Dodgy bankers get off with fines while online gambling execs face jail time

hsbc-bankers-walk-online-poker

hsbc-bankers-walk-online-pokerThe head of compliance for Europe’s biggest bank, HSBC, has resigned following admissions that HSBC looked the other way while its subsidiaries laundered billions of dollars through HSBC’s US-based operations on behalf of Mexican drug cartels, countries on US sanction lists as well as banks in Saudi Arabia and the Indian subcontinent with ties to known terror groups. (We humbly suggest that HSBC rebrand itself: “Holy Shit! Bankers Corrupt!”)

On Tuesday, David Bagley, a 20-year HSBC veteran and head of (non)compliance since 2002, told a US Senate Homeland Security and Governmental Affairs Committee hearing that, you know, HBSC was, like, really sorry for having “fallen short of our own expectations and the expectations of our regulators … in hindsight, I think we all sometimes allowed a focus on what was lawful and compliant rather than what should have been best practices.” Translation: things sure have changed here on Walton’s mountain, and gosh golly gee, we’ve certainly learned our lesson, which would be to ‘find better ways of disguising such shenanigans in future.’

For putting profits ahead of, er, everything, HSBC will likely face a hefty fine – or, more accurately, what you or I would consider hefty, but what a global banking titan that made $16.8b profit in 2011 would consider filing under ‘incidental’ expenses (net result: this year’s company retreat will be serving domestic champagne instead of that fancy imported stuff). More to the point, the notion that any HSBC exec will face actual prison time for enabling Mexican drug cartels and/or Islamist terror cells to continue beheading their foes is about as likely as a Mexican drug lord or Lashkar-e-Taiba member appearing before the Committee to sincerely apologize for their roles in publicly embarrassing HSBC in this manner.

The HSBC debacle follows hot on the heels of the scandal at Barclays bank, which was fined $450m after its traders were caught flagrantly manipulating the London interbank offered rate (Libor). That bit of chicanery earned substantial dividends for Barclays while negatively affecting the bottom lines of average consumers, who were left paying higher rates for mortgages, credit cards and student loans. The US Department of Justice is currently widening its investigation to see how many other banks were in on the rate-rigging fun, but despite the damage inflicted against Joe and Jane Q. Public, the New York Times cited insiders suggesting the investigations are expected to result in settlements rather than indictments.

At the risk of stating the obvious, shall we compare the expected fates of the misbehaving bankers with their counterparts at online gambling companies whom the DoJ has threatened with century-plus stints in prison stripes? The comparison is even more galling when you consider that the online poker providers were originally targeted for providing US citizens with a service that said citizens actively sought out – a service that top US legislators are attempting to regulate so that domestic casino companies can reap the bounty. Is the DoJ seeking to extradite any UK bankers to the US to face criminal charges, or is that solely the lot of 24-year-old file-sharing students who earned the wrath of US digital rights holders? Gee, how would one describe that discrepancy…