HooHa: Finally, A Few Bankers Face Criminal Prosecutions For Conspiracies
By Danny Schechter
New York, New York: When most mainstream media outlets discuss conspiracy theories, it is usually to debunk the views of dissenting and critical thinkers who are routinely denounced as simplistic, paranoid or worse.
You have frequently seen the mantra questioning their motives and conclusions as if the idea of people or officials acting together covertly to advance their interests in illegal ways is something new in history.
Until recently, US press outlets characterized conspiracy arguments as rants that lacked any factual basis, engaged in guilt by association and stretched the facts.
The only conspiracy charges they tended to look at uncritically were criminal complaints against the Mafia under anti-racketeering statutes like the RICO statutes. Prosecutors loved these cases because normal concerns with protecting the rights of defendants didn't apply when hearsay evidence was permitted.
But now, four years after the financial crisis, prosecutors have finally discovered what critics have been alleging repeatedly: that big banks were crooks, engaging, engaging among other illicit practices, in secretive, illegal and conspiratorial schemes to rig baseline interest rates and manipulate credit markets,
It has now been admitted that traders at two major financial institutions were fixing LIBOR--the London Interbank Offered Rate, used to set the interest rates of $800 trillion worth of financial products, including credit cards and mortgages.
That figure again: $800 trillion!
The banks: Barclays and UBS. At first, regulators got them to agree to pay fines in so-called "settlements," which are viewed by these institutions as a cost of doing business.
Barclays shelled out $450 million, but UBS went further paying a whopping $1.5 billion fine. They also admitted to fraud and bribery. (Usually banks settle such complaints with out any admission of responsibility).
The Brits took the money, but US prosecutors went further and also lodged criminal charges against two former UBS senior traders for the Libor manipulation. They are the first individuals to be charged in what Reuters called "the wide-ranging investigation that involves more than a dozen big banks."
(Note: Only two were charged, and neither works for UBS anymore. The Naked Capitalism site scoffed: ""So far, the top echelon of UBS is unaffected by this epic scandal. Until we see executives suffer (and fines are insufficient if they remain wealthy), it's a no-brainer that this type of behavior will continue, albeit in different businesses and new guises.")
The practices were "absolutely rampant" between 2005 and 20 10, according to the Daily Beast which also noted:
"Both the Barclays and UBS settlements show a combination of systemic corruption--senior officials who did not seem to care about illegal activity going on--and a tight-knit, foulmouth fraternity among the traders themselves. While the Barclays boys talked about buying each other Bollinger, (ie. pricey champagne), the UBS fixers deployed nicknames, profanity, and a total disregard for the fact that their communications with each other might one day be made public. "
The Wall Street Journal couldn't ignore the story and reported that regulators "alleged" a vast conspiracy, even after the banks admitted to some of what they had done. Rupert Murdoch couldn't resist his tabloid training by having two UBS stars quoted in large type on the front page: