Everyone in Financial Services knows Banks are above the Law.
It is a sad fact of regulatory life that the bigger you are, the less you need to fear financial services regulation. If you are a financial adviser, every little action you take could be the one which the regulators decide use as an excuse to put you out of busines. But banks are above the Law, apparently:
Magnify the same mistake a million times (say PPI sales by banks or the banking crisis) and the regulators will slap you with a fine that will barely dent your profits for the year. That despite the fact that you had the resources and skills to do the right thing. If not the ethics. Rich bankers have little fear of regulators punishing them personally, as they have the best lawyers to protect them. The lost 380,000 finacial advisers had no such protection, and probably did less damage between them than a single rogue banker.
Hand over the petty cash, regulators tell banks…
Sadly, the UK regulatory system is heavily weighted against small firms (you know, the ones that actually care about their clients) and favours the big boys who will provide ex-regulators with future opportunities. It isn’t bribery, but is most certainly very unfair on both the public and the lost 380,000 advisers, their families and their clients who can no longer get advice in the majority of cases.
Here is the latest occassion on which a bank has had a slap on the wrist where a financial adviser would have been put out of business. There are dozens more, and the injustice wil continue.
Is dishonesty in banks above the Law?
Obviously, it shouldn’t be. But the results of banking regulation appear to indicate that bankers lead charmed lives, and their worst fear is that they might lose their knighthood or part of their fat pension. But most won’t even suffer such dire fates, they will get off scot free.
Chanel 4 has investigated several banking scandals here.
As Max Hastings of the Daily Mail implies, the banking crisis which resulted in most of the current economic issues of the UK, and which we will still be paying for in 100 years SHOULD have resulted in jail time, not fat pension pay offs.
And even when the regulators do have a go at their friends at the banks, they get it wrong and guess who misses out? Not the wealthy!