Currency Fixing Scandal Illustrates Wall Street Culture

[This is the opinion of Josh Snodgrass.]

It hasn’t gotten much popular attention but dozens of global megabanks are being investigated for manipulating currency “fixes”. This is similar to the LIBOR scandal which also probably made your eyes glaze over but it is worth paying attention because it is a perfect illustration of Wall Street “ethics” and also how the government punishes law-breaking, but not enough to end it.

Dozens of banks, hundreds of bankers are implicated in the currency and LIBOR scandals. For many years and across many banks, traders set prices to increase the profits they made for the banks and therefore the bonuses they would receive. Several things are worth noting:

• Prices were set to profit the traders, not the banks illustrating that:

• Traders don’t care about the banks they work for, just their own bonuses
• Traders don’t care about the law if they think that can get away with it
• Banks are unable to supervise their own employees

• It was very widespread:

• This is the culture of Wall Street. Not an isolated “rogue”.

• Fines are being paid, there is even talk of prosecution, but senior bank execs are not paying a price.

• It’s ok for this to go on. CEOs can still “earn” tens of millions.

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