After the media uproar about HSBC’s deep involvement in the dirtiest sort of money-laundering, UBS’s mere Libor-fixing might look a tad pale. But the notice by the FSA clearly states that it regarded UBS’s conduct as far worse than that of Barclays, where the chairman, CEO, and president all stepped down.
Read more...Our Treasury Secretary, also known as the Bailouter in Chief and “Foamy,” has a default explanation for why ordinary citizens must bend over every time banking interests are threatened. The more formal statement of this policy is the Geithner Doctrine, which is “nothing must be done that will destablize the banking system.” However, Geithner also subscribes to the Humpty Dumpty School of Language, in which words mean what he chooses them to mean, nothing more or less. So “destabilize” means “hurts the profits or reputation of” and “banking system” means “any bank that is pretty big and/or well connected”.
Read more...Even though the executive branch of the English government has as much of a soft spot for its banks as America’s does, its regulators are less craven than ours (admittedly, ours set such a low standard that it is not all that hard, and the UK’s relative advantage may be about to go into reverse with the appointment of the new head of the Prudential Regulation Authority, since the designee presumptive believes big banks can’t be prosecuted).
Read more...NC readers can find some of the background on Nikki Turner’s story here. 18 months later, five years after her own business was destroyed, and a full decade after the very beginning of the HBOS fraud story, she is still waiting for the police investigation to lead to a prosecution. Mrs Turner’s open letter was […]
Read more...Neil Barofsky met with several Occupy Wall Street working groups Sunday for nearly two hours. Barofsky is relaxed, thoughtful, and direct a Q&A format.
One of his major themes was that the unwillingness to mete out meaningful punishments to miscreant banks means that the authorities are providing incentives to engage in criminal activity.
Read more...I’ve read the Department of Labor complaint of former Deutsche Bank employee Eric Ben-Artzi that, among other things, alleges that the German bank violated SEC, GAAP and IFRS (International Financial Reporting Standards) requirements and probably also Sarbanes Oxley, and have had follow up conversations with him and his counsel. The charges are specific and sufficiently well supported to merit serious investigation. In their efforts to dismiss his charges, defenders of the bank’s position overlook the public reporting requirements for complex financial transactions like the one in question, a leveraged super senior (LSS) trade. Nor does their Panglossian “everything worked out for the best” argument stand up to scrutiny.
Read more...American Banker has an article up that is astonishing in that it tells us that the main regulator of national banks, the OCC, has confirmed one of our ongoing complaints: that the controls at the biggest banks are inexcusably weak. The OCC is the last place you’d expect to hear this from; historically it’s been a major enabler of banks playing fast and loose with the rules. And the implication is that bank execs should be wearing orange jumpsuits rather than getting multi-million pay packages.
Read more...By Neil Barofsky, former Special Inspector General for the Troubled Assets Relief Program, currently a senior fellow at the NYU School of Law and the author of Bailout. Cross posted from The New Republic with author permission
You can be forgiven if you watched the Department of Justice’s announcement yesterday of a $1.92 billion settlement with HSBC with a sense of disappointment–and déjà vu.
Read more...Occupy the SEC submitted an amicus brief in Gabelli v. SEC, a case before the Supreme Court. The plaintiffs are appealing a Second Circuit decision over the issue of the statute of limitations.
Read more...Believe it or not, sometimes I’m not cynical enough.
Read more...By Matt Stoller, a fellow at the Roosevelt Institute. You can follow him at http://www.twitter.com/matthewstoller
This is a straight up admission.
State and federal authorities decided against indicting HSBC in a money-laundering case over concerns that criminal charges could jeopardize one of the world’s largest banks and ultimately destabilize the global financial system.
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In my last post on Basel III, I suggested that we would soon see a silly game played out over the coming months whereby banks on either side of the Atlantic would alternate in securing more and more concessions on Basel III until the whole thing became manifestly pointless and got sidelined.
In fact it is all happening rather faster than that.
Read more...By Michael Hoexter, a policy analyst and marketing consultant on green issues, climate change, clean and renewable energy, and energy efficiency.
What is happening now in American politics surrounding the political theater called “the fiscal cliff”, must be understood with the utmost clarity because, in part, the organizers of what James K. Galbraith aptly calls a “scam” are counting on confusion and rash action to complete their scheme. If we can understand what is going on with greater clarity, we may be able to highlight to more people the import of the events occurring and hopefully short-circuit the efforts of politicians to damage the social safety net and the economy more generally.
Read more...It seems the Federal Government has finally woken up and is making a show of being serious about one type of bank misbehavior, that of money laundering. The striking element about the agreementwith various Federal agencies and the Department of Justice is that nearly $1.3 billion of the $1.9 million fine comes in the form of a deferred prosecution agreement.
Read more...Matt Stoller is a fellow at the Roosevelt Institute. You can follow him at http://www.twitter.com/matthewstoller.
In the comments of my last post on the SEC nomination issue, director of investor protection for the Consumer Federation of America, Barbara Roper, laid out a rationale for different choices at the SEC. R
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