Is it time to stop bashing bankers? Continuing revelations of "cringeworthy behaviour" suggest not.

Is it time to stop bashing bankers? Have the crooks already been biffed out of the ring? Are we just hindering the new saintly bankers? As they clean up after the few bad apples who spoiled it for everyone else?
Of course not. And in saying this we are in good company:

Even the Governor of the Bank of England no longer believes in the "few bad apples" theory of rotten bankers. In November 2014 the Governor, Mark Carney, said:

"The succession of [banking] scandals means it is simply untenable now to argue that the problem is one of a few bad apples. The issue is with the barrels in which they are stored."

The Bank of England tweeted Carney's sentiments to its 120,000 or so Twitter followers to make sure as many as possible heard. Here it is, so you can retweet it too:

#FinancialStabilityBoard’s Carney says untenable to argue that problem is a few bad apples. It is the barrels in which they are stored
— Bank of England (@bankofengland) November 17, 2014

The Treasury minister responsible for the City of London said in July 2014:

"I think there's quite a long way to go to really change the culture.... I think we are still going to see a lot of cringeworthy announcements."

A report on "The Culture of British Retail Banking" in November 2014 by the Cass Business School and the think tank New City Agenda (founded by cross-party luminaries) stated banking suffers from:

"A toxic culture decades in the making [that] will take a generation to clean up."

This same report refers to an ethics study done in June 2013, several years after the banking crash, showing the big retails banks still swimming in a red sea of bad ethics.

The report helpfully provides a catalogue of scandals, starting when the banks started to crumble in 2007, that shows no sign of abating:

 

 

 

 

We end the list with "et cetera" because the report was written before the £2.6 billion in fines for FOREX rigging were imposed in November 2014.  

Doubtless there are more skeletons waiting to emerge from the banks' vaults. For example, the banks are still in denial about the destruction of small and medium businesses by the Interest Rate Swaps scam. Though thanks to pressure from the Bully Banks organisation and reportage including television documentaries by the BBC's Panorama and Channel 4 News and others it is likely the banks will be brought to account.

Sadly even the highly critical "Culture of British Retail Banking" report we referred to above has a dangerous seed of delusion in it, stating:

"The good news is that banks have made a positive start. The ‘tone from the top’ is there. But this alone is not enough. There needs to be a sustained focus on driving change down through all levels of the organization."

The "tone from the top is there"!? Really? Do they really think there is an officer class of saintly bankers struggling bravely against a host of sinning lower ranking staff? Certainly it would be easier for the authorities to believe they have put "decent people" in charge, so the authorities can sit back and relax. However even if the people at the top now weren't at the top during the worst banking excesses, they were certainly at the next level down. Promoted over decades of banking rip-offs, up through the ranks for being really good at all those banking rip-offs.

Their presence was made felt when in 2014 RBS was reported to have paid bankers in its Global Restructuring Group (GRG), accused of profiting by killing off UK businesses, £17million in bonuses. £17million for activities RBS bosses tried to smoke-screen when raised by Parliament's Treasury Select Committee. Resulting in a letter of abject apology from the RBS Chairman when the RBS top bosses were caught out.

Bankers' dodgy behaviour is driven by excessive pay. Does anybody with power want to do anything about pay? The banks themselves don't: the Parliamentary Commission on Banking Standards report published in June 2013 stated average pay per head in 2012 was actually much higher than it was at the height of excessive pay in 2007 just before the crash:

Nor does the British Government, who fought long and hard against EU plans to cap bankers' bonuses, only giving up in November 2014. Holding the trough up to bankers' noses wouldn't go down so well with the voters in the 2015 General Election.

Willie Sutton

Why do crooks go to banks? Slick Willie Sutton, American bank robber, explained "because that's where the money is". As it was then, so it is now.

People will be crooks if the rewards are great enough. Deal with the rewards, and the crooks will deal with themselves.

Until that happens, it will be too soon to 'move on' from bashing bankers.