“Can misbehaving bankers be reined in? In the wake of seemingly endless banking scandals, Mark Carney, governor of the Bank of England, promised on June 10th to do just that. “The age of irresponsibility is over,” Mr Carney declared. The bank, the Financial Conduct Authority (a fellow regulator) and the Treasury hope to adopt and export a new model for regulating scandal-ridden fixed income, currency and commodities (“FICC”) markets. Recent wrongdoing in this area includes the rigging of LIBOR, a benchmark interest rate, and the manipulation of currency markets. Yet authorities have struggled to bring the individuals responsible to account.
Banks have not gone unpunished for their sins: it seems that at every recent results season, they have had to set aside ever greater provisions for fines, often sapping their already feeble profits. Between 2009 and 2014 the world’s banks incurred £160 billion ($245 billion) in such costs and set aside a further £46 billion to cover future payouts, says CCP, a research group.”
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