Still Bankstering - And Why Not?

The banksters were not just let off the hook for bringing the world economy to its knees with their corrupt practices back in 2008, they were encouraged and rewarded with taxpayer treasure.

THE unfolding story of how Barclays — and, in all likelihood, other big banks — rigged interest rates is full of telling tidbits about the way Wall Street works.

By now the world knows that Barclays manipulated the most widely used benchmark rate, the London interbank offered rate. But Barclays is just one member of the cozy club that sets the Libor, which is supposed to be based on the average rate at which large banks can borrow money overnight.

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Manipulating the Libor is a big deal because it affects the cost of money for almost everyone. The Libor is used to set rates on mortgages, credit cards and all manner of loans, personal and commercial. The amount of money affected by the phony rates is at least $500 trillion, British regulators have estimated.

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Last week’s defenestrations of Marcus Agius, the Barclays chairman; Robert E. Diamond Jr., its hard-charging chief executive; and Jerry del Missier, its chief operating officer, apparently occurred at the behest of the Bank of England and the Financial Services Authority, the nation’s top securities regulator.

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MR. DIAMOND seemed shocked to be pushed out. An American by birth, he probably thought he’d be subject to American rules of engagement when confronted with evidence of wrongdoing at his bank. You know how it works on this side of the Atlantic: faced with a scandal, most chief executives jettison low-level employees, maybe give up a bonus or two — and then ride out the storm. Regulators, if they act, just extract fines from the shareholders.

British officials are taking a different approach with this scandal. George Osborne, the chancellor of the Exchequer, was direct in his assessment of Barclays’s activities. “It is clear that what happened in Barclays and potentially other banks was completely unacceptable, was symptomatic of a financial system that elevated greed above all other concerns and brought our economy to its knees,” he said in a statement on June 28. “Punish wrongdoing. Right the wrong of the age of irresponsibility.”

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A bill intended to gut the commission’s proposed rule and to maintain dealers’ profits in derivatives failed to go anywhere after being passed last year by two committees in the House of Representatives — Financial Services and Agriculture. That was a good thing.

But there are rumblings in Washington that this bill has resurfaced and that it may be quietly attached to a House Agriculture Committee appropriations bill scheduled for a vote this month.

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It’s hard to believe, in the wake of the Libor mess, that Wall Street and its supporters in Congress would continue to battle against price transparency in any market. Then again, that’s precisely what they did after the credit crisis.

  NYT

In addition to the British action against Barclays, a Spanish court recently announced what appears to be a serious criminal investigation of the head of that country’s largest mortgage bank (also a former IMF Chairman) for mortgage fraud and price-fixing.
  Glenn Greenwald

But not here.

This kind of accountability is virtually inconceivable in the U.S. Many people love to hail President Obama for ending torture and CIA black sites; aside from the reasons that’s untrue in its own right, the reality is the opposite: by so aggressively shielding the torturers from all forms of legal accountability (criminal, civil and international), the incentive has been created to do it again. The same is true of illegal spying, and systemic financial fraud, and all of the other elite crimes over the last decade that wreaked such destruction.

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It’s why none of the perpetrators of America’s worldwide torture regime or its systematic warrantless eavesdropping on Americans or the deliberate destruction of incriminating evidence has faced an iota of legal accountability. It’s why the 2008 Congress passed a law that had no purpose other than to retroactively shield the nation’s telecom giants from all liability for their role in the illegal spying. It’s why a bipartisan cast of prominent political officials feels free to openly receive money from and to offer material support to a designated Terror group (MEK) without the slightest fear of punishment, even though ordinary, powerless Muslim Americans have been severely punished for giving far less support to designated Terror groups. The single most remarkable (and revealing) fact of the Obama presidency may very well be the lack of a single prosecution of Wall Street executives for the massive fraud that precipitated the 2008 financial crisis.

...but hey, do what you want...you will anyway.