Faced with losing their fortunes and their status, desperate financiers are being driven to take their own lives
Andrew Clark in New York
guardian.co.uk,
Thursday 8 January 2009 15.49 GMT
One day, they have it all. The next morning, they don't. Sudden, dramatic slumps in fortunes caused by the credit crunch can take a tragic toll on high-flying businessmen accustomed to a life of success.
Germany's fifth richest man, the billionaire industrialist Adolf Merckle, this week threw himself under a train in an act blamed by his family on the "desperate situation" of his business empire, compounded with a sense of uncertainty and powerlessness. Merckle had lost hundreds of millions of euros on a speculative bet in Volkswagen shares.
His act was not an isolated case. There has been a trickle of self-inflicted deaths among financiers struggling to come to terms with heavy losses in a brutal, barely anticipated economic downturn.
At least six documented suicides in the financial industry have been linked to the credit crunch. Experts caution that suicide is never caused by a single factor – underlying mental health problems often play a role, as can substance abuse. But it has become clear that the recession is exacting a human toll.
"Some people have been so successful throughout their lives that they haven't learned through experience how to tolerate loss or failure," says Lanny Berman, executive director of the American Association of Suicidology. "Some people identify their sense of self so rigidly around the concept of success that loss of success – failure – can push them to despair very quickly."
Just days before Christmas, French fund manager Thierry de la Villehuchet was found dead at his desk in New York with slits on his arms. His firm, Access International Advisors, had lost more than $1.4bn of clients' money at the hands of the Wall Street financier Bernard Madoff, who has been accused of fraud. Villehuchet's brother Bertrand, who was the recipient of one of several suicide notes, described his death as an "act of honour" after "catastrophic" losses.
A Bear Stearns analyst, Barry Fox, jumped from the balcony of his 29th floor apartment last year within days of learning that he had lost his job at the bankrupt bank. His partner, Fred Philippi, said that after several personal setbacks, the bank's collapse had been the "last straw" in breaking Fox's spirit.
This week, the chairman of a leading US property brokerage was found with an apparently self-inflicted gunshot wound inside his car at a wildlife preserve near Chicago. Steven Good, chairman of Sheldon Good & Co, left no note and his reasons are as yet unexplained. But he recently spoke at a business conference of the tumultuous conditions facing the real estate industry.
As yet, there are no statistics to demonstrate whether suicide rates have been affected by the global financial crisis. But there are historical precedents – in the US, the rate of suicide reached an all-time peak of 17.4 deaths per 100,000 in 1933, at the height of the Depression.
Researchers say that unemployment has a "clear and direct" relationship with suicide. So does the loss of a home – a concern after a year in which US banks began foreclosure proceedings on more than 2m households.
Ronald Maris, director of the University of South Carolina's suicide research centre, invokes the French sociologist Émile Durkheim's concept of "anomie" – a condition of weakened social regulation during a crisis which leaves individuals feeling adrift.
"A recession can cause a lack of orderliness, a disruption in social control," said Maris, who argues that high-flyers can be particularly vulnerable.
"Their situation is more volatile, they've got a lot more to lose," says Maris. "It's the disruption, the change in lifestyle, the suddenness and abruptness of that transition."
The male-dominated culture of high finance does not help. Both in Britain and America, suicide is three times more common among men than among women, partly because depressed males are less willing to seek medical help. Women, in contrast, are more frequently involved in non-fatal suicide attempts.
The long-term suicide trend has been downward on both sides of the Atlantic. In Britain, the latest government figures showed that suicide dropped to an all-time low of 8.5 per 100,000 population in 2006. In the US, the equivalent rate was 11 per 100,000.
Aware of the danger of burn-out, many Wall Street banks offer confidential employee assistance programs for staff suffering from personal problems. These can include 24-hour helplines offering a referral service for anything from depression to alcoholism, substance abuse or legal problems.
But Alden Cass, a New York-based clinical psychologist who specialises in treating financial workers, says some are reluctant to use such services for fear that word could get back to their colleagues.
"There's a lot of foolish pride. As you go higher up the food chain, you're going to be more tight-lipped about problems and issues," says Cass, author of Bullish Thinking. "If you've lost a lot of money, there can be a sense of shame, of guilt and helplessness going on in peoples' minds."
A year ago, Cass noticed an increase of 25% to 30% in inquiries from frazzled traders and brokers. But the increase has tailed off, which he blames on money: "The money's not there any more for therapy; people are cutting back. Therapy, for a lot of people on Wall Street, is viewed as a luxury rather than a necessity."
In Britain last year, fund management boss Kirk Stephenson jumped in front of an inter-city train after struggling with pressure over the financial crisis's impact on his firm, Olivant Advisers. His wife, Karina Robinson, told an inquest jury that when the banking system seized up, he had become "very tense and worried about a lot of things he had worked hard for".
In certain cases, the credit crunch has exposed a longer term vulnerability. A San Francisco hedge fund manager, Eric Von der Porten, took his own life last month when his fund had dropped by more than 40% on the year. His family told the San Francisco Chronicle that he had struggled with bouts of deep depression in the past, but that the market had finally proven to be a "big trigger".
To some, losing money may seem an insufficient worry for an individual to take such drastic action. But the tipping point can come for any number of reasons according to the AAS.
"Prestige, employment, marital problems, bereavement - anything that happens to be important to that individual," says Berman. "If the individual is not able to balance themself when they fall, they may break."
Germany's fifth richest man, the billionaire industrialist Adolf Merckle, this week threw himself under a train in an act blamed by his family on the "desperate situation" of his business empire, compounded with a sense of uncertainty and powerlessness. Merckle had lost hundreds of millions of euros on a speculative bet in Volkswagen shares.
His act was not an isolated case. There has been a trickle of self-inflicted deaths among financiers struggling to come to terms with heavy losses in a brutal, barely anticipated economic downturn.
At least six documented suicides in the financial industry have been linked to the credit crunch. Experts caution that suicide is never caused by a single factor – underlying mental health problems often play a role, as can substance abuse. But it has become clear that the recession is exacting a human toll.
"Some people have been so successful throughout their lives that they haven't learned through experience how to tolerate loss or failure," says Lanny Berman, executive director of the American Association of Suicidology. "Some people identify their sense of self so rigidly around the concept of success that loss of success – failure – can push them to despair very quickly."
Just days before Christmas, French fund manager Thierry de la Villehuchet was found dead at his desk in New York with slits on his arms. His firm, Access International Advisors, had lost more than $1.4bn of clients' money at the hands of the Wall Street financier Bernard Madoff, who has been accused of fraud. Villehuchet's brother Bertrand, who was the recipient of one of several suicide notes, described his death as an "act of honour" after "catastrophic" losses.
A Bear Stearns analyst, Barry Fox, jumped from the balcony of his 29th floor apartment last year within days of learning that he had lost his job at the bankrupt bank. His partner, Fred Philippi, said that after several personal setbacks, the bank's collapse had been the "last straw" in breaking Fox's spirit.
This week, the chairman of a leading US property brokerage was found with an apparently self-inflicted gunshot wound inside his car at a wildlife preserve near Chicago. Steven Good, chairman of Sheldon Good & Co, left no note and his reasons are as yet unexplained. But he recently spoke at a business conference of the tumultuous conditions facing the real estate industry.
As yet, there are no statistics to demonstrate whether suicide rates have been affected by the global financial crisis. But there are historical precedents – in the US, the rate of suicide reached an all-time peak of 17.4 deaths per 100,000 in 1933, at the height of the Depression.
Researchers say that unemployment has a "clear and direct" relationship with suicide. So does the loss of a home – a concern after a year in which US banks began foreclosure proceedings on more than 2m households.
Ronald Maris, director of the University of South Carolina's suicide research centre, invokes the French sociologist Émile Durkheim's concept of "anomie" – a condition of weakened social regulation during a crisis which leaves individuals feeling adrift.
"A recession can cause a lack of orderliness, a disruption in social control," said Maris, who argues that high-flyers can be particularly vulnerable.
"Their situation is more volatile, they've got a lot more to lose," says Maris. "It's the disruption, the change in lifestyle, the suddenness and abruptness of that transition."
The male-dominated culture of high finance does not help. Both in Britain and America, suicide is three times more common among men than among women, partly because depressed males are less willing to seek medical help. Women, in contrast, are more frequently involved in non-fatal suicide attempts.
The long-term suicide trend has been downward on both sides of the Atlantic. In Britain, the latest government figures showed that suicide dropped to an all-time low of 8.5 per 100,000 population in 2006. In the US, the equivalent rate was 11 per 100,000.
Aware of the danger of burn-out, many Wall Street banks offer confidential employee assistance programs for staff suffering from personal problems. These can include 24-hour helplines offering a referral service for anything from depression to alcoholism, substance abuse or legal problems.
But Alden Cass, a New York-based clinical psychologist who specialises in treating financial workers, says some are reluctant to use such services for fear that word could get back to their colleagues.
"There's a lot of foolish pride. As you go higher up the food chain, you're going to be more tight-lipped about problems and issues," says Cass, author of Bullish Thinking. "If you've lost a lot of money, there can be a sense of shame, of guilt and helplessness going on in peoples' minds."
A year ago, Cass noticed an increase of 25% to 30% in inquiries from frazzled traders and brokers. But the increase has tailed off, which he blames on money: "The money's not there any more for therapy; people are cutting back. Therapy, for a lot of people on Wall Street, is viewed as a luxury rather than a necessity."
In Britain last year, fund management boss Kirk Stephenson jumped in front of an inter-city train after struggling with pressure over the financial crisis's impact on his firm, Olivant Advisers. His wife, Karina Robinson, told an inquest jury that when the banking system seized up, he had become "very tense and worried about a lot of things he had worked hard for".
In certain cases, the credit crunch has exposed a longer term vulnerability. A San Francisco hedge fund manager, Eric Von der Porten, took his own life last month when his fund had dropped by more than 40% on the year. His family told the San Francisco Chronicle that he had struggled with bouts of deep depression in the past, but that the market had finally proven to be a "big trigger".
To some, losing money may seem an insufficient worry for an individual to take such drastic action. But the tipping point can come for any number of reasons according to the AAS.
"Prestige, employment, marital problems, bereavement - anything that happens to be important to that individual," says Berman. "If the individual is not able to balance themself when they fall, they may break."
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