Barclays bank didn’t just scam other financial giants

[lovuian]

Barclays, the British bank, forced out its chairman and paid $450 million in connection with a fraud investigation. This is a very big deal because, in all likelihood, you were a victim.

While financial scams have taken a toll on the economy, they have often been sharks-ate-sharks affairs. When a Goldman Sachs rigs up trading in mortgage securities, one rich guy gets richer and one gets poorer. When a J.P. Morgan loses, oh, $9 billion in trading, shareholders take the hit.

Barclays helped nick virtually everyone who has a credit card, mortgage or student loan. That’s because interest rates on these loans are pegged to the London Interbank Offered Rate, or LIBOR.


http://www.nydailynews.com/opinion/barclays-bank-scam-financial-giants-article-1.1106700#ixzz1zfD8u59v

[OnyxCollie]

1. K&R. nt

[PoliticAverse]

2. There is going to a huge number of law$uit$ over this with Barclays being on the wrong end. n/t

[stockholmer]

3. LIFE IMPRISONMENT for the ALL the bankster scum, not just civil suits, nail their arse to the wall

You either remove the cancer that is system global banking control (including their central banks), or the cancer is going to kill you.

It is that simple, all else pales in comparison. All major anti-humanistic practices (empiric never-ending wars, track-trace-database police state grid, global debt peonage, neo-feudalism, posioned, poluted planet, etc etc) flow from the maw of the money-changers.

[raouldukelives]

12. Not only do they create the virus. They profit from the cure.

Everyone is a victim of this. The exploitation and destruction of our greatest natural resources in the blink of an eye. The poisoning of our water tables & degradation of soil. The lax controls on chemicals in the products we consume each day. The warping of our very climate. The destruction of all of our futures for some extra digital money dots on a hard drive. From the food we eat, to the investments we choose, to the emissions we leave behind we all do our part. Placing little bets with the moneychangers in the hopes we can share in the receipts of misery.
Of course if all of this destruction and pollution causes you to become sick. Don't point fingers at them. It was your bad luck to be born near a waste disposal site of our vaunted system.
They cannot be reasoned with, they pay far to well to be exposed to reality.
They cannot be made to pay, they would only collapse and send us the bill.
They cannot be made to stop unless we choose to stop ourselves.

[Coexist]

4. knr

[elehhhhna]

5. That Chairman was going to host a bg LONDON fundraiser for MitWit

[malaise]

6. The CEO Bob Diamond

On Tuesday, July 3, Barclays announced the resignation of CEO Bob Diamond, effective immediately. His departure follows the resignation of Marcus Agius, the bank’s chairman, who will remain in his post until a new CEO is found to replace Diamond. CNBC reports that Diamond “has pulled out of hosting a London fundraiser for Mitt Romney, the Republican presidential nominee, as the bank faces growing pressure over its role in the price-fixing of lending rates.”

from
http://billmoyers.com/2012/06/29/in-london-mitt-banks-on-the-wrong-horse/

[arikara]

13. Is that legal

to fundraise for the US presidency in other countries? I've never heard of it, but I'm Canadian. I sure hope they couldn't/wouldn't do it for that prick Harper.

[FarCenter]

17. Diamond is a US citizen. Location doesn't matter as long as donations are from US persons

[FarCenter]

20. He's US/British citizen, but I think it is still OK. I'm pretty sure US/Israeli citizens contribute

http://www.forbes.com/sites/halahtouryalai/2012/07/02/barclays-bob-diamond-the-american-defying-london/?feed=rss_home

[creeksneakers2]

7. I think that they conspired to make the LIBOR lower

That would have saved student loan or credit card borrowers whose rates were pegged to the LIBOR money. Depositors were the ones who would have taken a hit.

[dipsydoodle]

8. I'd misread what you said

[FarCenter]

10. Just like the Fed, the Bank of England wanted lower rates to lessen the impact of the crisis

However, the Bank of England doesn't control LIBOR in the same way that the Federal Reserve influences rates through setting the overnight rate and by other "open market operations".

Therefore, the BoE (and maybe Treasury) did a wink, wink, nudge, nudge with the banks to get them to lower LIBOR. In the US political system this would be "jawboning", a technique where the word is passed by politician to companies to persuade them to do things that they wouldn't do of their own accord.

So yes, debtors were benefited by lower LIBOR, and creditors were harmed, although creditors holding longer term instruments would have benefited from capital gains.

The big impacts would have been on derivatives, and these go both ways depending.

The pre-crisis attempts at manipulation by traders was clearly linked to their derivatives positions.

[Lucky Luciano]

15. Yes - what you said. nt

[JDPriestly]

9. But if they were colluding to lower their rates, didn't that lower the rates of consumers

also? Isn't it the pension funds and small savers who lost?

Wouldn't the artificial lowering of the cost of borrowing to banks have lowered the cost of borrowing to those to whom the banks loaned money?

Or did the banks pocket all of the gains made from lower LIBOR rates to them?

Did the banks maintain high interest rates to their borrowers while colluding to lower the LIBOR rates?

The article does not elaborate from what I could tell.

[dipsydoodle]

11. It had happened in both directions

Marginal changes up and down meaning that some got better rates and other paid more.

Did the banks...........in some cases but in other cases to be able to offer lower rates for mortgages whatever.

Notwithtanding commissions which would account for the balance - those who lost are actually owed by those who won.

btw - to help understand other issues of Libor rates which Barclays used plough back through this : http://www.bbc.co.uk/news/business-18704239

[pansypoo53219]

14. no more virgins, we need to toss the top rung of the banksters into a volcano caldera.

[Crowman1979]

16. Maybe the Barclay's Premier League will go back to its original title of...

....Division 1!

[dtom67]

18. State and Local Gov't got hit ,too

All the big banks did this. The impact on the unfathomable realm of derivatives was the entire purpose; many state and local gov'ts got burned on what they thought were hedge bets against a bad economy. Just look at the bankruptcy of Jefferson county in ol' Bama...

Its ok, though. A little Austerity and everything will be all right...

[suffragette]

19. Barclays also received TARP money from AIG

Apparently they were in the 'too big to fail' club that needed huge amounts of tax money from the U.S. public so they could continue their financial wizardry. Though in the case of the TARP bailout, it was an indirect payment through AIG. I would venture that would have meant that not even the small regulatory measures imposed on the primary recipients of TARP, such as AIG, applied to them. And note, that AIG was not forthcoming about these TARP payouts to other banks, but only released the info after Congressional demands they do so.

http://www.politico.com/news/stories/0309/20039.html
By EAMON JAVERS | 3/15/09 7:40 PM EDT
Updated: 3/16/09 6:24 PM EDT

The documents AIG released account for some of the more than $180 billion in aid that AIG has received, and they detailed for the first time which financial firms are benefitting from the federal handout.

In all, AIG disclosed payments of $105.3 billion between September and December 2008. And some of the biggest recipients were European banks. Societe Generale, based in France, was the top foreign recipient at $11.9 billion, Deutsche Bank of Germany got $11.8 billion and Barclays, based in England, was paid $8.5 billion.

Here in the U.S., Goldman Sachs received $12.9 billion. Edward Liddy, the government-installed CEO of AIG, sat on the board of directors of Goldman Sachs until he joined AIG.

He took the position while President George W. Bush's Treasury Secretary, Henry Paulson — who until joining the administration had served as Goldman's chairman and CEO — arranged the insurance company's initial government bailout.



http://www.standard.co.uk/business/barclays-got-6bn-of-insurers-bailout-cash-6830088.html

16 March 2009

Deutsche Bank and Société Société Générale were the largest recipients with $12 billion each while Barclays received $8.5 billion.
Barclays refused to comment on when it received funds from AIG, but postings from AIG indicate funds went to Barclays by the end of 2008.

~~~

responsible for Barclays being able to refuse help from the British taxpayer.
Barclays has been furiously holding on to its independence, even tapping Middle Eastern investors and selling a third of the bank to the sheikhs rather than go the route of Royal Bank of Scotland and Lloyds-Halifax Bank of Scotland, which have ended up being part-nationalised.

Banking analysts said the widespread nature of the payouts indicate the main reason the US Treasury moved to save AIG: if the US had not bailed it out, a string of the world's biggest banks might have collapsed.




In an article about Varley and Diamond taking 'lower" bonuses in 2010, Varley also admitted receiving "indirect state support" so who knows how much the UK citizens also contributed to Barclay's balance sheet, salaries and bonuses.

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/7252509/Barclays-bosses-John-Varley-and-Bob-Diamond-forgo-bonuses.html

John Varley, chief executive, will take only his £1.1m salary, while Bob Diamond, president and head of the investment bank, will earn just £250,000. Their last annual bonuses, in 2007, were £2m and £18m respectively. Mr Diamond has already earned $26m (£16.5m) from the sale of fund management arm Barclays Global Investors (BGI) last year.

~~~

Barclays is at the centre of the storm over bonuses because it is aggressively growing its investment bank, Barclays Capital. Sparking union anger, it confirmed that its 23,000 investment bankers would take home £191,000 each from a total pot of £4.4bn. They have been awarded another £1.2bn, or £52,000 each, in shares deferred over three years.

"Paying huge bonuses when people are still losing their jobs and business cannot get the loans they need because of a crash made in the finance sector goes against every concept of fairness," TUC general secretary Brendan Barber said. "It is not good enough for Barclays to say they did not receive direct aid. Policies designed to help banks rebuild their balance sheets have been used to pay bonuses."

In what was a watershed moment, Mr Varley conceded for the first time that Barclays has been the beneficiary of indirect state support, but he maintained he is at the mercy of markets over pay. "I am not denying that we have all benefited," he said, referring to Government liquidity and funding schemes put in place to ease the financial crisis.



That also raises important questions to me about how reliable/manipulated the numbers for the financial institutions stability/recovery are. How much of the numbers reported are actually money that was funneled to these institutions directly or indirectly from a variety of government (citizen's taxes) money at the same time the citizens of these countries faced loss of jobs, bankruptcies, cuts to social and retirement funds, whether under the official label of austerity or not?

[dipsydoodle]

22. Were the funds from AIG into Barclays

paid as a result of credit default insurance ?

[suffragette]

23. What I've read is "securities lending"

http://www.nytimes.com/2009/03/16/business/16rescue.html
The list released by A.I.G. on Sunday, detailing payments made between September and December of last year, could bolster that justification by illustrating the breadth of losses that might have occurred had A.I.G. been allowed to fail. Some of the companies, like Goldman Sachs and Société Générale, had exposure mainly through A.I.G.’s derivatives program. Others, though, like Barclays and Citigroup, stood to lose mainly because they were customers of A.I.G.’s securities-lending program, which does not involve derivatives

More info on how AIG ran securities lending here:

http://www.theracetothebottom.org/securities-issues/the-bailout-of-aig-and-the-securities-lending-business-a-dou.html

[dipsydoodle]

21. "Victims" needs defining

The BBA was aware that banks including Barclays were low- balling their Libor submissions during the financial crisis to avoid the perception they were struggling to borrow cash, according to CFTC documents.

http://www.bloomberg.com/news/2012-07-03/diamond-s-exit-shows-libor-only-what-each-bank-says-it-is.html

That would mean loans whatever where subsequently provided to and by other banks at lower rates than might have been appropriate.