IN GOOD FAITH

A hit-or-miss recap of events leading up to a 1993 decision by Prudential Securities to settle fraud charges with the SEC, albeit without admitting guilt, from a journalist who is not up to the job of explaining, let alone illuminating, a perdurable scandal. Drawing mainly on secondary sources and interviews with a handful of minor players with axes to grind, Sharp offers a rough idea of the trouble Prudential Insurance bought with its 1981 acquisition of Bache, a second-rate Wall Street brokerage firm. A financial force to be reckoned with, Pm has 140-odd subsidiaries, vast resources, and an enviable consumer franchise (reinforced by its familiar Rock of Gibraltar logo). For all its assets, the mutual insurance company's foray into retail brokerage proved a disaster. Bache's stock in trade was limited partnerships, which its registered reps hawked as tax shelters with high-yield investment appeal. Although federal tax law changed during the mid-1980s, Pm-Bache's venal, high-pressure tactics did not; tens of thousands of clients were duped into buying inappropriate and economically unsound LPs. Lawsuits were filed, and regulatory authorities eventually got into the act, but not before $5 billion was lost. In her first book, Sharp attempts to tell this sorry tale through low-echelon hucksters who either left or were dismissed by the firm and a few investors who lost money on Pm-Bache deals. Her approach will leave most readers puzzled as to whether the corruption was systemic or attributable to a few rogues (as the parent organization still insists). The narrative's clarity also suffers from the author's bent for going off on tangents. At no point does Sharp probe the cultural differences that make buttoned-down insurance underwriters and freewheeling brokerage houses strange bedfellows in the first place. A dispensable take on fiscal misdeeds that await perceptive coverage.