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Interest From a Borrower to a Lender: Balancing Formal and Reasoned Halachah

I recently had occasion to discuss a crucial detail of the laws of interest, that it is only prohibited if the interest goes from the borrower to the lender. An interesting topic of its own, it also opens a broader question of whether to treat halachah formally or with an eye out towards some sense […]

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The Jewish Ethicist: Con or crunch?

Lenders deserve to know if a shaky lender has misled them

Question: A person I know is going around borrowing money for his business. I happen to know that his business is not going so great, so there is a good chance lenders may not get their money back. I feel like I should inform them, but I’m afraid that if I tell people I will actually be precipitating a failure and do more harm than good to the lenders.

Answer: Your question is a twist on the usual dilemma involving damaging disclosures. Let’s examine the usual situation:

The Torah commands us, “Don’t go about as a talebearer among your people; don’t stand idly by the blood of your neighbor.” (Leviticus 19:16). The first half of the verse prohibits slander or any other kind of damaging revelation about others, but the second half tempers that prohibition: Our concern for the reputation of the wrongdoer shouldn’t induce us to stand idly by when someone is liable to suffer a loss from his actions.

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The Jewish Ethicist: Charitable Investment

Can I invest charity money in a sure-fire investment?

Question: I’m the head of a non-profit organization. The organization has some spare cash that I am convinced I can invest at a profit. Should I go ahead and benefit my organization in this way?

Answer: The Talmud has an interesting discussion regarding the propriety of investing charity funds.

Rabba asked Rav Yosef: What do we do with orphans’ funds? He said, we deposit them in court, and distribute them little by little. He said, then you exhaust the capital! He said, what then should we do? He said, we investigate a person who has known assets [to collect from in case he should lose the deposit], and deposit their money with him near to profit and far from loss [the active partner splits profits but bears all losses]. . . That’s very well if we find someone who has certain assets, but if we can’t find someone who has certain assets shall we let the orphans’ funds dissipate? Rather, Rav Ashi stated: We find a person of stable property, reliable, who is obedient to the Torah and is not under a ban, and we deposit it by him in court (Bava Metzia 70a).

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The Jewish Ethicist: Upcoding

Helping the needy is praiseworthy, but it can’t justify deceit.

Question: Insurers insist that every procedure be reimbursed according to its code. But sometimes a procedure that usually takes five minutes takes an hour. Can’t I record a higher-level code in order to get fair recompense?

Answer: The practice you describe is often called “upcoding” – recording a code for a procedure more expensive than the one the patient needs. It is recognized as a form of insurance fraud, or if the insurer is the government as a form of defrauding the government.

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The Jewish Ethicist: Tycoon Traders II

Last week we discussed whether traders are engaging in socially worthwhile work, as opposed to some kind of rip-off. Based on the evidence I am aware of, I wrote that traders seem to be engaged in a job like any other, earning a salary based on performance which results from a combination of skill and luck.

Some people may be willing to grant this point, but still feel that at some stage salaries become “obscene” or “excessive”. In the US, there is legislation limiting how much salary can be considered a legitimate business expense. (Ironically, this supposedly “salary limiting” legislation is partially responsible for the compensation system of traders, who get a low base salary partially for this reason.)

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