Just pay the fine and no one goes to jail. Those that pay the billions in fines are the stockholders, there is never a personal or individual consequence. Jamie Dimon should have been in prison years ago, next to Bernie Madoff. Even more troubling is Jon Corzine with his criminal activity.
Attorney General, Loretta Lynch knows the depths of the fraudulent activity and seems to be complicit in giving individuals a blind-eye.
Big banks to pay $6B for market manipulation
Six of the biggest names in finance have agreed to pay nearly $6 billion dollars in penalties, with five pleading guilty to criminal charges over long-running manipulation of key financial markets.
The Justice Department announced the massive settlement Wednesday, its latest in a series of deals to bring to a close probes of financial manipulation of everything from benchmark interest rates to top currency exchanges.
Attorney General Loretta Lynch said the latest settlement brings to an end a manipulation scheme of “breathtaking flagrancy,” in which traders conspired to artificially alter currency exchange markets to obtain illicit profits.
U.S. authorities said that traders from competing banks frequently used chat rooms to conspire with each other to maximize profits for their institutions by manipulating currency trades, forming a group they dubbed “the cartel.” Dating back to 2007, Lynch said traders “acted as partners rather than competitors” in a “brazen display of collusion.”
The banks will pay the Justice Department and the Federal Reserve a total of $5.7 billion in criminal penalties, with most of the institutions also agreeing to plead guilty to some criminal charges.
Barclays, Citigroup, JPMorgan and the Royal Bank of Scotland all agreed to plead guilty to charges of conspiring to fix prices. UBS agreed to plead guilty to charges stemming from a previous investigation after the bank’s role in this new probe led the Justice Department to toss out a prior agreement not to seek criminal charges. Bank of America agreed to pay a fine as well.
The announcement is just the most recent in a string of settlements the government has struck with huge banks over industrywide bad behavior.
In April, Deutsche Bank agreed to pay a record $2.5 billion in fines, and fire several employees, for its role in rate-rigging. And in November, five large banks agreed to pay a combined $4.25 billion in penalties to U.S. and British authorities.
But those eye-popping numbers are unlikely to tamp down complaints from some lawmakers, like Sen. Elizabeth Warren (D-Mass.), and from outside groups that complain the government has failed to bring charges against top executives for illegal activity at their banks. Rather, they contend banks are happy to continue paying large fines as the cost of doing business.
On Tuesday, UBS announced it will pay $545 million to settle claims that it was manipulating the foreign exchange market. The bank also noted that the Justice Department terminated a 2012 non-prosecution agreement it struck with the bank, which was part of a previous settlement over interest-rate-rigging where the bank paid $1.5 billion.
But the government argued that the new charges violated the terms of that deal.
While the bank faces no criminal charges from the recent currency probe, the bank agreed to plead guilty to wire fraud stemming from the previous rate-rigging investigation, and attributed the misbehavior to “a small number of employees.”
Bank CEOs Blame Currency Rigging on the Work of a Few Bad Apples
Wall Street’s biggest banks admitted Wednesday to rigging currency markets around the world. Within minutes of the Justice Department’s announcement, they were blaming it on a few rotten apples.
“I share the frustration of shareholders and colleagues that some individuals have once more brought our company and industry into disrepute,” Barclays Plc Chief Executive Officer Antony Jenkins said in a statement announcing his bank’s guilty plea.
JPMorgan Chase & Co. CEO Jamie Dimon also pointed a finger at a few currency traders.
“The lesson here is that the conduct of a small group of employees, or of even a single employee, can reflect badly on all of us,” Dimon said in a statement.
Dimon ran his bank during the length of the currency conspiracy, which the Justice Department said lasted from 2007 through 2013. Jenkins has been CEO of Barclays since 2012.
Barclays and JPMorgan were among banks that didn’t detect and address traders’ illegal cooperation to manipulate benchmark currency prices, the Federal Reserve said Wednesday. Among the clues they missed: an instant-message group called “The Cartel,” where dealers exchanged information on client orders and decided how to trade.
Under a $5.8 billion settlement, JPMorgan, Barclays and units of Citigroup Inc. and Royal Bank of Scotland Group Plc agreed to plead guilty to conspiring to manipulate the price of U.S. dollars and euros.
‘Ethical Behavior’
Attorney General Loretta Lynch said at a news conference in Washington that the investigation is continuing. The Justice Department may bring charges against individuals, according to people familiar with the matter.
“Fostering a culture of ethical behavior has been, and continues to be, a top priority” for Citigroup, CEO Michael Corbat said in a statement. He added that the bank’s “internal investigation has so far resulted in nine terminations and additional disciplinary actions.”
RBS pinned the blame for violating U.S. antitrust law on one currency trader. Still, Chairman Philip Hampton said that more people may have been involved.
“We have dismissed three people and suspended two more pending further investigation,” Hampton said in a statement.
