It is only when you start to look into why that it becomes clear that this is of central importance. In case you missed it Deutsche Bank were one of a number of banks that manipulated the LIBOR rates. That means that they fixed very slightly the rate of interest that was charged in London for lending between banks overnight. As a statement that must rank amongst one of the least interesting pieces of prose I have ever written. As an act of theft it was truly monumental.
The fine the regulators imposed on Deutsche Bank was £1,700,000,000. Yes you read that right - they really were fined £1.7bn. By comparison one of the worst FIFA scandals involves an accusation that £10m might have changed hands. That makes that piece of corruption 170 times smaller. Deutsche Bank were part of a syndicate that fixed the most important interest rate in the world in such a way as to ensure that the bets of their own traders on where interest rates would end the day won a lot more often than they lost. Since there were at least four other banks heavily involved you can imagine how much money was being made. I think when we get to the bottom of it we will find that we are dealing with a major crime that went on for years and resulted in sums of money being pocketed that will prove to be around 1,000 times as great as the total sums of FIFA corruption.
We are by now used to the idea that banks behaved badly during the 2008 financial crisis but we are regularly told that they are cleaning up their act and this sort of thing couldn't happen again. This particular crime was still taking place long after the 2008 financial crisis had nearly succeeded in destroying the capitalist system.
After an experience that scary you would think that world leaders would take serious action to tackle the problems. You would have thought that they would be working flat out to ensure that nothing similar can ever happen again. The LIBOR scandal shows that the culture of arrogance continues unabated. Traders and their bosses know that if they pull off their complex financial deals they will pocket huge salaries and bonuses and if they go wrong or they are found guilty of the most monumental deceptions then very little will happen to them personally.
You would think that a chief executive of a company that was fined £1.7bn for fraud would go to jail. Not a bit of it. The joint chief execs are being allowed to move on gracefully. There is no word I can find on how much their severance pay will be. More importantly there seems to be no threat of legal action against anyone who was in serious authority when this crime was committed.
There is apparently a reason for this. According to the Independent "Deutsche has always said its senior managers did not know what its traders were doing." The staggering nature of this statement deserves to be headline news. The people in charge didn't know what their traders were doing with billions of their money and they consider this a legitimate defence. I was always told that ignorance is no defence. Maybe when ignorance hits this scale it becomes heroic! The people in charge of one of the biggest and most important banks in the world are happily telling us that didn't have the first idea of what was happening in the organisation they controlled. If so they should be charged with criminal negligence. If they did know what was going on and chose to turn a blind eye to it then they are guilty of fraud. Either way we are not dealing with people that you'd want to trust with your money. Nor are we dealing with a financial system that has been purged, fixed and humbled into becoming responsible.
The international financial system is out of proper control. Any serious business person who wants the economy to function efficiently and to avoid repetitions of dangerous booms and busts will find this a deeply scary statement. Business needs the financial system to be honest reliable and efficient and at the current moment it is none of those things.
Deutsche Bank is under investigation for laundering £6bn worth of trades by Russian clients via its London and Moscow offices. It would appear that they thought that making money that way was a perfectly normal thing for a legitimate business to do. Yet HSBC is currently threatening to leave the county unless the controls on banks are weakened. This is the same HSBC that helped to fix the LIBOR rate. The same HSBC that helped to fix the foreign exchange markets. The company that is awaiting investigation of whistle blowing evidence of helping clients to avoid huge tax bills. The organisation named as having helped FIFA to launder some of its corruption payments and which is named in many other money laundering cases.
Our country faces a choice. We can give in to the demands of the banks and leave in place a system of financial regulation which generated an enormous crash, led to eight years of austerity and has produced a culture of corruption and of manipulating markets. Or we can regulate them properly and enforce those regulations in the courts. That might just start the long hard job of moving our country onto a more secure and stable economy making products and services that help us adapt to a low energy sustainable future.
With this government in place I will not be holding my breath.