The latest figures collected by Oxfam indicate nearly a million persons have been ‘sanctioned’ (i.e. deprived of all benefits for a month for the first infringement, often trivial, for 3 months for the second, and 3 years for the third) in the last 15 months and that the numbers using foodbanks are now well over half a million. Yet bankers are still leading the life of Riley at the public expense without any being brought to book. Barclays under the so-called Jenkins ‘clean-up’ act has just stunned even the City by increasing bonuses by by 10% despite profits collapsing by 32%. All the Big 4 – HSBC, Barclays, RBS and Lloyds – have shown contempt for restraint by circumventing the new EU rule limiting bonuses to 200% of salary by paying a totally artificial ‘allowance’ far exceeding this limit. HSBC have thus paid their chief executive an ‘allowance’ worth £32,000 a week on top of his £1.6m salary. Barclays is the bank which took the lead in rigging Libor and HSBC was arraigned for money-laundering on behalf of drug cartels, terrorists and pariah states. Despite this background of big-time criminal activity amid soaraway boardroom greed, not one of the miscreants at the top of these organisations has been collared.
The only way to stop criminal fraud and misfeasance by the banks is not by fines, but by criminal prosecution of the top executives responsible. The huge size of the fines being regularly imposed – for example the mis-selling of PPI insurance (i.e. tricking people into buying insurance which it was known they did not need and in many cases couldn’t actually use) has led to penalties on the banks, particularly Lloyds, amounting now to £12bn – shows the colossal level of stealing from people by administrative deception. Yet no chief executive or top manager directly responsible has been prosecuted. The explosion of tax avoidance, on an eye-watering scale largely organised by the banks and Big 4 accountancy firms – Deloittes, KPMG, Ernst & Young, and PWC – has not led to any top executive being put on trial and sent to prison.
If the argument is that much of this activity, however immoral and anti-social, is technically legal, why hasn’t the government brought in legislation to close every loophole and to make manifestly artificial and contrived tax avoidance a criminal offence? The contrast with the US is telling. The US Department of Justice has charged 35 bankers and advisers (not nearly enough, but an advance on the UK’s none) for offences relating to offshore tax evasion, and the prospect of prosecution by the US authorities has been enough to make 43,000 taxpayers self-report and pay nearly $6bn in taxes and penalties. Instead of depriving people of all their income for 1 month or 3 months or 3 years, which isn’t going to get the deficit down more than infinitesimally, how about the UK tackling the really big money and the really big criminals?