Houston Seven years after the wheels started coming off the bank’s mad money train, it seems clear that settlements for mortgage abuse, which is euphemism for fraud, Dodd-Frank legislation, and what should have been the awesome weight of having collapsed the US and world economy and upended the lives of millions, have essentially been water off a duck’s back for the banking industry and Wall Street.
Let’s just tick off a few recent cases in point.
- The City of Los Angeles, yes, not the Justice Department, SEC, or Federal Reserve, sued Wells Fargo for pressuring employees in its retail bank with sales quotas to fraudulently enroll people in new customer accounts without their approval. Plain and simple, shake and bake, no permission needed.
- Two big banks rather than settling for some hand slaps and big fines, Nomura, a Japanese bank, and the Royal Bank of Scotland, both presumably figuring their home country customers probably didn’t give much of a flip about whether or not they had packaged bad mortgages in the USA, went to trial claiming the dog-ate-their-homework, the economy did it, not them. The judge found against these miscreants and essentially said their behavior was disgusting.
- And of course there is the whole cabal of banks that engaged in price fixing and chicanery to fudge the LIBOR rate for interbank and corporate lending including HSBC, JP Morgan Chase, Citi, and a rogues’ gallery of the biggest banks in the world. Their fines are in the billions, and reportedly they are going to finally have to actually plead guilty as institutions.
Many have argued that part of the problem was the legal double standard that found law enforcement playing paddy cake with the criminal enterprise that banking has become rather than prosecuting them aggressively from the top down. If anything was administered more than simple detention, it was from the bottom-up. The bigger the guy at the top of the bank, the bigger and more obscene the paycheck continued to be.
More proof that bad behavior and thuggery is the norm in banking is emerging in a new study as well. According to the Andrew Ross Sorkin at The New York Times,
“...about a third of the people who said they made more than $500,000 annually contend that they ‘have witnessed or have firsthand knowledge of wrongdoing in the workplace.’ Just as bad: ‘Nearly one in five respondents feel financial service professionals must sometimes engage in unethical or illegal activity to be successful in the current financial environment.’”
Such statements take your breath away. Not only has it not gotten better, it may have gotten worse! And, the President wonders why Senator Elizabeth Warren is willing to go to the wall on a trade bill that had hardly interested her until she noticed the language leading her to believe that it would allow even more transnational banking criminality?
There oughta be a law, but there probably are plenty of them, just no one seems to care, and the party goes on, and we all pay for it.
The Beermats – A Workers Song