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Wednesday, 24 September 2014

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Maybe we should all bank more ethically

So Barclays chief executive Bob Diamond has finally resigned in the wake of the rate-rigging scandal.

I’m sure he’ll get a nice big fat severance deal as he’s only managed to claim £100 million in wages over the past six years.

He decided to fall on his wallet after Barclays was fined a pitiful £290m by UK and US regulators for manipulating the Libor, the rate at which banks lend to each other.

Meanwhile, the Government has decided to set up a parliamentary enquiry into our banking system. Yippee!

But if the politicians recommend stricter rules for banks and their workers, who will police, enforce and investigate any wrongdoing?

The police? How? With what resources? They’re being asked to cut back more and more.

The focus of the Government is getting more and more squint.

Instead of toughening up tax loopholes for high earners, they’re cutting benefits to those who don’t earn.

Rather than stricter controls for banks they want more cuts to our police forces.

In the current economic climate, I appreciate we have to make savings in all areas of society, I just think that some areas – like policing – need more careful consideration.

As for the latest bank scandal, following on from overdraft overcharges, mis-selling insurance, mis-selling loans...

We can blame Gordon Brown and Ed Balls for being the prime minister and banking minister around the time all this happened. It could be their fault regulations weren’t strict enough and that any the watchdog we had was toothless and asleep.

We could blame the Conservative opposition at the time for not doing enough (or anything) about the excesses of the industry.

But it doesn’t matter how strong or weak your rules and regulations are, the villains are those that break them.

The people who deliberately choose to make up their own rules and ways of doing things.

What happened was illegal. It was fraud. Plotting with others to rig a market is criminal.

People found guilty should be punished.

Businesses and corporations involved should be punished. Properly. With proper, big financial penalties for the businesses, not the tupenny ha’penny fines that have been imposed.

These fines should be paid to the people they have colluded against and defrauded: Us.

Not paid into some government account. We should get cheques (sizeable cheques) through the post, or else our mortgage payments met.

We should remember that it is not just Barclays and diamond geezer Bob involved in all this. The corporate culture of many of our banks is morally and ethically bankrupt.

Other banks and financial organisations need to own up and clean up as well as Barclays.

David Cameron’s answer to the issue is wearily predictable.

He doesn’t want an inquiry headed by a judge because, well, you just never know where that might end up.

You just don’t know who of your friends might get caught up in it; which e-mails might be read out in public to reveal your supper arrangements; what it all might do to your chipped and battered reputation and just how long it would all drag on for.

Much better to get some backbenchers to ask a few questions, quickly scrape the surface, draw up some recommendations that might pinch the banks a bit but will generally suit them and give it all an air of action, conclusion and resolution.

Politicians will look for someone to blame, rather than providing a long-lasting solution that ensures a banking system we can trust.

Instead, why not draw up a panel of independent banking experts to fish around the murky waters, find out exactly what happened and make recommendations to penalise and strictly regulate and prevent all this from happening again?

Of course, the ultimate punishment lies in our own hands.

We can withdraw our money from the RBS, Barclays, HSBC and all the rest and put it in a more ethical organisation, such as the Co-op bank, a local building society, mutual group or credit union.

They can do all the day-to-day stuff we all need and none of their bosses are looking to make millions a year.

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