[misiti3780]

Another slap on the wrist. No one goes to jail because of Deferred Prosecution Agreements

HSBC got fined about half that when they caught laundering money for the Mexican cartels a few years back. True story: HSBC had to design special teller windows because the standard ones were too small to fit the sacks of money that were being brought in and laundered. If you want to know why these guys don't go to jail, pull up a bottle of lithium and sit down with The Chickenshit Club.

[AtHeartEngineer]

It was 4.2 billion not million, it probably should have been more, but that's definitely not a slap on the wrist.

[repsilat]

Right. For context, that's around 9% if their $48 billion market cap. Much worse than sending any one person to jail.

Also: in the US, I've heard the "value of saving a life" for some decision calculations to be assumed at ten million dollars. That's $200k per year for 50 years. (In New Zealand, from talking to some civil engineers, it is a lot lower.)

At the American price, the fine is worth 420 human lives.

[black_puppydog]

I agree that this is more than a slap on the wrist, but I doubt that it's more effective as a deterrent than jailing the individuals involved. From what I understand, the banking industry is built almost entirely on a Rand'ian "every man for himself" ethos, with little attachment to the company involved. I don't see how you can then hope to incentivize these individuals by fining the company. Except if the suits were quick enough that most of them were still at UBS, to feel the consequences. But that's not desirable either.

[Vinnl]

I wonder if that's the case. I think the source of the problem is people prioritising the short term over the long term, and I'm not sure whether potential jail time in the long run will deter you when your direct environment is pushing you another way.

Instead, if the company risks fines like these, the environment of its employees may start to emphasise derisking more, to prevent them from being hit with new fines.

Of course, this is all just me looking into my crystal ball.

[robocat]

One NZ price that is just in the news is 4.7MM NZD.

https://i.stuff.co.nz/national/politics/110753822/is-a-life-...

[misiti3780]

i just meant it was a slap on the wrist because everyone signs a DPA and no one goes to jail

[kakwa_]

The French hierarchy of UBS got some prison time, but it's 6 to 18 suspended prison sentences, so no real jail time.

They were also fined 50000 to 300000 euros personally (they have to pay as private citizens, it's not part of the 3.7B euros fined to UBS).

Not completely full, but also not completely empty.

[HenryBemis]

50k and 300k are peanuts to these people, who have been pocketing millions each year in salaries and bonuses.

Jail time would be the only real punishment. They take very calculated and rewarding risks. If they don't get caught they walk away with many millions. If they get caught they walk away with many millions minus a few k.

Technically this is a "sure bet".

[missedthecue]

HSBC allegedly laundered (not revenue, not profit, they laundered) $880 million.

They were fined $1.9 billion.

Not "fined about half"

[thefounder]

They were caught with $880 millions. That doesn't mean they laundered only that.

[HenryBemis]

People and 'the News' most times don't read the details, which is logical since we never get the full reports on our hands. The scope of the audit/examination should document the limitations/boundaries of the examination. E.g. X, Y, and Z, countries, A, B, and C subsidiaries, for the period of dd/mm/yyyy to dd/mm/yyyy. And which transactions where checked? All deposits? From all business lines? E.g. bank deposits OR their investment brokers?

There are many ways to get money in a large Banking group like UBS, HSBC, and others. They have become Lernaea Hydras and for a good reason.

[onetimemanytime]

They were fined on what they were caught, not on what they did. They seem to keep repeating such schemes time and time again. Unless execs are jailed, this is cost of doing business. At some point an exec either said, "let's do it," or closed his eyes and ears.

[Loic]

This time the fine was calculated based on the recovery rates from the French people retrieving their money back to France (the law changed drastically in France and to avoid jail time, many people brought back money from Switzerland). This gave the government statistics to evaluate the effective fraud and thus calculate the corresponding fine.

Of course, over the years, we can be pretty sure that UBS made more money out of these schemes than the fine and they are most likely having such a scheme running right now which may be discovered in 10 years if we are lucky.

[nraynaud]

I like the idea: ”here is our best estimation, you can counter it by providing us with some documentation”

[tc313]

I think he meant half of $4.2 billion.

[misiti3780]

indeed i did thanks

[Shaanie]

Not sure if you need the "allegedly" when they admitted to the laundering.

[missedthecue]

The terms of the agreement was a fine without an admission of guilt. So in the interest of jurisprudence, allegedly is the correct word to use in this situation.

[misiti3780]

i meant roughly half of the 4.2

[sailingparrot]

This comments comes back on every single case like that no matter what the amount is, it's almost a cliché now.

Sure prison would be nice, but 4.8 billion dollar is very far from "a slap on the wrist", it it more than half of their yearly operating income worldwide.

[misiti3780]

It's not cliché, it's NOT ok that these corporations can commit huge crimes and no one goes to jail. I would say the fact that you seem OK with it is not OK.

Literally no one went to jail for the crimes of 2007-2008. No one went to jail for laundering money for the cartels, no one went to jail for Libor scandal, and no one went to jail here. Yet if you walk into McDonalds and rob it of the amount in the cash register, you could go to jail for many years

[chrisbennet]

It is not a deterrent though - they key doing it again and again. Right now employees aren’t punished (really) and the bank takes all the risk so why wouldn’t they do whatever they can get away with?

[repomies68]

I think many would be happy to go to jail and keeo the billions instead.

[cbg0]

You're very wrong. They can always make more money, but they can't make more time.

[usrusr]

That might be true for people who would otherwise be desperately poor, but these are not.

[diogenescynic]

Moneyland is another good book on this subject.

[gadders]

Those bigger teller windows were appalling, but this was more the actions for a rogue branch/country network than an officially sanctioned policy from senior management.

It does show a lack of controls in place, though.

[mcny]

Senior management must be responsible for the actions of "rogue branch" in an official capacity. When you slip and fall on black ice, you don't sue the janitor.