The End of the World? Probably not. The end of banking regulations as we know them? Almost certainly
It seems that in the world of banking, it’s now a question of get as big as you can and then do as you like. You see, the bigger the bank failure, the harder the hit on the world’s financial system. And four years after the Lehman Brother debacle, American authorities are signaling that big banks can do whatever they please.
Take the case of HSBC. Just a couple of weeks ago it was handed a $1.92 billion settlement. And what this meant was that it avoided indictment on charges of money laundering, transferring billions of dollars for nations like Iran, and helping Mexican drug cartels to move money through America. A few dollars to pay – certainly in terms of the amount of money the bank may have made out of its illegal operations – and then business as usual.
HSBC isn’t the first bank to avoid the wrath of the criminal courts. Over the past few years six other foreign banks have been handed ‘settlements’. Banks such as ING, Barclays, Credit Suisse, and Standard Chartered have been moving billions of dollars around the world for countries such as Cuba, Sudan, and Iran.
Have you ever tried to transfer $10,000 or more, and been requested to produce all sorts of paperwork for money laundering purposes? Well it seems that these rules don’t apply to real big money. Big banks can move money at will, and never be threatened with jail.
And it doesn’t stop there. Just this week, UBS has fessed up to fixing Libor rates on products worth trillions of dollars through to 2009. Has the Department of Justice taken their sword to the bank? No. What has happened is that UBS looks likely to pay $1.5 billion in settlements to UK, US, and Swiss authorities and a Japanese subsidiary of the firm will plead guilty to a US criminal offense, therefore keeping the main bank safe.
Of course, there have been low level traders fired across all the banks concerned. But, surely, the big boys – Chairmen, CEO’s, and CFO’s – will have known about their banks’ operations? If not, the question has to be why not. And if so, the question has to be why they are still employed.
Either the banking system around the world is not functioning properly, or it is run by a bunch of liars, cheats, and swindlers.
The saddest thing is that the American authorities have signaled they don’t have the spine to deal with the root cause of the problem. Big banks used to be too big to fail. Then they became too big to bail. Now, it seems, they are too big to jail.
Take the case of HSBC. Just a couple of weeks ago it was handed a $1.92 billion settlement. And what this meant was that it avoided indictment on charges of money laundering, transferring billions of dollars for nations like Iran, and helping Mexican drug cartels to move money through America. A few dollars to pay – certainly in terms of the amount of money the bank may have made out of its illegal operations – and then business as usual.
HSBC isn’t the first bank to avoid the wrath of the criminal courts. Over the past few years six other foreign banks have been handed ‘settlements’. Banks such as ING, Barclays, Credit Suisse, and Standard Chartered have been moving billions of dollars around the world for countries such as Cuba, Sudan, and Iran.
Have you ever tried to transfer $10,000 or more, and been requested to produce all sorts of paperwork for money laundering purposes? Well it seems that these rules don’t apply to real big money. Big banks can move money at will, and never be threatened with jail.
And it doesn’t stop there. Just this week, UBS has fessed up to fixing Libor rates on products worth trillions of dollars through to 2009. Has the Department of Justice taken their sword to the bank? No. What has happened is that UBS looks likely to pay $1.5 billion in settlements to UK, US, and Swiss authorities and a Japanese subsidiary of the firm will plead guilty to a US criminal offense, therefore keeping the main bank safe.
Of course, there have been low level traders fired across all the banks concerned. But, surely, the big boys – Chairmen, CEO’s, and CFO’s – will have known about their banks’ operations? If not, the question has to be why not. And if so, the question has to be why they are still employed.
Either the banking system around the world is not functioning properly, or it is run by a bunch of liars, cheats, and swindlers.
The saddest thing is that the American authorities have signaled they don’t have the spine to deal with the root cause of the problem. Big banks used to be too big to fail. Then they became too big to bail. Now, it seems, they are too big to jail.
