Our Justice Department: Wall Street’s Wimp
The U.S. Justice Department, which since 2007 has basically considered Wall Street’s major banks as too big to prosecute, sorta got two of the biggest on Wednesday to admit criminal activity: manipulation of the massive, multi-trillion-dollar foreign exchange market.
In pleading guilty, Citigroup agreed to pay $925 million in criminal fines; JPMorgan Chase will cough up $550 million. The two, along with three other major financial institutions will pay a total of $5.7 billion. British bank Barclays Plc will pay $650 million in criminal penalties, and $1.3 billion to settle with a group of federal and state agencies. Royal Bank of Scotland will forfeit $395 million for criminal activity.
According to The Christian Science Monitor:
Each will plead guilty to one felony count of conspiring to fix prices and rig bids for US dollars and euros in the foreign exchange spot market.
Euro dollar traders at four of the banks described themselves as members of “The Cartel” and used an electronic chat room and coded language to manipulate exchange rates to increase profits, the Justice Department said.
The $5.7 billion total includes $1.6 billion in fines separately imposed by the US Federal Reserve on the five banks.
Separately, the Fed fined Bank of America Corp $205 million for unsound practices in foreign exchange.
If $5.7 billion sounds like a lot of money, it is to the average family, but not to these major banksters. Why? Because on the foreign exchange market, traders – including the market manipulators – deal in trades totaling an average of $5 TRILLION a DAY.
According to new U.S. Attorney General Loretta E. Lynch, “The Cartel” began operating in 2007, and manipulated its schemes for FIVE YEARS.
So, for simplicity’s sake, let’s figure $5 trillion a day for 50 five-day weeks a year. That’s $25 trillion a week, coming to $1,240,000,000,000 a year. Now, multiply that times 5. That’s the amount of global trade the banksters’ criminal activity affected, because their individual deals had to shake currency prices throughout the foreign exchange.
Think of how many people’s lives they impacted with their fraudulent trades.
So, now…does $5.7 billion sound like much? A drop in the turbulent green ocean of foreign exchange.
As Bloomberg financial reporter Keri Geiger told PBS Newshour earlier Wednesday evening: “a slap on the wrist”.
It’s not clear if any individuals will be prosecuted. The Justice Department historically doesn’t like to do that. It even fined but didn’t seek jailing anybody a couple of years ago when HSBC admitted it had laundered billions of dollars in DRUG MONEY. Think of the number of lives that impacted.
We wrote a Peculiar Progressive column two years back for The Clyde Fitch Report showing how different national governments responded to fraud-committing bankers involved in the 2007 global meltdown. Iran sentenced four to hang until dead — including billionaire businessman Mahafarid Amir Khosravi — and sentenced others to life or decades-long prison sentences for an embezzlement scandal. Iceland closed some banks and jailed some banksters. The U.S. bailed them out – too big to fail, you know.
Maybe this time the Justice Department will muscle up and actually seek some prison sentences. It’s clear neither the Millionaire President nor Millionaire Congress has voiced a desire to do that. After all, if you’re a millionaire politician, probably you’ve had dealings with Wall Street…either directly or through lobbyists.
But President Obama, after hanging around for six years, looks like he wants to add something to his resume to offer historians…something besides droning innocent civilians, arming police departments with military hardware to intimidate citizens, intimidating journalists and whistleblowers, and continuing a foreign policy of endless war to support America’s oligarchy and the military-industrial complex. For show this week, he announced that – after more than half a decade — he’s finally going to halt some of that military arming of local gendarme.
Okay, we’ll give him and Congress a couple of points for helping private insurance companies provide health insurance to millions unable to afford it.
So, who knows. Maybe he will even, for show, go after a couple of high execs on Wall Street; maybe even JPMorgan’s Jamie Dimon who wears Presidential-seal cufflinks when he testifies before Congress. Wouldn’t that be cool for historians to write about.