The Old Boy Network seems Alive and Well

I'm getting mightily tired of the massive fines being imposed on banks (most recently for forex manipulation) not finding their way back to the people who were initially disadvantaged down the line.

I thought the financial regulators were altruistically set up to protect investors and strike a fair deal for them when they were wronged.

But instead it seems the banks continue with their dodgy practices and simply see these fines as a cost of doing business - I doubt that the fines represent more than a small fraction of the gains they actually make from malpractice.

And I can't help noticing what a lucrative industry governance has become in its own right - and how many executives (probably the majority of them ex-bankers themselves) are now doing rather nicely in both the States and here in the UK (despite occasionally having to defer the icing on the cake through bonuses).

In my most cynical moments, I'm convinced there's collusion between the City and its watchdogs*.  While hoodwinking the man in the street by creating the impression that everyone's playing by the rules, it's a perfect ruse for the fat cats to carry on pretty much as they did before - same greed, brighter halo.

They're not alone, of course - charity executives are also capitalising on the plight of those further down the food chain and the likes of Tony Blair are doing alright by picking up on both sides of their meddling as well (I wrote about the latter here).

I live in the hope that God ultimately won't help those who help themselves at other people's expense.

It's since been announced that the Government is allocating £100M from the LIBOR manipulation fines to military and emergency service charities.  Charitable donations by stealth from borrowers and investors to people whose pensions have ironically been decimated by the banks' other dodgy dealings. Blood money?

* If more proof is needed, welcome Attorney General Eric Holder of the SEC to the above club - a classic case of "working" with bad banks like JPMorgan Chase.

UPDATE (4 Jan '16): Another one under Blair's wing - David Miliband pockets big bucks from refugee misery.

You're not quite off the hook yet, Santander

After our action group had a win over Santander in their attempt to hoodwink us on Business Banking charges, you'd think I'd be done with beating them up for a while.

Not so.  From tomorrow, they intend to inflict more pain on 400,000 mortgage customers by increasing their standard variable rate ('SVR') by half a percent to 4.74%.  Oh, and yet again, they've reneged on a promise - that the SVR will be never be more than 3.75 percentage points above the Bank Rate - by raising the cap.  The words 'guarantee' and 'promise' obviously don't translate well into Spanish.

Their reason?  They say 'the cost of providing mortgages has risen over the past three years'.  And why?  Because of the 'need to meet tighter regulatory demands, which in part require them to build up a bigger capital buffer'.

The irony is killing.  Why has governance made organisations such as these so top heavy cost-wise in the first place?  Because they couldn't be trusted to give their clients a fair deal on their own.  You can you imagine the contempt they must have held for investors and borrowers alike, to have to be TOLD to treat them fairly - isn't the first rule of business to build trust and goodwill with your customers if you want them to come back?

Coming from the days when retail banking was a profession I proudly represented as a regional manager in Australia, I've now become totally disillusioned with the banks.  Instead of putting service first, they bombard us with reams of the small print that we all fought to eliminate a few decades ago (whatever became of the 'Crystal Mark'?), in which they disguise strategies deliberately calculated to catch us all out at some time or another - just ask any small investor who, perversely, has to change banks every year if they want to avoid an automatic rollover offering only fractions of a percent.  As BBC Watchdog pointed out, they actually rely on us not to check the anniversary of our investments in the hope that we don't notice.  Not to mention their heavy sales techniques (driven by target not need, as evidenced by recent mis-selling scandals).

Now, I can't understand why the banks aren't making money.  Back in 'my day', banks and building societies could lend out around ten times the amount they held on deposit, on the basis that not everyone would want to draw on their investments at the same time.  So why, when the investments they're offering paltry returns on can generate multiple parcels of borrowing at a higher rate, are they crying poor?  Could it be something to do with needing to replenish the coffers of the investment arms they so irresponsibly decimated? - and which they are now so reluctant to separate from their high street business?

Make no mistake - Joe Average is paying for 'The 1%' to shaft him again and again.  Someone pass the KY.