London 12.08.2012 – Recent news items have left me truly shocked. Perhaps I still struggle with the naiveté and ignorance that often accompanies one’s cultural upbringing in a developing country. Upon arriving in these so-called “civilized and advanced” societies, there’s an initial belief that the law is upheld by everyone. However, the reality is quite the opposite.
London, once the capital of the vast British Empire, is a pinnacle of sophistication. Culturally, socially, artistically, financially, and politically, it stands as a juggernaut. There’s no denying its historical significance; nearly everyone who matters has spent time in this magnificent city. Yet, like anywhere else, goodness coexists with evildoing. A stroll through Knightsbridge, Mayfair, or Chelsea reveals ostentatious displays of wealth often amassed by individuals who likely didn’t earn it, but rather acquired it through dubious means in under-developed regions like Africa, the Middle East, and Latin America. This city is rife with bankers who eagerly welcome these unsavory characters, readily offering their expertise in money laundering to partake in ill-gotten gains.
But I digress. What shocks me is the striking similarities between certain individuals and institutions in corrupt countries like Venezuela, and those in the UK. Enter Standard Chartered. Back home, we say: “lo agarraron cagando y sin papel,” which translates to “getting caught with your pants down and without toilet paper.” Essentially, Standard Chartered was caught red-handed. According to Benjamin Lawsky, New York’s superintendent of financial services, Standard Chartered has been flouting Office of Foreign Assets Control (OFAC) restrictions for almost a decade. The accusations against Standard Chartered (SBC) are quite severe:
falsifying business records;
submitting false documents;
failing to keep accurate records of all transactions and actions taken by SCB;
hindering governmental procedures;
not reporting misconduct promptly to the Department;
evading federal sanctions;
and numerous other legal breaches that, similar to the above, impact SCB’s stability and the Department’s faith in SCB’s character and integrity as a licensed financial institution.
As a result, SBC has seen more than $9 billion, or around 16
percent, erased from its market value. Some believed, until recently, that SBC was a model institution, in stark contrast to other banks involved in various scandals in recent years, like Barclay’s LIBOR scandal, HSBC laundering for Iran and Mexican drug traffickers, and others. The bankers have been running rampant with no real consequences. In today’s world, banking is a collective game where profits take precedence over ethics. There’s no accountability—no arrests, no charges—just a series of futile bureaucratic showdowns, followed by insignifcant fines that barely scratch the surface of the true amounts involved in unethical dealings.
Regions with ineffective law enforcement become havens for criminals, as the incentive for illegal activities often surpasses the fear of getting caught. In some instances, criminals essentially govern the land. Libya, Zimbabwe, Venezuela, Cuba, Russia, China, and Iran serve as prime examples. The UK is touted as a modern nation ruled by law and democratic principles. Unfortunately, it seems similar to those other countries, as thugs who have devastated lives in places like Venezuela have connections here and are eager to conduct business. Consider the likes of Tony Blair, Gordon Brown, or Prince Andrew—the list goes on.
When SBC leaders were warned about the implications of breaching U.S. regulations, their response was, “You bloody Americans. Who are you to tell us, the world, who we can or cannot trade with?” SBC executives, led by Peter Sands, who was once tipped as a potential successor to Mervyn King at the Bank of England, seemed to think that the “bloody Americans” have no authority over them. Yet, they utilized the “bloody American” dollar in their transactions, leaned on the “bloody American” market, and operated within the “bloody American” financial ecosystem.
The key point here is that SBC was found violating U.S. law while operating in America. Even if we were to give SBC the benefit of the doubt—despite recent history suggesting otherwise—they claim only $14 million was associated with illegal transactions with Iran, instead of the $250 billion mentioned by Lawsky. Their defense isn’t that they didn’t breach OFAC restrictions, but rather that they only did so for $14 million. That’s quite the moral defense, isn’t it?
However, just as criminals in Venezuela face no repercussions under the corrupt leadership, SBC faces no consequences here. To me, this realization is deeply disheartening. SBC, in effect, is enabling criminals responsible for immense suffering globally. The British have a notorious history in this regard, whether in Libya, Kazakhstan, or Iran; locals’ welfare seems irrelevant when millions are at stake.