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Making the punishment fit the crime – in the US, not the UK

Most people in this country have no idea how leniently the banks have been let off the hook for all their multiple and massive misdemeanours compared with the US and the EU. This week in the US the big banks have been told that if they are to meet government demands for new terms to settle claims for mortgage sales abuses, they will have to provide billions of dollars in relief to those communities which have been hardest hit by the financial crisis.

Imagine HSBC, Barclays, RBS and Lloyds being told that for palming off dud mortgages on consumers who could never sustain them, mis-selling PPI on a vast scale to consumers who didn’t need or want the, and rigging LIBOR with massive misallocation of capital values across the world, they would have to pour billions of pounds into reviving the North-East, North-West and Wales. No, I can’t either. In Britain not one penny has been extracted from the banks to reimburse their victims for the unemployment, impoverishment or homelessness imposed on them by the follies of the financial elite, and not one top banking executive has been prosecuted, let alone convicted and jailed.

Yet in America, which many would regard as the citadel of unrelenting capitalism and the enemy of anything socialistic, the government is close to a deal with one bank, the Bank of America, which will impose a record fine of $16bn-plus (£9.4bn) for mis-selling mortgage securities which will channel as much as $7bn (£4.1bn) back to cheated homeowners. Just imagine the UK Big Four being required to hand back £1-2bn to homeowners deprived of their homes or to the 1.8 million households on Council waiting lists or to devastated communities in the poorest regions.

 

Unimaginable in the UK where the banks are protected by a Tory party dependent on them for their financial survival, yet a reality in pure capitalist America. The settlement reached with Citigroup bank in the US earmarked $2.5bn for home-owner relief and redevelopment projects, plus directing 50% of a minimum of $820m to hard-hit cities, plus providing gap financing to build affordable rental units in area with a high cost of living. The absence of any of these things in the UK exposes just how extreme is the hard-right ideology of this Cameron government which regards the financial crisis as a God-sent opportunity to dismantle the Welfare State and stamp hard on its most helpless victims.

2 Comments

  1. Peter Rowlands says:

    Absolutely, but the UK is soft on the banks also because it fears losing London as the leading EU financial centre, something that would definitely happen if we left the EU.

    1. Robert says:

      Then maybe it’s time, because the banks are to costly they are way to costly ,if they move out then possibly our government would have to work at getting us back to the top in manufacturing and being the top at expertise in say robotics after all we use to be before the banks became the glow in the eyes of the politicians.. lets be honest another mess like the last one and people will not be saying never mind it was an accident they’d be wanting blood.

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