(5i) Banks and scandals - Today partners

A new banking scandal and this time HSBC is involved as well as (again) the rich who were advised by the Swiss branch of the bank on how to avoid paying taxes in their own country. These are the people who warn for instance the Greeks not to avoid paying taxes in order to be able to repay the banks.

The bosses of HSBC were forced to explain at a parliamentary hearing what went wrong. They explained it was a difficult branch because its managers and employees hid their actions behind the Swiss banking legislation that actively stimulates corruption by promoting its banking secrecy. However, his explanation is difficult to follow as he too avoided paying taxes although it seems to avoid jealousy amongst his colleagues.

 

Still, indeed the Swiss banking secrecy makes it difficult to check banks. Nevertheless, ordinary people who work at companies will not be able to hide any activities for their bosses or face redundancy or even the involvement of the criminal justice system. Thus any suspicion of criminal activities could have been reported to the police by these bosses.

And thus, although the bosses may not directly be involved in the illegal activities, if they really wanted to know what was going on at the branch and if employees would refuse to inform they, the bosses could have fired the employees or ask the help of the criminal justice system to investigate any possible misbehaviour. And because they didn't do this, they accepted any possible criminal activities that were going on (of which the general public already has a long suspicion that it happens). Still, I accept the bosses seem to be involved in a restructuring of many branches, for instance by getting rid of country heads and indeed, people can't be held responsible for past criminal activities and by those done by others on condition that actions are taken when there is suspicion that criminal activities are happening; nevertheless, let's hope that the restructuring didn't mean getting rid of independent people to replace them with ruthless ones. (I have to admit, I have lost almost all faith in big bankers because they continue their business as before until it gets exposed while as they are directly involved in the system, they know better than anyone else that one of the reasons for the crisis was the result of criminal activities committed by some (too many) and thus they should expose those who are committing crimes if they want to save their reputation).

Indeed, following quote is remarkable:

"The individuals that I think are most accountable both for the data theft and the weakness that allowed that to happen, and for the behaviour that was unacceptable in relation to our standards, were the management on the ground in Switzerland".

To me, this seems to suggest they are angry the local managers could not prevent that the tax avoidance schemes became known (= due to data theft) because they were unable to control all their employees (= weakness that allowed the theft to happen) and thus standards were broken (= clients were exposed). But as mentioned higher, my distrust for banks may make me read something different from what it means.

The bosses could now decide not to accept any bonuses because of their failure to interfere in the branch to avoid the corruption happening, and people would take them serious. Because, it is not because a country allows corruption that companies should embrace this. But as the bosses want their huge bonuses (the reaction of one boss at the committee investigating the extend of HSBC's misbehaviour when he remembered how he ones returned a £1.75m bonus indicates he may not do that this time), in effect they want that the bank makes profits and thus cannot be taken serious when they claim they condemn these facts happened as these facts resulted in higher profits. Saying today this can no longer happen is ridiculous as long as those responsible for these actions are not stopped by being fired (without golden handshake) or even brought to justice. Also their comment in the same article that in fact the real scandal is that the data about the criminal activities were stolen and made public illustrates that, if it was not known to the public, it could have continued. And this happens while these people demand that ordinary people pay their taxes while governments should become smaller and thus cheaper to allow more tax reductions. Another interesting fact is that the banks do not operate on personal responsibilities but everything is collective responsibility and thus individual bankers can't be punished unless their actions damage the payments of the other bankers. Thus, as long as banks don't fail, bonuses can be paid because collectively the profits can be used in good times while savings of ordinary people can be used when banks make losses. No, their greed reached such a proportions we can expect anything except compassion for ordinary people who loose everything in this crisis. Because they deserve their bonuses, isn't it? And thus, the "horrible reputational damage" the bank has suffered after these revelations is probably not because the bank had the wrong ethics but because they hired a man who they failed to recognise as someone who would refuse to do the same as the others and thus exposed the misbehaviour of the bank and its clients.

And people are starting to notice things are going seriously wrong as this (Flemish) article illustrates where a young man writes about his anger of what is being done to the current generation while, reading the comments section shows that many of the older generation really don't seem to understand how bad the situation is. Indeed, the previous generation hopes their children will be successful and thus they invest in their education. The parents tell their children that when they die the children will be able to sell a very expensive house. But the previous generation still doesn't understand that after some of them retire at the age of about 50, they may still live another 50 years before their children can sell the house, thus when they are about 75 years old, too late to really enjoy life. And that is the joke of life: parents (although not all) hope to leave something behind for their children such as savings while these children will not be able to profit during their young life because prices have risen too high for many to be able to build a future for themselves. In the past, after the last great war in Europe, people understood inequality can't be too large and thus social security was introduced for the weak; as a result, peace lasted for a long period while now in many countries this system is dismantled on the demand of the rich while many approve. And indeed, although some people profit from the system, most do not as receiving benefits doesn't make people rich. And then there is the pressure from parents to have a return for their investment and blame their children if they can't find a well-paid job. And thus there is an older generation that could save very well during the good times and can profit during their retirement but is unable to see how difficult life becomes for their children. And if the older generation accepts there are problems, then many can't stop blaming the people coming from poorer regions faraway but also close to home, thus putting more pressure on their own children when they don't succeed. Finally, while the younger generation understands the science of climate change and the consequences of the destruction of our environment, many of the older generation still thinks that nature is a never ending story while they should know that over the past generations lots of our planet has been destroyed by humans. It now seems scientists think climate change may be partly responsible for the troubles in the Middle East. And thus troubles can also be expected elsewhere such as in California and the regions around Sao-Paulo and Rio de Janeiro in Brazil if draughts continue in those regions. In the past, the older generation feared the prophecies of the Revelations, and now things are changing, people think they are rubbish (until it becomes obvious). And thus all these problems lead, as the article suggest, to an increase in people killing themselves while a continuing crisis may result in fights and an unsafe society whereby parents will cry for the loss of their children and grandchildren. If only the older generation would thrust their children more when the younger generation believes in a mixed multicultural society that uses renewable energy and protects the environment instead of killing it to pose as old-fashioned machos in front of death elephants or lions. But equally the younger generation is not guilt-free as they too defend youngsters who cause disruptions to those who try to help them as I experienced as a teacher. And although I understand that some of these disruptive youngsters are trying to find their own way in an ever more unsecure world and thus are unsecure themselves and need help, many knowingly disturb others while this should not be tolerated. Because there are also youngsters who live only for themselves and not for others.

And thus, many nice people may kill themselves when this crisis continues and their parents will cry and curse themselves for not having seen it coming. Other children go to warzone and parents are angry they didn't spend more time loving their children. There will be children will need to steal or deal to have a decent level of living and thus may shame their parents. There will be the lucky ones who join companies for big profits while many other children may die in revolutions until people will demand again a more equal society, not only amongst humans but also with all other things on this planet.

This is why I have little respect for those rich who take ever more from society while only return little (or they couldn't become even richer). Some wealthy tax avoiders return some money to society via Foundations or promise to leave their wealth to society after their death although this can still take a long time while they could still live a nice life with less. But while some wealthy return part of their wealth, many of the bankers didn't achieve much except that they brought down a world economy while return as little as possible to maximise their own profits. Indeed, they are employees but think they are employers. They work for companies still think it is their own company. They pay themselves huge bonuses while fire ordinary people working for the bank because the company for which they work needs bigger profits or struggles to survive. And they have no remorse for 'the weak' who kill themselves while companies and even countries struggle and need to fire people in order to try to survive in this economic crisis. It is even amazing that now the UN demand people should eat less sugars and fat while there are people who struggle to eat two meals a day and thus need fatty and sugary food to survive until the next day. And while people struggle, those powerful people continue as before: getting richer at the expense of others.