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January 31, 2012

UK Political Stunt Pretending to Get Tough on Banksters

I can hear Jamie Dimon crying now, “When, when, when will the unjustified, Draconian punishment of noble bankers end?” 

The former boss of the Royal Bank of Scotland, Fred Goodwin is the recipient of the latest “punishment.”  He presided over the collapse of RBS and it’s de facto nationalization.  His punishment?  He is going to be stripped of his knighthood.  Now, that’s getting tough!

According to a report by the Financial Times, “Sir Frederick Anderson Goodwin – or plain Mr Goodwin from now on – was given his honour for ‘services to banking’ in June 2004, with the approval of Gordon Brown, then chancellor of the exchequer.”

This would be less of a joke if it wasn’t done as a political stunt to provide cover for the Prime Minister who was taking a lot of heat for a huge bonus to be paid to the current CEO of RBS:  “David Cameron announced the referral to the committee on January 19, which was also the day that news broke of plans to pay Stephen Hester, Sir Fred’s successor at RBS, a bonus of about £1m. Mr Cameron said the forfeiture committee would look at the Financial Services Authority’s December account of the collapse of RBS, which he said was ‘material and important because of what it says about the failures of RBS, what went wrong and who is responsible.'” 

Bravo for the Financial Times, which called this for what it was:  “the move was widely seen as a smokescreen to cover the government’s growing embarrassment at its inability to control bonuses at the bank, which is now 83 per cent owned by the taxpayer.”

Read the full article here.

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