At least, that’s the message that keeps getting sent when one pays attention to what’s happening in the financial industries:
Traders who were rigging the £3.5trillion-a-day foreign exchange market boasted to each other about making ‘free money’ in a scandal that has today cost five banks a record £2billion in fines.
The bankers, who called themselves as the ‘A-Team’, ‘Three Musketeers’ and ‘The Players’, colluded online by sharing sensitive information to make millions for their banks and bag big bonuses themselves.
Other messages reveal how the cartel feared being caught, telling eachother on forums: ‘Don’t want other numpty’s in mkt to know… is he gonna protect us like we protect each other?’
State-owned Royal Bank of Scotland has been fined £217million ($344million) by the London-based Financial Conduct Authority (FCA) as well as £182million ($290million) by the US Commodity Futures Trading Commission (CFTC).
The others involved in the settlement are Citibank, HSBC, JPMorgan Chase and UBS, who will also pay up to £500million each. Barclays said it continues to hold discussions with regulators.
More than 30 traders have been fired, suspended, put on leave, or resigned since the probes started, and the Serious Fraud Office has launched a criminal investigation – but there have been no arrests.
Why is that? Why is it that police will confiscate the life savings of an ordinary citizen on a whim, without bothering to establish any criminal activity, but bankers and financiers can break all regulatory law and simply write off a negotiated fine as the cost of doing ‘business?’ (Wouldn’t it have been informative if the media had bothered to figure out what small percentage these ‘fines’ represented, compared to the billions in illegal gains? I’m betting it’s a mere rounding error, and it’s no accident such context is lacking in the coverage.)
This is not an isolated story, and is yet one more example of why I get irritated with people who look at conditions today and consider it an indictment of capitalism. We don’t HAVE capitalism today. We have corporatism — a condition in which well-connected interests such as the financial sector have coopted the very regulators that are supposed to constrain their ability to use their position to screw the common man. This is another reason I said yesterday I’m no longer convinced we live in a free country. Not when this kind of thing is considered ‘justice.’
In recent years we’ve seen the robo-signing scandal (which, in a just world, would have resulted in the voiding of ALL affected mortgages), large banks found guilty of laundering money for criminal syndicates (professional courtesy, it would seem), and now this.
As Karl Denninger is fond of saying, “where are the handcuffs?” Not to mention the long stretches in a general prison population for these captains of industry, not some Club Med Behind Bars. This is why there is no trust in government OR the business world today. And rightfully so. Nor SHOULD there be any until some “big fish” are held to hard account, with a clear message this flaunting of the rule of law will no longer be tolerated. These banks keep claiming in recent years they are “too big to let fail.” Fine. Maybe the government that currently coddles them needs instead to seize and auction them off in smaller parcels to people who will compete fairly in a market environment, rather than create oligarchies. Come to think of it, that would help considerably with some other issues, too… like our national debt.
That would, however, require government to be interested in justice, rather than cronyism. And that will only happen, dear reader, when YOU demand it.
(HT: Vox Day)