Tag: Financial Folly

We Bankers Said We’re Sorry — Now Buzz Off

On By southwerkIn business ethics

Alain Sherter writes a column called Financial Folly. His latest essay is entitled – Barclays CEO: We Bankers Said We’re Sorry — Now Buzz Off.

New Barclays (BCS) CEO Bob Diamond is tired of apologizing for the economic damage big banks have wrought in recent years. As he told members of Britain’s Parliament during a hearing on possible restrictions on banker pay:

“There was a period of remorse and apology for banks. I think that period is over,” Diamond told the Treasury Select Committee.

“Frankly, the biggest issue is how do we put some of the blame game behind us? There’s been apologies and remorse, now we need to build some confidence,” he added.

Seems to me Diamond, who took over last fall as chief executive at the U.K. banking giant, is skipping a step between expressing regret and rebuilding confidence. Tip of my tongue…. Ah, yes: reform. That includes restricting the kind of compensation that inclines bankers to let it roll. And since we’re nitpicking here, I don’t remember many financial executives exactly hanging their heads in shame over their role in the meltdown.

I don’t recall any real apologies or confessions of wrong doing or regret for what happened.

The general perception of the financial community is that they were profitable before the disaster, they didn’t really need the bailout and what was all the fuss about in the first place?

You may think I am exaggerating or misinformed about that my analysis of the attitude of the banking community. I truly wish I was wrong.

We have a financial class that not only can do no wrong whatever, but have no responsibility for anyone in this country at any time, under any circumstances. In their minds, they are worthy, the rest are not.

Their sense of entitlement is beyond most American’s comprehension.

If I had not heard these things said myself, I would have difficulty believing them.

James Pilant

Foreclosure Judges Fight The Good Fight

On By southwerkIn business ethics, ethics, Government Failure, Philosophy of Business, President Obama, White Collar Crime

Alain Sherter (who I do not write enough about) has a excellent column titled, “How Local Judges are Putting the Feds to Shame In Halting Improper Foreclosures.”

Here’s a selection from it –

Consider this astonishing stat drawn from a WaPo story today: Courts in the area are estimated to be dismissing upwards of 50 percent of foreclosure cases against homeowners because of slipshod — or outright fraudulent — paperwork filed by lenders. Banks are appealing many of these decisions, a sign of just how afraid they are the rulings could embolden courts around the country to follow suit:

In millions of cases across the United States, local judges have wide latitude to impose sanctions on banks, free homeowners from their mortgage debts or allow the companies to proceed with flawed foreclosures. Ultimately, the industry is likely to face a messy scenario — different resolutions by courts in all 50 states.

Sherter puts his finger on what I try to communicate to my classes. Attorneys and Judges are not the Ogres portrayed on television. It is true that are some very, very bad attorneys. I hold them in contempt. But you would be astonished and impressed by the attorneys I’ve met who fight for their clients for little money, sometimes no money. This whole mortgage foreclosure mess would never have come to light, if it weren’t for attorneys working for next to nothing trying to keep people in their home.

He makes another point in both the title and inside the article.

Federal bank regulators are equally intent on keeping the foreclosure assembly line moving. That’s no surprise, given that they’re deeply implicated in the foreclosure mess. For instance, state financial supervisors turned to the OCC in 2007 after JPMorgan Chase (JPM) and Wells Fargo (WFC) stonewalled their investigations into improper foreclosures.

Not content to simply ignore the problem, the OCC actually made it worse. Protecting its authority to oversee national banks, a doctrine known as “preemption,” the agency shooed the state enforcers away. Then it asked the banks to look into the matter.

I said exactly the same thing in one of my posts – If you are waiting for the Obama administration to come your rescue, you are going to be waiting a long time.

James Pilant