Bankers and investors need to ensure they don’t repeat “bad behaviors” that contributed to the credit crisis as the financial-services industry embraces greater risk, said Richard Handler, chief executive officer of Jefferies Group LLC.

“People who take short cuts, are political, prioritize themselves above others, take excessive risks for personal gain, don’t value capital, or are unethical are outright cancers,” Handler, 53, also CEO of Jefferies’s parent company, Leucadia National Corp., said in his quarterly letter to clients. “These types of people will not only flourish in the next crisis, but most probably they will cause it.”

Almost seven years after a housing bubble triggered the worst financial crisis since the Great Depression, lawmakers continue to urge the biggest U.S. banks to reduce leverage and risk-taking. President Obama said on July 3 that the bonus- driven culture of Wall Street trading desks still encourages risky behavior and that his administration will look at “additional steps” to rein it in.

Bankers need to surround themselves with partners who help them “restack the common-sense walls,” and a firm that is transparent and honest, Handler said. While leverage can be useful, it’s easy to get “lulled into a false sense of purpose” at a time when the industry is starved for yield, Handler said.

“We all may want to have our eyes wide open regarding the risk that is clearly starting to make its way back into our system,” Handler said. While leverage “does an incredible job of amplifying the good, it does not know its master and is equally capable of magnifying the bad.”