Thursday 21 May 2015

Gaol the Bankers [Again]

A good few years ago I sat my SFA, and then FSA exams.  For those who've not had the pleasure they are multiple-choice questions, and by way of prep my ever-helpful kids used to delight in testing me on long car journeys.  Not much of the regulatory stuff remains in the memory, it is pretty dry, but one thing I do recall:  under the regimes of those days there was a slew of misdemeanours for which the maximum penalty was  

2 years' imprisonment and an unlimited fine

And two years is for the 'technical' offences: you can get more than that for theft etc.

So here we are in 2015, eight years after the banking crisis started and financial wrongdoing / failure of governance ceased to be a joke.  Somehow, the bastards escaped gaol then, just conceivably because the place was in meltdown and all hands were needed on deck.  But any excuse for leniency is long since over.  And white-collar people really don't want to serve time.

So as FX rigging follows LIBOR rigging, where are the mass criminal prosecutions ?  The FCA has replaced the FSA and, I wondered, maybe the penalties have inexplicably been reduced since my day?  A quick search under 'imprisonment' in the FCA handbook reveals that this is not the case, it's still

2 years' imprisonment and an unlimited fine

For the nth time: I'm a capitalist, these people have their hands on my money, it's important, I want them banged up!



DJK said...

Absolutely. Catharsis requires a few bankers thrown in the clink. Yet on the R4 business news at 6:20 this morning we had a discussion about the fines for fx market rigging and the point was made that this would only stop if penalties were applied to individuals, only for the reply to come that there was no evidence of criminality, only of rule breakage.

DJK said...

I'm still fuming remembering the smug complacency of the president of the British Bankers' Association, on the radio five years ago after RBS went bankrupt and had to be rescued. He thought it quite natural that every man, woman and child in the country should stump up £1000, not only to bail out RBS but to honour all staff contracts, including the pension that allows Fred Goodwin to live like a Medici prince. ("Sanctity of contract, old boy".)

Anonymous said...

Perhaps that is why we have "the bash the immigrant" orchestrated press appearances today.

Nothing better than a dog whistle.

Steven_L said...

But have they committed offences? Sure, it is an offence to carry on a regulated activity when not authorised, provide false information to regulators, auditors etc.

But once you are authorised, you come under the 'rulebook' (or sourcebook) and breaking the rules isn't a criminal offence, its just something the FCA can hand out fines / bans etc for.

Of course, if a few people have conspired to defraud other folk or actually defrauded other folk by giving them false information or abusing their position of trust then that is criminal and it is a 10 year max matter.

But fraud is prosecuted by the Police/CPS and the SFO seem to be led by some sort of baffoon intent on their total destruction.

Fraud isn't prosecuted because too many people in high places make a living out of it. I've seen example of Peers and senior government officials/advisors/political donors being involved in boiler room pensions liberation fraud and diddly squat gets done about it.

I wonder why?

Bill Quango MP said...

Sometimes we pussyfoot about. seeking the exact definition o f 'responsibility' within a deliberately undefined role.

It might be better to take a more 3rd world approach once in a while.

A bofors 40mm or perhaps a US M45 quad .50cal browning AA gun might just put the matter to the rest and discourage others.

CityUnslicker said...

The UK is much more corrupt than people realise. As we can see from MP expenses and these City scandals it is endemic.

Where is the teaching of right and wrong in our culture. I feel moral relativism taught in schools since the 1970's has a lot to answer for.

DJK said...

CU: Not sure that corruption --- which exists rather more than people think --- is any worse now than in the days of T. Dan Smith or Maundy Gregory or Robert Clive.

Blue Eyes said...

BQ, don't we have common law for exactly this?

Sackerson said...

Hooray, Nick, yes!

Electro-Kevin said...

It won't happen.

Does a statute of limitations prevent this after a certain while ?

hovis said...

CU: We are more corrupt than people wish to recognise - it harms their self image.
I was talking with some clients at a Ghanian bank and they were bemoaning corruption, I had to put the UK in context and explain our corruption is softer, less blatant and more insidious than what they are used to.

DJK:I don't think teh claimn is we've never been corrupt, just that we have been less so. Clive was a pschopathic thief, Maudy Gregory the poster boy for the rot that came with Lloyd George, T. Dan Smith the exemplar of the corruption of post war municipal Britain. I would suggest the 'golden age' being a certain morality in the public conciousness and the sweeping away of old privilidge so from 1860/70s - 1890's things looked more promisiong before falling off.

Anonymous said...

Re - "the bash the immigrant day"

I think this is fucking shameful. I want immigration controlled, and I voted UKIP, but most of the EU migrants aren't here for the benefits, they're here to work.

The whole smokescreen about benefits is simply to try to hide the fact that Cameron can do fuck all about the freedom of movement issue.

If you want to see where the benefits / immigrants issue overlaps look at the Somalis, Bangladeshis and Pakistanis, as according to the IPPR report, they're the ones with the highest levels of economic non contribution.

Elby the Beserk said...

And so surely say all of us. I would add that the the concept of "accountability" seems to have gone missing everywhere at the top of big business - and in the public sector.

As the Taxpayers Alliance have pointed out - the disaster that was Mid-Staffs Morgue made millions for some of their staff.

"Today the TaxPayers' Alliance can reveal that clinical staff at the Mid-Staffordshire and University Hospitals of Morecambe Bay (UHMB) NHS Trusts were awarded more than £7 million in "Clinical Excellence Awards," whilst official inquiries found that patient care was seriously deficient - leading to shocking patient care and even unnecessary patient deaths.

Freedom of Information Requests, submitted by the TaxPayers' Alliance, have revealed:

At least 259 Clinical Excellence Awards were given to staff at UHMB NHS Trust between 2005 and 2012, totalling just shy of £4 million. The total is likely to be higher, as the Trust has provided incomplete details for 2005-2008

170 Clinical Excellence Awards were awarded to staff at Mid-Staffordshire NHS Trust between 2006 and 2010
Mid-Staffordshire officials refused to reveal the average value of the bonuses awarded. At the national average value of £18,860, 170 awards would total £3.2 million - the real total could, of course, be higher."