HSBC is Not and Never Was Too Big to Prosecute



By now we all know the Eric Holder statement that HSBC (Hongkong and
Shanghai Banking Corporation) was just too large to prosecute without the financial
world falling apart. Under oath, he told the Senate Judiciary Committee just
that. That story is four months old now and perhaps the news-cycle is busy
enough with other matters for my opinion to be heard.

 

Holder is wrong for a bunch of reasons, but his major wrong is that HSBC
would have purred along just fine if it’s top fifteen executives had been
indicted and, after ‘due process and a jury of their peers,’ found themselves
stamping out license plates for twenty or thirty years.
Case in point:
Ann Almeida, Group
Head of Human Resources and Corporate Sustainability
Samir Assaf, Chief
Executive, Global Banking and Markets
Irene Dorner, President
and Chief Executive Officer, HSBC USA
Pam Kaur, Group Head
of Internal Audit
Alan Keir, Global
Head of Commercial Banking
Stuart Levey, Chief
Legal Officer
Antonio Losada, Chief
Executive of Latin America and the Caribbean
Marc Moses, Group
Chief Risk Officer
Sean O’Sullivan, Group
Chief Operating Officer
Brian Robertson, Chief
Executive, HSBC Bank plc
Peter Wong, Chief
Executive, The Hongkong and Shanghai Banking Corporation
Are we up to fifteen yet? Not quite, but twelve will serve for the
argument. I have no idea if any of these top execs are or were guilty of indictable
banking offenses, but the HSBC website touts them as senior management, so they’ll
have to do as placeholders for the argument. There is not one among them that,
if run down by a tram on the way to work, is irreplaceable. Every single member
of any large firm’s management has a #2 in the wings, well skilled to take over
responsibility. So, what’s my point?
My point is that we’ve been sold a bill of goods, told to hold our
noses and swallow. Worse yet, we’ve done just that. HSBC admitted to a string
of criminal offenses that would send any ordinary citizen to prison, probably
for life and struck a deal with the Department of Justice that admitted no wrongdoing and absorbed a
fine in the deal. A rather large fine, about which the DOJ crowed from the
chicken-coop—amounting to seven weeks profit. Seven weeks and a walk. Seven
weeks
and no one goes to jail, nor does anyone lose their job unless HSBC chooses to fire them.
Now, why does it matter? It matters for several reasons, the first of
which is that our entire process of punishable offense suffers when justice is
seen to target the small and give the big guys and girls a walk. Respect for
law—all law, from running a stop sign to committing or abetting murder—has its
basis in equity. If a hundred-dollar dealer goes to prison for twenty years and
a firm abetting thousands of murders by laundering and secretively hiding from
authorities the money that sustains drug-lords and terrorists takes a walk, we
lose faith in the law itself.
Secondly, we encourage the very thing we meant to discourage—repeated offense
charged off as ‘business expense.’ Bank after bank, Wall Street firm after Wall
Street firm has made a revolving door of criminal offense and the continuation
of business as usual, shrugging off the fines and increasing profits. Were executives of these criminal organizations
(there is no other word for them) sent off to prison terms, as are private
individuals, they would change their ways and continue to exist as large,
honest, highly profitable organizations.
Examples are legion, but the current poster-child for grinning from the
top is Jamie Dimon, Chairman, President and CEO of JPMorgan Chase, one of the
Big Four banks in America. According to the Wall Street Journal, the Federal
Energy Regulatory Commission (FERC) will fine Chase “close to $1
billion” for manipulating energy prices in Enron-esque fashion in Michigan
and California.[1] 
A
one-time unfortunate lapse? Hardly. In (very) recent times and under Dimon’s
leadership, Matt Taibbi discloses[2]
that JP Morgan Chase settled numerous fraud and criminal charges with no
admission of guilt and no indictments. Dimon, by the way, was named CEO of the
Year in 2011 and banked a $23 million pay package for fiscal year 2011, more
than any other bank CEO in the United States.[3]

All men are not created equal under such circumstances, but that needn’t
mean we leave the conditions of inequality in place. 



[1] J.P.
Morgan Staring at Record Fine Over Energy, Wall Street Journal, July 17, 2013
[2] Chase, Once Considered “The Good
Bank,” Is About to Pay Another Massive Settlement
, by Matt Taibbi, July
18, 2013
[3] Wikipedia,
Jamie Dimon

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