewis, chairman and CEO of Charlotte-based Bank of America Corp., at the corporation's annual meeting in April. The bank had avoided major damage from the Enron scandal that tarnished J.P. Morgan Chase and CitiGroup. But Lewis now finds BofA engulfed in a widening mutual-fund scandal.

There is no hint that Lewis or any members of top management were complicit in the dubious trading deals. The question, though, is how such practices could have flourished in the ethically upright environment Lewis has been championing. Part of the answer may be in the conflict he set up by urging his minions to play nice while lashing them to bring in more profits.

In September, New York Attorney General Eliot Spitzer lodged fraud and deception charges against BofA broker Theodore C. Sihpol III, accusing him of participating with Canary Capital Partners hedge fund in a scheme to conduct illegal late trades and questionable market-timed trades in the bank's Nations Funds mutuals. In...