Tuesday, 30 October 2012

Platitudes and Placation

Financial Times Chief Economics Commentator, Martin Wolf once said, “The conclusion to be drawn from [the Bank of England’s executive director for Financial Stability Andy] Haldane's work is that an out-of-control financial sector is eating out the modern market economy from inside, just as the larva of the spider wasp eats out the host in which it has been laid” and with mounting evidence to support claims that the FSA have neither the stomach nor the inclination to prosecute banking criminality, the best that victims of the UK’s banking crisis can expect from reform is a ring side seat for an endless round of regulatory wrist slapping.

Placated with promises of integrity and more customer focused business models, the FSA have allowed the individuals within the banking fraternity (whose greed cost hundreds of thousands of UK residents their livelihoods along with their homes) to escape the consequences of their actions with little more than,

·       and a marginally demeaning ban from working in the city

While retaining,

      ·        several very desirable residences,

      ·        a substantial asset based net worth
      ·        and very sizeable pensions

Despite amassing a great deal of this wealth by indulging in all sorts of elaborate chicanery-including the widespread abuse of structured investment vehicles, conduits, derivatives, securitizations and collateralized debt obligations, boost leverage, gaming the regulatory system and avoiding tax, the Peter Cummings(HBOS) and the Fred Goodwins (RBS) of this world are left to lick their meaningless wounds aggrieved at being singled out for FSA tokenism. In contrast, the victims of this banking plague of financial spider wasps are expected to suffer the blanket approach to asset stripping which followed the near collapse of our financial system and plunged the UK into four long years of economic crisis.

During this time,

       ·        UK home repossessions have averaged nearly 3000 a month
       ·        UK unemployment has risen to 2.53 million
       ·        And austerity led government cut backs in both the NHS and Benefits department continue to be hugely detrimental to the nations most vulnerable.

Yet with UK regulatory eyes seemingly fixed firmly on how best to help those who perpetrated a global financial crisis retain both their wealth, and in some cases their power without either party losing face, I fear there is little hope for those of us seeking sanctuary from the relentless pursuit of lenders who are intent on socializing their losses from the property crash they created.  It is, nevertheless, mildly encouraging to find limply legislated lip service has not been the only method by which some of the fraudulence of global banksters have been addressed.

In this month alone,

        ·        Former Anglo Irish Bank chairman and two of his senior executives are to be tried in a criminal court over banking irregularities which have cost the State 29 billion

.       ·        The United States Government has filed a fraud lawsuit against Bank of America Corporation alleging the bank cost taxpayers more than one billion in losses when they sold defective home loans to government backed mortgage companies Fannie Mae and Freddie Mac.
        ·        US home owners launched a class action against banks who repossessed their homes following the calculated use of Libor manipulation to inflate mortgage repayments and affect default.

Scottish astronomer, academic and computer scientist William Samson once said, “A writer lives in a state of astonishment. Beneath any feeling he has of the good or evil of the world lies a deeper one of wonder at it all. To transmit that feeling, he writes” and while I do not deny I am regularly in a state of astonishment over the behavior of the UK's financial regulators, I cannot help but wonder how, despite widespread evidence of banking fraud and continued public outrage, banksters are slipping affluently off the hook into retirement, with the vast majority of their spoils in tact, to enjoy a life of elitist comfort completely Scot-free.

It is certainly not a future their victims can anticipate and this is reason, I write.

Friday, 19 October 2012

Guilt and Weakness

German born theoretical physicist, Albert Einstein, once said, “Any intelligent fool can make things bigger, more complex and more violent. It takes a touch of genius, and a lot more courage, to move in the opposite direction” however when it comes to regulating our errant bankers or taking them to task for their crimes, it appears genius and courage are not to be called on. I am certain it is because of this that my dealings with the Financial Ombudsman Service continue to make little progress.

Following a full review of my file, a process which took a further three weeks, I am now told,

·        The FOS do not accept they are guilty of giving an unresponsive HBOS countless opportunities to discard my case on jurisdiction grounds whilst simultaneously hounding me for instant replies in order to be “fair to the business”.
·        The FOS do not accept they are guilty of unnecessarily asking me to collate my case in detail, despite declining it on grounds of jurisdiction after weeks of preparatory work, nineteen months later
·        The FOS do not accept they are guilty of favouring HBOS despite a period of nine months with no progress from the time I lodged my over-valuation complaint

However, in complete contrast to the tone of the majority of their letter I am also told,

·        The FOS sincerely apologise for their lack of diligence with regard to securing an HBOS response to my over valuation complaint. 

Mildly encouraged by this minor step forward yet resigned to the inevitability of endless waiting, I can only conclude the FOS's lack of impetus in this instance is not merely oversight due to unprecedented levels of complaints but is instead an endemic reluctance to tackle the UK's bankers and an clear indication of their discomfort at the prospect of unearthing another bankster miss-selling (or rather sub-prime overselling) scandal.  For this reason it is no surprise to hear,

With mounting evidence to suggest economic reform, financial regulation and banking prosecutions will amount to nothing more substantial than an after dinner speech, it seems the new chairman of the British Bankers Association, Sir Nigel Wicks, is correct in saying “we must all take personal responsibility for the restoration of trust in banking”. His words could not ring truer now that it is abundantly clear the restoration of trust in our bankers is to have nothing to do with the genius of our regulators and has even less to do with the courage of our Financial Ombudsman Service.

Albert Einstein also said, “Weakness of attitude becomes weakness of character” and I suspect this is precisely what errant bankers are counting on to escape prosecution for their crimes. I hasten to add weakness of attitude and weakness of character is not what the Halifax Bank of Scotland or the Financial Ombudsman Service can expect to encounter in their dealings with me.

Monday, 8 October 2012

Malice, Manipulation and Aforethought

American business magnet, investor and philanthropist Warren Buffet once said, “Economic medicine that was previously meted out by the cupful has recently been dispensed by the barrel. These once unthinkable dosages will almost certainly bring on unwelcome after-effects” and, as is the case with so many victims of the current global economic crisis, it seems unwelcome after-effects are precisely what those of us who have suffered at the hands of fraudulent banksters are expected to endure.

It is now fast approaching three weeks that I have been waiting for a response to my letter accusing the Financial Ombudsman Service of favoring Halifax Bank of Scotland in their investigative practices. It seems I am, along with numerous other victims of banking malfeasance, not only expected to swallow said "economic medicine" by the barrel but feel heartily reassured in the knowledge that the very same people who stripped us of our livelihoods and our homes have now, under the watchful eye of our regulators, kicked their culture of greed into touch and will henceforth be operating with our well being at the very core of their corporations.  Now pious and reformed after inadvertently relieving their customers and the global economy of trillions we, the voiceless general public, are urged to believe the following.

     ·        Rewriting the banking codes of conduct will protect us

     ·        Prosecuting banking fraud is neither desirable, practical or good for the economy


·        New legislation along with revised incentive packages will thwart any bankster’s fraudulent inclinations in the future.

However, if my personal experience of battling with the banks for the past four years is anything to go by, nothing could be further from the truth. In the real world customer well-being is definitely not paramount and irresponsible banking is unlikely to be a thing of the past when I am regularly told by financial regulators,

    ·        Flaunting banking codes of conduct are perfectly permissible as adherence to      them is optional

    ·        Prosecuting a bank is nigh on impossible because it is too difficult to prove intent

    ·        Duty of customer care is not a requirement in law

In the real world, a far off place banksters and their puppet regulators rarely visit,

·        Anglo Irish Bank’s “insane recklessness” not only contaminated the underwriting policy of fellow lenders but was pivotal to a property crash which lost millions of people their homes, their livelihoods, their pensions and in some cases their lives. Needless to say not one iota of reform or regulation has provided restitution for those who paid the price of a calculated manipulation of the property market for elitist personal gain.

In the real world,

·        Loyal Royal Bank of Scotland's commercial borrowers continue to fall victim of “knavish manoeuvres” expressly designed to hijack their assets. By shifting billions in commercial debt and concealing losses via balance sheet manipulation, RBS's bad loans and liabilities have been miraculously transformed into the assets CEO Stephen Hester so desperately needs to successfully implement his recovery programme.

In the real world,

Libor manipulation is not just inappropriate conduct which the banking industry and their regulators have been fully aware of from as early as 1990's , but a manipulative rouse to steal people's hard earned cash and escape unpunished to bask in the profits.

·   And, in the real world,   

·        HBOS are perfectly at liberty to willfully neglect their duty of care, over-sell a discounted, interest only mortgage secured against a family home they vastly overvalued, exclude me from all discussions from the outset, start repossession proceedings without making me aware the loan was in distress, ignore my offer of rental income to service the interest, force a sale which created a £217,000 shortfall and hound me for the re-imbursement of a deficit which came about as a direct result of their highly dubious business ethics and wanton recklessness.

Nineteenth century Civil war veteran and American political leader Robert Green Ingersol once said, “Happiness is not a reward-it is a consequence and suffering is not a punishment but a result” however, if those whose greed resulted in our suffering remains unpunished and regulators are increasingly happy to repackage captured reforms as a solution to an economic crisis which has left millions in financial purgatory, I suspect suffering is destined to be both the consequence and the result for a great many victims of banking criminality for the foreseeable future.

I sincerely hope I am wrong.