Economy

Sins Of The City: Bankers Caught Red-Handed - Again

Essay: As the Barclays "Libor-gate" financial scandal unravels, France's leading business daily says it's time London lawmakers and City bankers should stop lecturing continental Europe and take a good hard look in the

Really? (EG Focus)
Really? (EG Focus)
François Vidal

PARIS - It's the story of a habitual offender. Once again, finance was caught red-handed, just like the small-time delinquents who promise the judge never to do it again but are unable to control their own impulses. Only a few weeks after JP Morgan's billion dollar trading loss, Barclays is accused of organized fraud on one of the credit market pillars, the Libor.

Barclays, one of the main banks in the City (several other London institutions are also suspected) knowingly helped falsify the interest rate that is the baseline to most commercial transactions and financial products. This is market fraud, and the technical nature of the problem shouldn't hide its importance.

This "Liborgate," which has undoubtedly barely started, is one of the most serious financial scandals since the beginning of this scandal-rich crisis. Even if the financial stake is much lower, it is very similar to the subprime scandal because of what it reveals about the attitude of international finance. A world in which well-established companies can organize institutionalized fraud in order to preserve their interests, in contempt of those of their clients and of society as a whole. It is a universe where the end always justifies the means.

This is also proof that the City, so eager to lecture continental Europe on its banking, should take a look in the mirror. After this scandal, how can you explain to taxpayers who poured billions of pounds, dollars and euros into the financial system that it has learned from its mistakes? That its culture has changed?

Barclays C.E.O Bob Diamond will surely fall, like others did before him. But that won't be enough to fix the broken trust. The financial world has to be brought to heel because it is has no self-discipline. First through much stricter regulation that will incorporate market finance instead of placing it into an incontrollable no-man's land that cuts banks in half. Just as important is strengthened supervision. It is obviously impossible to put a regulator behind each banker. But it is urgent to instill a much deeper fear of regulators in the sector by punishing abuses much more harshly.

Read more from Les Echos in French.

Photo - EG Focus

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China

Peng Shuai, A Reckoning China's Communist Party Can't Afford To Face

The mysterious disappearance – and brief reappearance – of the Chinese tennis star after her #metoo accusation against a party leader shows Beijing is prepared to do whatever is necessary to quash any challenge from its absolute rule.

Fears are growing about the safety and whereabouts of Peng Shuai

Yan Bennett and John Garrick

Chinese tennis star Peng Shuai's apparent disappearance may have ended with a smattering of public events, which were carefully curated by state-run media and circulated in online clips. But many questions remain about the three weeks in which she was missing, and concerns linger over her well-being.

Peng, a former Wimbledon and French Open doubles champion, had been out of the public eye since Nov. 2. 2021 when she penned a since-deleted social media post accusing former Chinese Vice-Premier Zhang Gaoli of sexual misconduct.

In the U.S. and Europe, such moments of courage from high-profile women have built momentum to out perpetrators of sexual harassment and assault and give a voice to those wronged. But in the political context of today's People's Republic of China (PRC) – a country that tightly controls political narratives within and outside its borders – something else happened. Peng was seemingly silenced; her #MeToo allegation was censored almost as soon as it was made.

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Support Worldcrunch
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