presidential campaign, as well as New York State investigations into the activities of the Trump organization, will yield connections to laundered Russian cash through numerous major banks. It is also conceivable that the ongoing investigations by Special Counsel Robert Mueller of Russian involvement in the 2016 U.S. The schemes involved over $225 billion of cash going through the bank over several years and its top executives claimed that they never even noticed any of that activity. It was precisely such incentives which played a role, for example, in the vast money-laundering schemes used by Russians through the tiny Estonian branch of Danske Bank. Even so, the core culture of banks –providing the greatest bonuses to bankers who secure the largest short-term profits –shows little indication of changing. The largest banks have paid over $340 billion in fines in the decade since the world’s financial crisis and the total keeps rising. Three inconvenient factsįact: On both sides of the Atlantic, we find major banks riddled with malfeasance.įact: The same mega-banks are repeatedly caught in the middle of scandals.įact: Banks just pay fines, while their most senior executives are never personally prosecuted, let alone jailed. This includes a potential new money-laundering scandal after 170 police officers and tax investigators recently raided its Frankfurt headquarters. Meanwhile, in Europe, Deutsche Bank’s stock price has fallen sharply as its troubles multiply. The stock has been under pressure for many reasons this year, including the U.S. News of the Malaysian charges pushed the bank’s stock down to its low level of 2018 at $166.53, which compares to the year’s high of $275.33. Justice Department investigation for its role in the 1MDB scandal. Thomas said that Malaysia will seek a fine in excess of $2.7 billion, plus the $600 million commission that the bank charged for raising the cash for Malaysia. example.Īttorney General Tommy Thomas said criminal charges under the country’s securities laws are being brought against Goldman Sachs in connection with $6.5 billion raised for Malaysia’s 1MDB development fund. Now, Malaysia appears to be following the U.S. authorities have leveled far greater fines. Until now, European authorities have negotiated generally modest fines with banks caught in all manner of malfeasance, while the U.S. Never before have the authorities of an emerging market country filed criminal charges against one of the world’s leading banks and threatened fines that could run into several billion dollars.įor too long, the world’s major monetary authorities have been complacent about the fraud and corruption at banks, despite the mounting threats that the continuation of such behavior pose to global financial stability. Malaysia’s justice authorities have filed serious charges against Goldman Sachs that may launch a new era in international efforts to punish major global banks for alleged fraud and corruption.
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