There are times you have to remind people of history, because they continue to argue out of both sides of their mouths depending on which position they care to defend on a given day.
New York’s top financial regulator,Benjamin Lawsky, wiped more than $9 billion, or about 16 percent, off the market value of the U.K.’s Standard CharteredPlc this week. We have some questions.
I'm sure Bloomber's editorial desk does.... (like whether they should kneel on the left knee or the right one before unzipping the banksters' pants.)
First, what makes the money-laundering case so differentfrom those of Barclays Plc, Lloyds Banking Group Plc, ABN Amro Group NV and ING Bank NV, each of which paid hundreds of millions of dollars to settle the same accusations that Standard Chartered now faces?
Nothing. The other cases should have resulted in criminal prosecutions and charter revocations. But the decision to start busting people for conduct always begins with one alleged criminal, does it not? When the people have finally had enough of people blowing up apartments cooking meth, someone is the first to get hammered instead of hand-slapped for cooking up a batch on the stove.
This is called "progress."
U.K. Treasury officials separately asked their U.S. counterparts to clarify just what rules were allegedly broken, clearly implying that New York was overreaching. Standard Chartered was apparently cooperating in the federal investigation by providing e-mails and other documents, presumably with a view to settling.
So what? The Federal Government can do what it wants And the States can do what they want. It's called the 10th Amendment, if you haven't noticed.
If Standard Chartered doesn't like NY Law and regulation, it can always relocate its US offices to a tent pitched outside the Capitol Building. I suggest the lawn facing The Federal Reserve in order to cut down the amount of walking that the bank's employees have to engage in to shuttle between the various people that they want to "convince."
Finally, why is a New York state regulator taking the lead in a case that involves a breach of federal regulations that were imposed as a matter of foreign policy and are normally policed by the Treasury? Lawsky has a duty to ensure that banking licenses are properly granted in New York. That gives him significant power. But this case surely seems a federal one.
Oh really?
May I ask where Bloomberg's opinion was on jurisdictional shopping when banks relocated their credit-card operations to South Dakota specifically to evade usury regulations? Let me guess -- it was all just fine to evade state regulations in NY (and elsewhere) on maximum interest rates by shopping jurisdictions between the states, even to the point of pretty-much explicitly bribing a state legislature with the promise of call-center jobs to get favorable legal treatment.
Right?
So if this is perfectly ok when it works in the banks' favor, it is when it does not.
QED.
