With the four-year anniversary of the financial crisis approaching,
Wall Street thought it had dodged a bullet. Now comes the Libor scandal.
The esoteric practice of banks “fixing” the price of the London Interbank Offered Rate (more on Libor in a bit) may have heads rolling — and hard time being served — unlike “sexier” bubble-era improprieties like selling toxic debt to the unsuspecting.
Since the 2008 collapse, not a single major US bank CEO has been removed from his job, much less charged with a civil infraction over these activities. (Ken Lewis left Bank of America over other issues.) We’ve had one failed prosecution of two Bear Stearns managers and lots of wrist slaps such as the one to Goldman Sachs a couple years ago for selling some lousy mortgage debt to clients. And that was about it.
The esoteric practice of banks “fixing” the price of the London Interbank Offered Rate (more on Libor in a bit) may have heads rolling — and hard time being served — unlike “sexier” bubble-era improprieties like selling toxic debt to the unsuspecting.
Since the 2008 collapse, not a single major US bank CEO has been removed from his job, much less charged with a civil infraction over these activities. (Ken Lewis left Bank of America over other issues.) We’ve had one failed prosecution of two Bear Stearns managers and lots of wrist slaps such as the one to Goldman Sachs a couple years ago for selling some lousy mortgage debt to clients. And that was about it.
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