Richard Lutz reports on how the Treasury will advance the causes of a UK bank industry that has been fined a total of £75 billion for fraud and stealing from its customers.
News reaches us that the Chancellor Philip Hammond will meet with Indian businesses this week to encourage them to use the expertise of the City of London, in the hope of building trade links outside of the European Union.
It is all part of the complicated Brexit talks which are lumbered with detail after detail after detail followed by confusion after confusion after confusion. Philip Hammond’s trade mission to Delhi and Mumbai is part of a plan to build a partnership with India as it works to forge a future as a global manufacturing powerhouse.
So let us remind ourselves just what financial institutions and products Hammond will try to hawk:
Here are some of the banks whose services he will offer:
- Lloyds Bank: Fined £218 million in 2015 for rigging the interbank loan rates (called Libor). Also fined £28 million the year before for bullying workers to mis-sell products that clients did not need
- RBS: The bank was fined £56 million in 2012 for mass computer failures. In 2014, it was stuck with a £399 million fine for messing with the Libor rates
- Barclays: In 2014, it was penalised £2.5 billion for dealing in the so-called ‘dark pool’ which secretly gives better rates to customers with bigger assets. It also was fined $360 million for Libor fraud
- And HSBC: besides being fined for money laundering, it was hit with a two pronged fine totalling $618 million, for foreign exchange rigging. And in January of this year again fined $33 million for “unsafe and unsound” procedures for changing peoples’ account and payments.
In all, the four biggest UK banks, according to research, will pay out an estimated £75 billion in fines from 2011 to the end of this year. That takes in rigging the Libor rates, grabbing money from poorer customers through the illegal selling of unneeded Payment Protection Insurance (PPI), and dealing in toxic mortgages.
The rating agency Standard and Poor called it staggering, with 9% of the four banks’ revenues chewed up in fines. Of course, S&P is itself hardly an unsullied organisation. It was fined $77 million by US authorities for rigging the ratings of mortgage backed securities after the ’08 crash.
I am sure the Indian financial experts will have this in mind when they sit down at the bargaining table withtThe Treasury. After all, it’s good to deal with the Banks that Like to say Theft.