The Olympics are supposed to produce harmony and understanding between nations, but as the 2012 London Games wind down, there’s nothing but acrimony between the UK and its former colony—us.
First, Republican presidential candidate Mitt Romney started off his recent foreign tour by wondering aloud whether London was ready to host the Games, creating a furor across the pond. (“Mitt the Twit” ran one tabloid headline.)
Now, an obscure regulator, Benjamin W. Lawsky, head of the New York State Department of Financial Services, has got the Brits’ knickers in a twist after he labeled UK bank Standard Chartered a “rogue institution” and accused it of violating US sanctions against Iran by hiding some 60,000 transactions with the Islamic Republic worth $250 billion, allegedly earning the bank hundreds of millions in fees.
The complaint quotes a Standard Chartered executive as saying: “You f—ing Americans. Who are you to tell us, the rest of the world, that we’re not going to deal with Iranians.”
The complaint could lead to Standard Chartered losing its banking license in New York or the US. It follows settlements with British banks Barclays in the Libor price-fixing scandaland HSBC, which was accused of helping “[Mexican] drug cartels, terrorists, and pariah states” launder money through various affiliates.
But the Brits are particularly up in arms about Standard Chartered. MP (member of Parliament) John Mann, whom The New York Times described as “perhaps the most strident critic of Britain’s banking culture in Parliament,” charged that the Standard Chartered case “reflected an anti-Britain bias by American regulators, who he said were trying to bolster Wall Street at the expense of the City of London.” He told the Times:
I am no apologist for British banking, but if this attempt to blame London succeeds it will give comfort to all the banks breaking the rules in the United States.
So, it all comes back to the lack of prosecutions of Wall Street bankers who helped cause the biggest financial crisis since the Great Depression. That inaction (as opposed to its more aggressive stance towards foreign-domiciled banks) continues to haunt the Obama administration as the president goes before voters for a second term.
Now the gadfly conservative website The Daily Caller suggests why the president, so often accused of banker bashing, has done nothing of the sort: pure cronyism.
The Caller relied heavily on a report by the conservative Tallahassee, FL-based Government Accountability Institute, run by prolific author Peter Schweitzer. I don’t know anything about the GAI nor who funds it, but I found its opinions worth sharing.
The report said the top officials in the Justice Department, from Attorney General Eric Holder down, “all came to the DOJ from prestigious white-collar defense firms where they represented the very financial institutions the DOJ is supposed to investigate.” It gives plenty of examples.
GAI said that President Obama’s decision to choose Holder, “a white-collar defense attorney from Covington [Burling],” as his attorney general, over a “more fiery prosecutor,” appears to have sent “a subtle signal to the financial community” that this administration isn’t going to actually do anything, despite the harsh words.
“The problem that you have at the Obama Justice Department, particularly bizarre at this time and place where we were coming off the financial crisis, is that they really have no recent prosecutors at the top…,”[said Schweitzer]. “They’re all white-collar criminal defense attorneys. That’s what’s so troubling.”
Troubling indeed. I think Treasury Secretary Timothy Geithner’s desire to keep Wall Street firms from going under was another reason the administration treated the big banks with kid gloves. But if we let our own banks live in glass houses, we look like bloody hypocrites if we throw too many stones at others.