The Libor scandal seems to be waking people up to manipulation and fraud by the big banks.
There are many other types of fraud they’ve engaged in as well …
Here is a partial list:
- Committing massive and pervasive fraud both when they initiated mortgage loans and when they foreclosed on them (and see this)
- Cheating homeowners – especially veterans – from laws meant to protect people from unfair foreclosure
- Pushing investments which they knew were terrible, and then betting against the same investments to make money for themselves. See this, this, this and this
- Shaving money off of virtually every pension transaction they handled over the course of decades, stealing collectively billions of dollars from pensions worldwide. Details here,here, here, here, here, here, here,here, here, here, here andhere
- Laundering money for drug cartels. See this, this and this (indeed, drug dealers kept the banking system afloat during the depths of the 2008 financial crisis)
But at least the big banks do good things for society, like loaning money to Main Street, right?
- The big banks no longer do very much traditional banking. Most of their business is from financial speculation. For example, less than 10% of Bank of America’s assets come from traditional banking deposits.Instead, they are mainly engaged in financial speculation and derivatives. (and see this)
- The big banks have slashed lending since they were bailed out by taxpayers … while smaller banks have increased lending. See this,this and this
- A huge portion of the banks’ profits comes from taxpayer bailouts. For example, 77% of JP Morgan’s net income comes from taxpayer subsidies