Every so often, the
public prints get a news story absolutely right.
I have found in so many
cases, the best interpretation of events is to be found in the cartoon
sections, particularly on the business pages.
I have been blogging
on the issues of the absence of moral responsibility in the financial sector
for a long time now! So, imagine my great surprise (and pleasure) to see a
cartoon which encapsulates, in its entirety, the whole moral conundrum which
the City and the criminal banksters face every day.
The fact that this
cartoon appeared at the same time as the announcement that RBS was paying out a
raft of bonuses to its employees, merely makes the amusement even sweeter.
I will seek to
describe the cartoon in greater detail in a later paragraph, but let me set the
scene by commenting on the latest bonus nausea emanating from the Caledonian
bank of unreformed criminals, conmen and clowns.
The RBS chief
executive, Ross McEwan, acknowledged that the issue of paying bonuses was "highly
emotional" as he explained the multimillion pound windfall at the
taxpayer-owned institution.
I would have thought
that emotion was the least of his worries, because he is clearly, in his own
words, rewarding his staff for their criminality, I mean, he says so himself,
in terms.
I had always thought
that bonuses were paid when employees reached a specific target, but not in
Scotland, apparently. This year the bank paid up huge bonuses despite suffering
an £8.24bn loss in 2013 as it slumped into the red for the sixth successive
year.
Now, as a tax-payer, I
am a shareholder in this joke institution. We have been ploughing money into
this shell for years, and still it hasn't finished paying off its debts and
punishments.
The CEO avers; "...I
need to pay these people fairly in the marketplace to do the job. I do need to
make sure we are there or thereabouts and that is all I'm asking for..."
he said.
Not unreasonable you
may think, until you come to realise that the latest annual loss was caused by
£3.8bn of costs for settling litigation and regulatory problems – including
£1.5bn extra to compensate customers fraudulently induced payment protection
insurance and interest rate swaps in the UK – and £4.5bn of losses on bad
assets.
He was literally
rewarding his people for the mess that they had created for the bank. When you
fraudulently induce customers to pay for PPI insurance, secure in the knowledge
that it isn't going to do what you are claiming, you commit the offence of
criminal fraud, and you deserve to be nicked. Try clocking a second hand car
before you sell it and see what sympathy you will get from the courts if it is
discovered. The principle is exactly the same.
The company's shares
fell 6.7% to 330.2p on the receipt of the news, wiping more than £2.5bn off the
market value of a business that is 81%-owned by the taxpayer.
McEwan, who took over
from Stephen Hester in October, at least got some things right. He said that RBS
needed to regain the trust of its customers and the public.
"We happen to be
the least trusted bank in the least trusted sector in the marketplace," he
said.
Well, don't worry
McEwan, there are a whole heap of banks queuing up behind to challenge you for that
title!
Bankers' bonuses
continue to plague the industry amid public uproar over past misconduct. Barclays
increased bonuses to £2.4bn. HSBC said
on Monday it would increase salaries for its bosses to get around a European
union cap on bonuses.
McEwan, who has turned
down his bonus for 2013 along with his executive team, declined to say whether
RBS would ask shareholders, including the government, for permission to
circumvent the EU bonus cap this year. "The board has not opined," he
said.
I'll bet they haven't.
Considering that such a move would hit them all, in the pocket if it goes wrong, I'll bet they
are all sitting shtum and waiting for someone else to make the first move.!
McEwan replaced
Stephen Hester as chief executive after Hester was forced out last year by
chancellor George Osborne. At the time, RBS said Hester was leaving because a
new boss was needed for the start of privatisation, possibly this year.
But McEwan said his
plan would take up to five years to complete, casting doubt on the government's
ability to sell its 81% stake any time soon.
So, yet another lie in
a long line of lies and mis-statements from this pile of hopeless crap.
Frankly, we would all have been better off, if when it was in so much financial
trouble, the Government had just taken it over and wound it up in the public
interest. We would have lost some money, admittedly, but each year we are
forced to spend more and more on this criminogenic edifice, just to keep it
afloat.
And what has all this
got to do with a cartoon in the Daily Telegraph?
I am always amused
when I hear the private protestations of bankers about wrong-doing in their
institutions.
"...No no, we
didn't know that anything untoward was going on...What do you mean I am the CEO
and should know what happens in my bank...All our staff are fully trained in
their compliance objectives..." etc, etc!
Well, the cartoonists
who draw the Alex cartoon on the Business Section page, clearly have a very
cynical view of such protestations too, indeed, I never cease to marvel how
close to the truth and the reality of the City their cartoons get.
Alex is the epitome of
the loathsome investment banker. He and his wimpy friend, Clive work for a huge
banking institution. They are at a senior level in the process and Alex thinks
only of the money he already has, and the greater amount of money he can
acquire through bonuses
He has recently picked
up his wife's I-Pad by mistake, and as she is a major non-executve director of
a large corporate conglomerate, he not unreasonably believes that the I-Pad
will contain a vast amount of confidential corporate information which he can
use to gain business advantage.
In the cartoon, he has
been busy trying to get the I-Pad open to read the information, but he cannot
gain access as the contents are encrypted. Succeeding eventually because his PA
knows his wife's birth date, Alex has of course forgotten it, he then decides
to give the pad to a young intern to go through the information and summarise
its usefulness. We pick up the story where the young intern is telling Alex
what she has done with the pad.
Alex says:
"...You did what with that I-Pad I entrusted to you, Amelia..?"
Answer: "...I
handed it in to Compliance..."
Alex says:
"...You utter idiot..."
Amelia says:
"...Look, Alex, you were asking me to extract information from an
illicitly-obtained device. This clearly breaches the bank's fraud prevention
code..."
Alex: "...I don't
believe this, you're a graduate trainee! Your only function is to do tasks that
we delegate to you...What do you think gives you the right to lecture me on
business ethics..."
Amelia: "...Maybe
the fact that you all delegated the task of doing your on-line anti-fraud
training modules to me. I got 100%..!"
Alex: "...But you
weren't supposed to take it seriously..."
In this perfectly
encapsulated small vignette, the cartoonists have amplified the whole gamut of
how the City fails to take Compliance issues seriously, and how young trainees
are shown the worst kind of business examples.
Alex and his friends
abuse the young trainee's time by getting her to complete their electronic
training requirements, a feature which is ubiquitous in all bank training,
particularly money laundering awareness, and then when she demonstrates that
she has learned the lessons the training was intended to inculcate, she is
blamed for taking it seriously.
So the message that
comes through is that Compliance is all a waste of time, unethical behaviour is
acceptable as long as you make money, that breaching the bank's codes of
procedure and crime prevention are there to be ignored, and that it is
perfectly permissible to abuse young interns and trainees.
I know that the
cartoonists are only doing this to raise a laugh, but underneath the laughter,
there is a very serious message being spelt out here! All this wrong-doing, this criminality is driven by over-paid executives who are willing to flout the norms and ethics of conventional behaviour to make more money. They all know what they are doing, and they all know it is wrong, and we need to start locking them up.
We need more
cartoonists and satirists to hold a mirror up to nature in the Square Mile.
Perhaps if we had a Thomas Rowlandson, or a Hogarth, a Jonathan Swift or a Daniel Defoe alive and working today, we
would have a wonderful set of examples to pick from.