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Published on Jul 10, 2012
So yesterday, we saw Paul Tucker, the deputy Governor of the Bank of England, defending his position, in the LIBOR rigging scandal, denying any awareness on his part, that the LIBOR was being manipulated. He described the LIBOR rates, as a "cesspit", during his hearing in front of the Treasury Select Committee, and also denied, having been put under pressure, by the UK government, to encourage LIBOR manipulations. The FED, however, seems to have known of the distorted LIBOR rates, since the summer of 2007. An inquiry had been launched as early as 2008, but nothing had been done. Begs the question, of why neither the UK nor the US, regulatory authorities acted to stop the manipulations. My guess, is that everyone was under political pressure at that time, to keep pretending, that everything is good in the hood, for as long as possible, in hope that the looming financial crisis, would go away by itself...but here we are. Well at least Bob Diamond, supposedly, rejected his 30 million dollar bonus... and will only take his 2 million pound yearly salary...very gracious.
And another one bites the dust. Brokerage PFGBest, which is mainly dealing with retail commodities and foreign exchange trading, is under fraud investigation, and its accounts were frozen yesterday, by the National Futures Association. It seems the Brokerage firm was lying about its deposit, maintaining that it had $225 million dollars, when in reality it only has $5 million. Russel Wasendorf, the founder of the firm, is sadly hospitalized after an attempted suicide, may have been involved in falsifying bank records. This is yet another blow to the derivatives industry, that is still trying to recover from the MF Global collapse. Where are the regulators looking? Aren't you supposed to be the parent to these banker children and stop them, before they try to kill themselves?! I mean common, I feel bad for the guy.
But not all is bad in the world. An important development in justice enforcement by the International Criminal Court, has taken place, as Congolese warlord, Thomas Lubanga, is sentenced to 14 years in jails, for using child soldiers in his rebel army in 2002 and 2003. The wide spread DR Congo war, has claimed as many as 5 million lives, and Lubanga was directly involved in the local war of the Ituri region, which left as many as 60,000 people dead. 14 years in jails, seems to be a mild sentence, for someone who used children as young as 10 years old, as body guards and soldiers. Where in the world do they get all these weapons from?