2 from Y. win ethics contest

PROVO — When you're visiting family this season and talking among yourselves, here's a topic: Is it ethically acceptable to offer mortgages to illegal immigrants?

It's the subject of bitter political battles and ongoing debate within the banking industry. And while it's most likely to be a total conversation killer in most circles, a pair of Brigham Young University students recently won an international competition by taking the question to task.

Philip Arias and Sarah McMullin, a pair of undergraduates at BYU's Marriott School of Management, took home first place from the Eller College of Management's 2006 International Ethics Case Competition, hosted by the University of Arizona. The two were selected to represent BYU from roughly a dozen students who applied.

The BYU team beat 20 other teams from top business schools in the United States, China, Canada and Mexico, all given the same difficult topic to struggle with.

"Frankly, when I first heard it, I thought 'Nope, no way,"' McMullin said.

McMullin said her partner initially embraced the idea, but they both changed their minds regarding the question a couple of times as they went through the week of preparation they had prior to the competition.

"It just kind of depended on what aspect each of us was researching at the time," McMullin said.

Ultimately, the pair concluded that the idea was not only ethically sound, but also made good business sense.

"It's a really hot topic right now in the banking industry ... basically, we defined it as a moral free space," Arias said. "That means it's an issue that's still being decided, so it's important for the banks to play a role in shaping that."

From an ethics standpoint, McMullin said, granting mortgages to illegal immigrants serves individuals by giving them a place to live, and serves the community by reducing vacancy rates and increasing property values.

On the business side, Arias pointed out that banks that provide mortgages to illegal immigrants would also be able to get in on the remittance market and make money by providing wire transfer services to clients who are sending money to family back home.

However, the two also cautioned in their presentation that banks should only grant such mortgages on a limited basis and carefully follow laws that govern the practice, such as the Patriot Act.

The competition was fairly intense, but after refining their presentation with professors, both said they didn't feel very nervous on the big day.

"We practiced it so much that it was kind of like basketball; you know the plays, you know what's going on and the words just kind of came out of my mouth," Arias said.

Assistant professor David Hart, who advised the duo, said the students' hard work made for a dominating performance at the competition.

"There was no question that they were the best," he said.

Students placed a bit of pressure on themselves to be good ambassadors for the university but said it wasn't too much.

"We wanted to represent BYU well, but our professors didn't say we were going to walk home if we didn't win," Arias explained with a chuckle.

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E-mail: jtwitchell@desnews.com