Are British Banks Bankable?

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ARE BRITISH > Libor scandal More than a dozen banks are under investigation by BANKS BANKABLE? authorities in Europe, Japan and the US over suspect- ed rigging of the London Interbank Offered Rate Royal Bank of Scotland (RBS) would (Libor). Barclays has already been fined $451 million by pay £390 million to US and British British and US regulatory bodies for its part in manip- authorities to settle allegations it ulating Libor rates. The scandal also affected RBS, manipulated benchmark interest Lloyds and HSBC in Britain and Swiss bank UBS rates. To avoid a public backlash, the > Mis-selling interest-rate hedging products British bank said it was cutting Last month Britain’s FSA said it found in the 173 bonuses to help pay the fine. A look interest-rate swap test cases it had examined, about at some of the scandals that have 90 per cent did not comply with regulatory engulfed banks requirements. So far, Barclays has taken the highest in Britain provision, setting aside £450 million for compensation, HSBC about £150 million and RBS £50 million > Mis-selling insurance Usually, payment protection insurance policies were offered to those taking a personal loan or mortgage to cover repayments, if clients were taken ill or lost their jobs. However, the policies were often sold to those who did not want or need these. So far, banks have set aside more than £12 billion to deal with the scandal > Anti-money laundering breaches In September, Standard Chartered was fined $340 million by a New York regulator for illegally hiding transactions with Iran, allowing the country to sell its oil for dollars from at least 2001 to 2007. Others to pay penalties included HSBC, Lloyds, ING, Credit Suisse, Barclays and ABN Amro, now part of RBS Fines imposed on leading banks Year Bank Fine (mn $) Reason Regulator 2012 HSBC 1,920 Money laundering lapses DOJ 2012 UBS 1,500 Libor manipulation CFTC/FSA/FINMA 2009 UBS 780 Aiding tax fraud DOJ 2012 StanChart 667 Anti sanctions OFAC/DOJ/MORE 2012 ING 619 Anti sanctions OFAC 2013 RBS 615 Libor manipulation CFTC/DOJ/FSA 2010 Goldman 550 Misleading investors FSA/SEC 2009 C.Suisse 536 Anti sanctions OFAC 2010 ABN Amro 500 Anti sanctions OFAC 2012 Barclays 451 Libor manipulation DOJ/CFTC/FSA 2009 Lloyds 350 Anti sanctions OFAC/DOJ 2010 Barclays 298 Anti sanctions DOJ/OFAC 2012 JP Morgan 297 RMBS offering SEC 2011 Citi 285 Misleading CDO investors SEC 2011 JP Morgan 228 Muni bond rigging SEC 2011 UBS 160 Muni bond rigging SEC 2011 JP Morgan 154 Misleading investors SEC 2010 BofA 150 Disclosing Merrill bonuses SEC 2011 Wachovia 148 Muni bond rigging SEC 2010 BofA 137 Muni bond rigging SEC 2003 JP Morgan 135 Enron SEC 2012 Mizuho 128 Misleading CDO investors SEC DOJ: Department of Justice, CFTC: Commodity Futures Trading Commission, FSA: Financial Services Authority, OFAC: Office of Foreign Assets Control, SEC: Securities and Exchange Commission Sources: Reuters/www.fsa.gov.co.uk.

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Assigning Responsibilities in the Libor Scandal
1233 The Differential Management of Financial Illegalisms: Assigning Responsibilities in the Libor Scandal Thomas Angeletti How, in a context of growing critiques of financialization, can law contribute to protecting the legitimacy of finance? This paper argues that the assign- ment of responsibilities between individuals and organizations plays a deci- sive role, using the recent Libor scandal as an empirical illustration. To do so, the paper offers a Foucauldian framework, the differential management of financial illegalisms, dedicated to the study of illegalities in financial capi- talism. The comparison of the legal treatment of two manipulations of Libor, this key benchmark in financial markets, reveals how mid-level traders have been the object of criminal prosecution, while law undervalued the role of top managers and organizations. To capture how differential management is performed in practice, I analyze precisely how the conflict-resolution devices (criminal trial vs. settlement) and the social categorizations prevailing in the two manipulations of Libor favor different forms of responsibility, individual or organizational. I conclude by exploring the implications of law’s relation- ship to financial legitimacy. For more than a decade now, the financialization of capitalism (Krippner 2011; Van der Zwan 2014) has been the locus of many critiques. Financialization has been studied sufficiently to under- stand how much finance has invaded our daily lives (Martin 2002), without measuring necessarily fully its ramifications. The clear causality between the rise of wages in the financial sector and the rise in income inequality in the United Kingdom (Bell and Van Reenen 2013), the United States (Volscho and Kelly 2012), and France (Godechot 2012) has put the financial sector on the spot.
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The Good Banker1
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The Libor Scandal: a Need for Revised National and International Reforms and Regulations
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I. the LIBOR Scandal A. Introduction the London Interbank Offered Rate
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G:\CDB\Opinions\Motion to Dismiss\Strougo V. Barclays
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17 The Moral of History or Immoral History? The name of protagonists, the signs of financial establishments as the dates are followed and certainly do not resemble each other. The story told, however, is always the same, punctuated by personal interests, greed, accidents on the financial markets described as “unpredictable”… so many episodes that marked the life of the past twenty-five years as “the more things change the more they stay the same”, as the Anglo- Saxons would say. A list – which does not claim to be exhaustive – of the scams and fraud of the world of finance and revealed only during a part of 2012 would indeed be eloquent. Let us begin with a case which lasted just as long as the Madoff scam, namely that committed by the owner of “Peregrine Financial Group”, who stole altogether the assets of his depositors. To build offices for $18 million or to pay fines handed down by regulatory authorities… whereby only $5 million remained in the accounts of his clients, which were supposed to amount to $200 million! A scam comparable with the best of them, made public in the Fall 2011, called “MF Global”, except that it was some $1,600 billion that went missing. Now let us talk about the illegitimate losses of $9 billion deposited during this period of 2012 by a JP Morgan Chase trader nicknamed “London Whale”… Or the shocking example of one of the premier banking institutions in the world, HSBC, which had to disclose that it was a repeat offender of money laundering.
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