Ecclestone shouldn’t be able to bribe his way out of bribery – he should go to prison

Bernie EcclestoneIt is shocking that Bernie Ecclestone could offer a £100m payment to walk free of a massive bribery case for which he was clearly guilty. He admitted he had given an official a £44m bribe in order to head off an investigation into his tax affairs, but when this is rumbled he gets away with it scot-free by offering an even bigger bribe to a judge which to a multi-billionaire like him is small fry. No question of him serving a prison sentence for a very serious criminal offence, not even of his being disqualified from holding a senior executive corporate position when his record had shown he was fundamentally dishonest and untrustworthy. Appallingly this case reveals yet again that prison is for the little people, not the big name offenders who can buy their way out. Continue reading

Only little people pay the penalty

Recent decisions on the banks, police and health service cast a rancid light over the current nature of the British State. RBS was shamed by an enormous £390m fine for ‘widespread misconduct’ in rigging the Libor rate at least till November 2010, 2 years after it was bailed out by taxpayers. Regulators found that corrupt payments of over £100,000 were made to those involved in fixing, for their own profit-maximizing purposes, the rate used to set prices on £350 trillions of financial contracts across the world.

Who was held accountable? Not the chairman Sir Philip Hampton nor the chief executive Stephen Hester who was still awarded his 2010 £2m bonus. The fall guy was John Hourican, the head of the investment bank, though he had n0 direct involvement. Still he got a £750,000 payoff for taking the rap for his superiors. The real culprits, Hampton and Hester and the relevant traders have not been repimanded, let alone sacked or prosecuted or disqualified from practising in finance. And why no boardroom resignations?

Continue reading

The scandal of PPI: where were the regulators?

The BanksEven as we have got used to the iniquity of the banks, the latest revelations still take the breath away. The scale of the payment protection insurance (PPI) mis-selling scandal is truly gigantic. The aim behind PPI was to cover borrowers’ loan repayments if they fell ill or lost their job, but it developed into a monster which sold to borrowers who often didn’t want or need it, and certainly had little or no idea of the scale of commitment they were taking on.

PPI could add 20% to a personal loan, and the profit margin on selling PPI made by some banks actually reached the staggering level of 90%. By offering ‘free insurance’ (actually a free month’s trial as a hook, after which it was for the customers to cancel the policy, which few did), the banks sold 20 million PPI policies by 2006, and between 2001-10 amassed colossal sales of £34bn, equivalent to a quarter of the entire UK GDP.

Continue reading

The proposed reform of LIBOR will still fail

Martin Wheatley, the head of the new proposed Financial Conduct Authority which is supposed to regulate and prevent wider issues of malfeasance in the City than the FSA was able (or rather, unable) to deal with, recently had this to say about the LIBOR (London Inter-bank Offered Rate) which acted as the benchmark for $300 trillions of derivatives across the international economy: “a broken system built on flawed incentives, incompetence and the pursuit of narrow interests that are to the detriment of markets, investors and ordinary peoploe”. Continue reading