Armstrong Economics Blog/Corruption Re-Posted Oct 21, 2020 by Martin Armstrong
QUESTION: Why are bankers never prosecuted? The New York courts are not trustworthy. Can you explain why this is allowed to go one all the time?
ANSWER: It is very simple and the shareholders are the ones who are being defrauded. The banks can routinely engage in fraud all they want. The individuals are NEVER prosecuted because the government knows they will not get huge fines from an individual. The bank is fined and pays vast amounts of money, but the bankers themselves are never prosecuted. It is raw corruption. The very same bankers go on to commit the very next crime. They get bonuses for the money they make, and if caught, they keep the bonus and the shareholders pay the fine.
I personally would NEVER recommend a bank stock for that reason. The bonuses were paid out even during the 2007-2009 crisis. The S&P 500 Financial Index just retest the 2007 high compared to the rest of the market. The corruption between the courts, the government, and the banks is starting to wear very thin.