It is astonishing that every week we see action being taken in various part of the world against the financial sector, without any noticeable reaction of public opinion.

It is astonishing because at the same time we are experiencing a very serious crisis, with high unemployment, precarious jobs and an unprecedented growth of inequality, which can all be attributed, largely, to speculative finance.

Roberto Savio

This all began in 2008 with the mortgage crisis and the bursting of the derivatives bubble in the United States, followed by the bursting of the sovereign bonds bubble in Europe.

It is calculated that we will need to wait until at least 2020 to be able to go back to the levels of 2008 – so we are talking of a lost decade.

To bail out the banks, the world has collectively spent around 4 trillion dollars of taxpayers’ money. Just to make the point, Spain has dedicated more than its annual budget on education and health to bail out the banking sector … and the saga continues.

Last week, five major banks agreed to pay 5.6 billion to the U.S. authorities because of their manipulations in the currency market. The banks are household names: the American JPMorgan Chase and Citigroup, the British Barclays and the Royal Bank of Scotland, and the Swiss UBS.“To bail out the banks, the world has collectively spent around 4 trillion dollars of taxpayers’ money”

In the case of UBS, the U.S. Department of Justice took the unusual step of tearing up a non-prosecution agreement it had reached earlier, saying that it had taken that step because of the bank’s repeated offences. “UBS has a ‘rap sheet’ that cannot be ignored,” said Assistant U.S. Attorney General Leslie Caldwell.

This is a significant departure from the Justice Department’s guidelines issued in 2008, according to which collateral consequences have to be taken into account when indicting financial institutions.

“The collateral consequences consideration is designed to address the risk that a particular criminal charge might inflict disproportionate harm to shareholders, pension holders and employees who are not even alleged to be culpable or to have profited potentially from wrongdoing,” said Mark Filip, the Justice Department official who wrote the 2008 memo.

Referring to the case of accounting giant Arthur Andersen, which certified as valid the accounts of the Enron energy company that went into bankruptcy for faking its budget, Filip said that “Arthur Andersen was ultimately never convicted of anything, but the mere act of indicting it destroyed one of the cornerstones of the Midwest’s economy.”

This was in fact a declaration of impunity, which did not escape the managers of the financial system, under the telling title of “Too Big to Fail”.

Two weeks ago, a judge from the Federal District Court of Manhattan, Denise L. Cote, condemned two major banks – the Japanese Nomura Holdings and the British Royal Bank of Scotland – for misleading two mortgage public institutions, Fannie Mae [Federal National Mortgage Association] and Freddie Mac [Federal Home Loan Mortgage Corporation], by selling them mortgage bonds which contained countless errors and misrepresentations.

“The magnitude of falsity, conservatively measured, is enormous,” she wrote in her scathing decision.

Nomura Holdings and the Royal Bank of Scotland were just two of 18 banks that had been accused of manipulating the housing market. The other 16 settled out of court to pay nearly 18 billion dollars in penalties and avoid having their misdeeds aired in public.

Nomura Holdings and Royal Bank of Scotland refused any settlement and instead went to court against the U.S. government, arguing that it was the housing crash which caused their mortgage bonds to collapse. Judge Cote, however, wrote that it was precisely the banks’ criminal behaviour which had exacerbated the collapse in the mortgage market.

It is worth noting that, until now, the cumulative fines inflicted by the U.S. government on just five major banks since 2008 amount to a quarter of a trillion dollars. No one has yet gone to jail – fines have been paid and the question closed.

Now the question: is all this due to the misconduct of a few greedy managers or is it due to the new “ethics” of the financial sector?

By the way, let us not forget that it was revealed recently that 25 hedge fund managers took close to 14 billion dollars only last year and that the highest paid manager took for himself the unthinkable amount of 1.3 billion dollars, equal to the combined average salaries of 200,000 U.S. professionals.

Well, just a week ago, the respected University of Notre Dame was reported as having published a startling report, based on a survey of more than 1,200 hedge fund professionals, investment bankers, traders, portfolio managers from the United States and the United Kingdom, in which about one-third of those earning more than 500,000 dollars a year said that they “have witnessed or have first-hand knowledge of wrongdoing in their workplace.”

The report went on to say that “nearly one in five respondents feel financial services professionals must sometimes engage in unethical or illegal activity to be successful in the current financial environment” and in any case,  nearly half of the high income professionals consider authorities to be ”ineffective in detecting, investigating and prosecuting securities violations.”

A quarter of respondents stated that if they saw that there was no chance of being arrested for insider trading to earn a guaranteed 10 million dollars, they would do so.

And nearly one-third “believe compensation structures or bonus plans in place at their companies could incentivise employees to compromise ethics or violate the law.”  It should also be noted that the majority were worried their employer “would likely to retaliate if they reported wrongdoing in the workplace.” So, the bonus that goes to those in the financial sector every year practically amounts to a bribe for silence on misconduct.

At the same time, we have learned that in Guatemala the Governor of the Central Bank has been arrested for embezzling 10 million dollars. Of course, everything is a question of scale…but in sociology there is a mechanism called “demonstration effect”.

The example of Wall Street and the City will increasingly seep down once a new “ethic” is in place. It will propagate if it is not stopped … and this is not happening.

A final note. In the same week (how many things have happened in such a short space of time), the Federal Trade Commission of Columbia accused four respected cancer charities of misusing donations worth millions of dollars.

One of them, the Cancer Fund of America, declared that it spent 100 percent of proceeds on hospice care, transporting patients to chemotherapy sessions and buying medication for children. The Federal Trade Commission found in fact that less than three percent of donations was spent on cancer patients.

The “new ethic” is in reality a cancer, and it is metastasising rapidly. (END/COLUMNIST SERVICE)

Edited by Phil Harris   

The views expressed in this article are those of the author and do not necessarily represent the views of, and should not be attributed to, IPS – Inter Press Service. 

By Robert F. Kennedy Jr
WHITE PLAINS, New York, Jan 6 2015 (IPS)

I grew up in Hickory Hill, my family’s home in Virginia which was often filled with veterans of the failed Bay of Pigs invasion. 

My father Robert F. Kennedy, who admired the courage of these veterans and felt overwhelming guilt for having put the Cubans in harm’s way during the ill-planned invasion,  took personal responsibility for finding each of them jobs and homes, organising integration of many of them into the U.S. Armed Forces.

Robert F Kennedy Jr

But as the process of détente unfolded, suspicion and anger were so widespread that even those Cubans who loved my father and were always present at my home when I was a boy, stopped visiting Hickory Hill.

To the CIA, détente was perfidious sedition.  Adlai Stevenson [at the time U.S. ambassador to the United Nations] had warned President John F. Kennedy that “unfortunately the CIA is still in charge of Cuba.”  The agency, he said, would never allow normalisation of relations.

JFK was involved in secret negotiations with Fidel Castro designed to outflank Foggy Bottom [Washington] and the agents at Langley [CIA], but the CIA knew of JFK’s back-channel contacts with Castro and endeavoured to sabotage the peace efforts with cloak and dagger mischief.

In April 1963, CIA officials secretly sprinkled deadly poison in a wetsuit intended as a gift for Castro from JFK’s emissaries James Donovan and John Nolan, hoping to murder Castro, blame JFK for the murder, and thoroughly discredit him and his peace efforts.

The agency also delivered a poison pen to hit man Rolendo Cubelo in Paris, with instructions that he use it to murder Fidel. William Attwood [a former journalist and U.S. diplomat attached to the United Nations asked by JFK to open up secret negotiations with Castro] later said that the CIA’s attitude was: “To hell with the President it was pledged to serve.”“There is no doubt in my mind. If there had been no assassination, we probably would have moved into negotiations leading to a normalisation of relations with Cuba” – William Attwood, U.S. diplomat asked by John F. Kennedy to open secret negotiations with Castro, speaking of JFK’s assassination

Many exile leaders openly expressed their disgust with the White House “treachery”, accusing JFK of engaging in “co-existence” with Fidel Castro.  Some Cubans remained loyal to my father, but a small number of hard, bitter homicidal Castro haters now directed their fury toward JFK and there is credible evidence that these men and their CIA handlers may have been involved in plots to assassinate him.

On April 18, 1963, Don Jose Miro Cardona, Chair of the Cuban Revolutionary Council, resigned in a fusillade of furious denouncements aimed at JFK and my father, saying that “the struggle for Cuba is in the process of being sabotaged by the U.S. government.”

Cardona promised: “There is only one route left to follow and we will follow it:  violence.”

Hundreds of Cuban exiles in Miami neighbourhoods expressed their discontent with the White House by hanging black crepe from their homes.  In November 1963, Cuban exiles passed around a pamphlet extolling JFK’s assassination. “Only one development,” the broadside declared, would lead to Castro’s demise and the return to their beloved country – “If an inspired act of God should place in the White House within weeks in the hands of a Texan known to be a friend of all Latin America.”

Santo Trafficante, the Mafia boss and Havana casino czar who had worked closely with the CIA in various anti-Castro assassination plots, told his Cuban associates that JFK was to be hit.

On the day JFK was shot, Castro was meeting with French journalist Jean Daniel, editor of the socialist newspaper Le Nouvel Observateur and one of JFK’s secret channels to Castro, at his summer presidential palace in Varadero Beach.  At 1.00 p.m. they received a phone call with news that Jack had been shot.  “Voila, there is the end to your mission of peace,” Castro told Daniel.

After JFK’s death, Castro persistently pushed Lisa Howard [ABC newswoman who served as an informal emissary between JFK and Fidel], Adlai Stevenson and William Attwood and others to ask Kennedy’s successor Lyndon Johnson to resume the dialogue.  Johnson ignored the requests and Castro eventually gave up.

Immediately following JFK’s assassination, many clues appeared – later discredited – suggesting that Castro may have orchestrated President Kennedy’s assassination.

Johnson and others in his administration were aware of these whispers and apparently accepted their implication. Johnson decided not to pursue rapprochement with Castro after being told by his intelligence apparatus, including Federal Bureau of Investigation (FBI) boss J. Edgar Hoover, that Lee Harvey Oswald may have been an agent of the Cuban government.  This despite Oswald’s well-established anti-Castro bona fides.

After JFK’s death, my father continued to press Lyndon Johnson’s State Department to analyse “whether it is possible for the United States to live with Castro.”

“The present travel restrictions are inconsistent with traditional American liberties,” my father, then-U.S. Attorney General, argued in a behind-the-scenes debate over the ban on U.S. citizens traveling to Cuba.

In December 1963, the Justice Department was preparing to prosecute four members of the Student Committee for Travel to Cuba who had led a group of 59 college-age Americans on a trip to Havana. My father opposed those prosecutions, as well as the travel ban itself.

In a December 12, 1963 confidential memorandum to then Secretary of State Dean Rusk, he wrote that he favoured “withdraw[ing] the existing regulation prohibiting trips by U.S. citizens to Cuba.”

My father argued that restricting Americans’ right to travel went against the freedoms that he had sworn to protect as Attorney General. Lifting the ban, he argued, would be “more consistent with our views as a free society and would contrast with such things as the Berlin Wall and Communist controls on such travel.”

Secretary of State Dean Rusk thereafter excluded my father from foreign affairs discussions.  He was still Johnston’s Attorney General but the roaming portfolio that had previously empowered him to steer U.S. foreign policy during the Kennedy administration years was now revoked.

The CIA would continue its efforts to try to assassinate Castro during the first two years of the LBJ administration.  Johnson never knew it.  Castro provided Senator George McGovern with evidence of at least ten assassination plots during this period.

In 1978, Castro told visiting Congressmen, “I can tell you that in the period in which Kennedy’s assassination took place, Kennedy was changing his policy toward Cuba.  To a certain extent we were honoured in having such a rival.  He was an outstanding man.”

William Attwood later said: “There is no doubt in my mind. If there had been no assassination, we probably would have moved into negotiations leading to a normalisation of relations with Cuba.”

When I first met Castro in 1999, he acknowledged the recklessness of his brash gambit of inviting Soviet nuclear arms into Cuba.  “It was a mistake to risk such grave dangers for the world.”  At the time, I was lobbying the Cuban leader against Havana’s plans to open a Chernobyl-style nuclear plant in Juragua.

During another meeting with the Cuban leader in August 2014, Fidel expressed his admiration for John Kennedy’s leadership and observed that a nuclear exchange at the time of the Cuban missile crisis could have obliterated all of civilisation.

Today, five decades later and two decades after the Soviets left Cuba, we are finally ending a misguided policy that at times has done little to further America’s international leadership or its foreign policy interests. (END/IPS COLUMNIST SERVICE)

(Edited by Phil Harris)

The views expressed in this article are those of the author and do not necessarily represent the views of, and should not be attributed to, IPS – Inter Press Service. 

*             Robert F. Kennedy Jr serves as Senior Attorney for the National Resources Defense Council, Chief Prosecuting Attorney for the Hudson Riverkeeper and President of Waterkeeper Alliance. He is also a Clinical Professor and Supervising Attorney at Pace University School of Law’s Environmental Litigation Clinic and co-host of Ring of Fire on Air America Radio. Earlier in his career, he served as Assistant Attorney General in New York City.

Excerpt: