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[no dialogue].
(Justin Paperny). Alright thank you,
thank you very much.
I'll say discussing my crime and the motivations
behind my decisions, the decisions
themselves that led me to prison.
So the toughest thing I ever had to do, it's tougher
than going to prison, it's very difficult.
So I ask for patience, I'm doing my best,
I'll give you an analogy.
Imagine you failed a paper, and your professor said we need to
talk about your F in front of the whole class, in front of all
of your peers on tape no less with everyone listening.
That's in essence what I'm doing, I have the greatest
failure of my life, I choose to discuss day in
and day out and it's quite difficult, and it's
humbling and embarrassing and sickening.
And I say it's sickening because there was no excuse for me to
go to federal prison, I was raised with opportunities and
privileges that most guys in jail can only dream of,
so I have no excuse nor will I offer one tonight.
Now, let's talk a moment about remorsefulness.
Occasionally I get some e-mails from students that say, or even
some professors that say, you didn't seem that remorseful
during your talk, let me be really clear, when I was in my
twenties, facilitating a fraud, getting paid,
hurting people, I wasn't remorseful.
I wasn't, now I'm terribly remorseful and at the end of
this speech if you don't think I am I shouldn't
be invited back and you should send me that e-mail.
Okay, let's talk about my parents for a second,
great parents, I love them.
They love my brother and I so much, however,
there was some tension back in 1993 when my parents divorced.
They divorced in 1993, and for about 10 years
they weren't really friends.
After about 10 years they slowly became friends again, and let's
just say in 2006 when I called them and asked them to
join me for dinner, they still weren't friends.
And I called my parents up on a Thursday afternoon, 2006,
I said mom, dad, you need to meet me for dinner.
My parents said, I'll go but I'm not meeting your mother,
or I'm not meeting your father, we're not doing it together.
And I said mom, dad, you need to go, we need to have a talk.
My parents knew very little what was going on
in my life half the time because I had shut
them out for the prior year for the most part.
So my parents said, we're not going, and I insisted again
and again and again, and finally they agreed.
So about three o'clock they agreed to meet me,
dinner wasn't till eight.
So starting about three o'clock I open up a nice bottle of red
wine, I drank the whole bottle, was smoking, only cigarettes,
only cigarettes at the time, only cigarettes.
Five o'clock I was done with that bottle of wine, I popped
open another bottle, let's go to another of red cab, I had a
decent little collection, I started drinking that too.
I had three more hours till eight o'clock,
a nice build up to my meeting.
So, I was actually so wrecked before dinner that
I couldn't drive, I was drunk, I made a good decision.
So I walked to a restaurant called Daily Grill in Studio
City, about ten minutes from where I grew up in Encino.
It's a little Jewish enclave outside of Los Angeles.
And I walked to dinner and my parents were there before me and
they are sitting on one side, one side and the other there,
and they are looking at each other with not a great look.
And we went to sit down, and I had another bottle of wine, I
started drinking, I started eating, and finally after about
an hour my mother who is very direct said, Justin, why did you
bring us here, what are we doing here, I don't get it?
And she said it again, and I said well
I wanted to talk to you guys.
My mom said the fumbling around isn't working for me, I need to
know why I am here with you and I am here with your father.
And I was pretty trashed now, I was a good two bottles deep, and
I said to my parents very quietly, kind of nonchalantly.
I said, I said like I'm going to prison.
And I kind of covered my mouth a little bit, and my mom said,
$150,000 to go to USC and you can't
speak in coherent sentences.
She says why don't you try it again, she was very direct.
And I said I'm going to federal prison.
And couple other tables around me looked
and I said it very loud.
I said I'm going to federal prison.
And my dad who didn't say much, he doesn't
really say much my father.
He didn't say anything then either, however,
he gave me a look, woo!
My father gave me a look as if all the good I had done the
first thirty years of my life, like it had washed away
and meant absolutely nothing.
My baseball achievements, my academic achievements, my
community service achievements, meant blimpkas, nothing!
This look was awful, I'll never forget it till the day I die.
And he got up and left as soon as I said that.
And my mother who is more of a conversationalist
said for how long, and I said maybe five years,
and she said something I'll never
forget, and something I reference in my work.
She said, thoroughly disgusted, sickening, sickening.
You had all these gifts and abilities, and you took them for
granted and worst, you knew it was wrong,
you always knew it was wrong.
You always knew it was wrong, she said it
again and again and again.
And then she wanted to leave and I said mom, drive me home,
I'm not prepared to walk.
So, I thought long and hard about that, not then but while I
was in prison, the idea of I knew right from wrong.
So this is about much ethical dribble as I'll give you for the
next five or six minutes, but I hope you'll roll with me.
Knowing right from wrong won't, knowing right from wrong doesn't
endow you with the strength to confront all the challenges that
you're going to face in business, I guarantee it.
I promise you, I always knew it was wrong to facilitate a ponzi
scheme, which is what I'll talk about tonight.
Of course I knew it was wrong to facilitate a fraud, you look at
other leaders or once leaders in our community and our society,
someone like Tiger Woods for example, he knew it was wrong to
cheat and betray his wife, of course he did.
Mark McGwire, a former athlete as USC where I played baseball,
you don't think he knew it was wrong to
take steroids in the pursuit of greatness.
We all knew that it was wrong, and the knowledge
in our case wasn't enough, it was insufficient.
And in prison I read the work of Oscar Wilde,
one of my favorite authors.
And he wrote a great deal about temptation, he argued that you
should give into it, but he also said that
he could resist anything but temptation.
And that's what leads a lot of men and women to prison.
It's not knowing right from wrong, it's giving in to that
temptation which is what I gave into again and
again and again as an executive.
Thinking that I had to to keep up with other people.
So I promise you when you are faced with a dilemma in
business, most likely you'll know the right choice,
in fact most dilemmas are not even dilemmas, but it's very
easy to give in and make that wrong decision.
And I didn't think about that while I was an executive, I
didn't think about that while I was facilitating a ponzi scheme.
And when you talk about ethics, I think it's important to ask a
series of questions, and without putting you to sleep,
let's make it practical for a moment.
Guys like me out of prison, professors like Dr. Cisco all
talk about doing the right thing in the classroom,
we all talk about it.
The question is, do any of you have a price, is there
a price that any of you could be bought for?
For example, is responsibility worth something, is integrity?
You're in the business world and someone offers you a $10,000
commission, a kickback for a promotion that you have to say
one thing, you have to sent a text message,
you have to send an e-mail.
Is it worth something to pay that student loan,
or your mortgage, or your insurance?
When I was at USC, I would have said there was
absolutely no way, there was no price for my integrity,
my morality, was not possible.
But the reality is when I graduated USC in May of 1997,
I found myself confronted with some dilemmas,
with some challenges.
And I wasn't totally prepared for them.
When I graduated USC I started working out of a firm,
everyone knew the firm, Merrill Lynch, later swallowed
up by Bank of America.
I was working at Merrill Lynch in Orange County, and at Merrill
Lynch I got off to a very good start working a ton of hours,
probably too much work, 70, 80, 90, 100 hours a week.
Progressing cold calling day and night, that's all I was,
I was a cold calling stock broker.
Bothering you at home, convincing you to do a trade.
Well after about a year at Merrill Lynch, I had made my
first $100,000, I had raised nearly $10,000,000 in assets,
and I was very much working on my own.
Moving to that first year and a half at Merrill Lynch, I came
across a situation where I really wanted to qualify
for my first $10,000 bonus, a big bonus.
It's a lot of money, it will always be a lot of money.
And in order to qualify for this bonus,
I had to do 40 financial plans.
In other words, I would go to your home and tell you for $250,
I'll do a detailed financial worksheet on your life.
If you want to have $10,000,000 at the age of 60,
this is how much money you have to save.
40 plans to qualify for a $10,000 bonus.
I worked day and night to get there, as much as I could.
Every prospect, every client, telling them
they need this plan.
I really believed in it, I really did.
With a week to go I had done 37 plans, 3 more to get 10 grand.
Three more plans and they only cost $250.
So I was in my branch manager's office one day, lamenting,
telling him that I could really use the bonus and I'm so close,
yet there's no way that I could get three more,
it's not going to happen.
My branch manager said, well let's talk about this for a
second, let's reason our way through it.
And I said, okay, well what do you have in mind?
My branch manager said to me, well, if you were to buy three
plans for your clients at $250 a piece, you'd then get to 40 and
qualify for the $10,000 bonus.
And I said well can I do that?
He said I don't see why not, it's your money,
you can do with that as you choose.