Sunday, July 15, 2012

Banks = Bank Thieves?

Another huge financial scandal has been settled, where credit card companies & major banks have agreed to pay retailers up to US$7.25 billion for price fixing. It's likely the largest antitrust settlement in history. (WSJ link)

This just after we learn giant international banks manipulated the LIBOR rate at our expense.

Ultimately and systematically, big finance screws you.

The collusion of these corporations is terrible. Is it criminal? Will hundreds of bankers & finance industry insiders be imprisoned soon for corruption?

Of course not! The corruption is part of the system. Many of the regulators are former or future employees of key financial firms. Some are related by family ties. We can expect no accountability for their 'ignorance' - which all surely deeply regret. Typical format is fines paid by companies, which avoid admitting guilt.

Note the embarrassing family link between former NASDAQ Chairman Bernie Madoff & the Securities & Exchange Commission, where SEC compliance official Eric Swanson married Madoff's niece Shana (she was a compliance lawyer for Bernard L. Madoff Investment Securities firm, her dad was Chief Compliance Officer). Corruption, compliance shortcomings and poor regulation helped Madoff & Co. launder tens of billions of dollars. But wrongdoing by most of his cronies & family co-workers is unproved, no charges have been filed - we're told nobody but Bernie knew nothing...