“Mr. Diamond’s fall was spectacular and complete. It was also entirely appropriate. Dennis Kelleher of Better Markets, a financial reform advocacy group, summarized the situation nicely in an interview with the BBC World Service on Tuesday. The controversy that brought down Mr. Diamond had to do with deliberate and now acknowledged deception by Barclays staff with regard to the data they reported for Libor, the London Interbank Offered Rate.

Mr. Kelleher was blunt: the issue is “Lie More,” not Libor (pronounced LIE-bore).”

…

“Mr. Kelleher of Better Markets has the economics exactly right. Global megabanks have an incentive to deceive customers, including both individuals and nonfinancial corporations. Their size confers both market power and the political power needed to conceal the extent to which they engage in economic fraud. The lack of transparency in derivatives markets provides them with an opportunity to cheat, but the abuses are much wider – as the Libor scandal demonstrates.”

…

Read Simon Johnson’s full story here