Tag Archives: law

If you don’t identify the crimes or the criminals, you don’t have to support the victims.

There was an interesting article in the Guardian today on the subject of Lady Newlove’s report into the lack of support for victims of crime. http://www.theguardian.com/uk-news/2015/jan/27/victims-crime-let-down-criminal-justice-newlove I agree with her entirely – there is very little support. Equally interesting was the comments below the article.

For example, someone posted we are all more likely to be victims of financial crime than being mugged in the street. I would agree because PPI, IRHP, LIBOR rigging, asset theft (GRG) and various other fraudulent schemes, all have their victims – not that I am in anyway decrying the horrific consequences of violent crime.

However, there is a huge problem when it comes to financial crime. First and foremost, it is rarely classified as crime. It has various bogus titles and the most common is mis-selling. Also, financial crime is a political animal and as such, it seems to feel it is reasonable it should fall outside of the boundaries of common law. It shouldn’t do but it does. This is probably because any major case exposing the horrendous corruption in our financial system would have far reaching political and economic consequences. Not only would it risk serious ‘Brand protection’ to financial institutions, it would also damage UKPLC. Therefore even if you report serious and fully substantiated financial fraud to the police, you are unlikely to get an investigation – so you are unlikely to get a result.

Anyone challenging this view should consider why, when Banks are found guilty of money laundering for drug cartels, or of rigging LIBOR (which affects everyone), or of selling fraudulent products to consumers and SMEs, the answer is invariably a huge fine paid by the Bank shareholders? But no one goes to jail.

Occasionally and if you are incredibly persistent, the police will open an investigation into specific crimes by bankers or their associates in the financial system and, I can say from experience, that despite the initial euphoria victims may feel when this happens, what follows is a long drawn out process which gives little or no consideration to victims or to the consequences of those crimes. And while I adhere to the theory of “every man is innocent until proven guilty,” a justice system which takes years and years to bring cases to trial means that some victims, suffering badly from the effects of a crime, will have their lives on hold for an indefinite period. Some die before they ever see justice and that is a fact. “Justice delayed is justice denied.”(See below)

Take for example the case (which I won’t name for reasons of sub judice) where some 80 SMEs were first defrauded and then destroyed by employees and associates of a High Street bank. This was first exposed by the victims in 2007 but the police refused to investigate because the bank concerned assured them there was nothing to investigate. However, in 2010 and under the radar, a different police force did start an investigation. By the end of 2010 several people had been arrested but no one was charged until 2013. The trials for those people charged with assorted serious crimes were due to start in January this year but have now been put back to September and will finish in 2016 – if they happen at all. 2007 to 2016 is a long time to wait for justice. Three people have died while waiting.

The victims have lost their businesses, therefore their livelihoods and in many cases their family homes. They are all due compensation – but that won’t happen until after the trials as the management of the bank concerned are adamant no crime was committed (even although the Bank was the biggest loser of all) and the police have spent a fortune of public money on a witch hunt.

In the meantime there is little communication between the police and the victims except for the odd brief e-mail. The victims are dissuaded and even threatened not to attend any case management hearings – so they don’t know how the case is progressing (or not in this case) and if ‘victim support’ are aware of this crime, they haven’t acknowledged it. I know most of the victims – I don’t know any who have had any support.

The defendants on the other hand, are kept fully briefed by their legal teams (some of whom are paid for by legal aid), they continue to work or trade their businesses (which haven’t been destroyed) and some have requested and been given their passports back as and when they want to go on holiday abroad. Fair enough, they have not been found guilty as yet.

My point – most people in this Country are asking (quite reasonably) why bankers, who have already been found guilty of various crimes for which their shareholders have been penalised, have not been charged or gone to jail? I would say it is because the majority of the really serious crimes had to have happened with at least the knowledge and possibly the authorisation of those at the top of the Banks – not to mention key figures in associated ‘professional’ firms. But if Governments (via the justice system) start admitting our banks have been and are being run by criminals, it would destabilise our much loved financial system. So, even where a case does slip through the radar and bankers are charged with crimes, the main consideration seems to be how the authorities can limit contagion and, if possible, stop these trials actually going to Court. A valiant attempt was made to stop Operation Cotton and therefore other big financial fraud and VHCC (very high cost cases) from proceeding, via the legal aid débâcle. Fortunately it wasn’t successful.

And the victims? Well, better a few victims fall by the wayside than we tarnish the City of London. But actually it’s not a ‘few victims’ because we are all victims of financial crime and we are all paying the price (national austerity) while the charade goes on. And what a charade it is – after all that has happened and after banks brought world economies to their knees, top bankers demand and still get millions of pounds a year. And once a year they head off to Davos with the great and the good, to decide our economic future for the following 12 months. It’s not just illogical and unethical – it’s bonkers.

Great to see Lady Newlove has written a report and identified the lack of support for victims but, in the case of financial crime, which has reached epidemic proportions in the UK, the biggest hurdle to our justice system is a refusal to identify the criminals. Cost effective and sneaky but not democratic.

  • On the subject of “justice delayed is justice denied” and while I was looking for the origins of that quote, I randomly came across an extraordinary dark example of how this statement is sometimes abused by the very authorities we rely on for justice. The case is nothing to do with financial crime and the victim in the case is the accused. And this highlights yet again how important it is to democracy that justice is seen to be done and in a timely manner. I would say in too many cases, it isn’t. http://www.innocent.org.uk/cases/Karl%20Watson%20-%20Woffinden%20art.pdf

Mark Carney says #nooneisabovethelaw now we need to work on #whocanaffordthelaw?

On 24th September 30 people travelled from all over the Country to attend the first meeting of SMEalliance in the Old Council Chamber at the Law Society. It could have been double that number but, having asked our hosts, Rustem Guardian, for a room for 12 people, then 25 people, then 30 people, I felt it would have been rather rude to continually increase the numbers!  All the same we ended up with about 35 people. Rustem Guardian did us proud and we are enormously grateful to them for giving us such a fitting venue for our first meeting.

I say fitting because one of the key phrases that came out of the meeting was this:

“no one is above the law.”

Of course most people at the meeting were brought together because, as SME owners are very well aware, some people do seem to be above the law – which is, in part, the reason why so many SMEs are struggling and continue to be abused and especially (but by no means exclusively) by the financial sector. But the reality is  – and we need to remember it – in a working democracy, no one is above the law.

I raised this subject at the meeting because of a letter Paul and I received, dated 1st September 2014,  (1 day before SMEalliance was born) on behalf of Mark Carney, Governor of the Bank of England. We wrote to Mr Carney on 31st July 2014 and that is our first letter to him although we were in regular contact with Lord King from 2010 and he always replied, usually in person and with his private seal. Mervyn King (as he was in 2010) had asked to be kept fully informed of the progress of investigations into HBOS (ongoing) and I don’t make the point to infer we are buddies of Lord King’s,  I make it because by writing to him and getting replies, we were sure the BoE had critical information about malpractice in HBOS. So we were keen to make sure Mark Carney was similarly well informed. I can’t publish most of our letter or the reply for reasons of sub judice but I can publish this point we raised with the Governor:

Mr Carney, even as music publishers (there’s been little music publishing and lots of fraud investigation over the last 7 years), we understand the need to maintain international confidence in the City of London and our financial sector. But it would seem the attempts to indemnify bankers from crime in order to maintain that confidence, has resulted in the City becoming the ‘Wild West’ of the financial world. By not holding bankers to account individually when they break the law, we now have a situation whereby the banks feel their immunity to prosecution is a licence to further break the law. And they do so in the knowledge that, worst case scenario, their shareholders will pay huge fines while those bankers responsible for the good management and reputation of the banks, continue to get huge pay packets, bonuses and pension pots. Under such a scheme, where is the incentive for bankers to behave lawfully, morally and ethically?

The reply to this on behalf of the Governor was (I’ve redacted specific’s):

Your letter also notes a concern that regulators have not acted to penalise relevant individuals in relation to XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX and that bankers are somehow above the law and able to avoid prosecution. This is a view very much not shared by the Bank of England. As the Governors recent letter to Lord Blackwell made clear there is absolutely no doubt that bankers who are guilty of misconduct should face the regulatory and / or criminal consequences of their actions. No one is above the law.

I haven’t published that to annoy the Governor of the Bank of England by sharing private correspondence. On the contrary I’ve published it to make the point that in the “them v us” scenario many SME owners feel exists between businesses and the establishment,  we have a lot of shared views. And I may be very naive but I was actually delighted to read the headline in the Huff Post today:  Mark Carney Tears Into Bad Bankers For ‘Getting Away With It’

http://www.huffingtonpost.co.uk/2014/10/13/mark-carney-bankers-banking_n_5975494.html

I am not saying our letter to the Governor made an impact but, on the other hand, maybe he is aware of the bad conduct of banks towards SMEs – maybe we can get our message across to people like Mark Carney and maybe now if the time to resolve a “failure to communicate” situation that has existed for far too long. I really hope we can remedy that with SMEalliance. We can open a real dialogue with people who can help us get change – and this time, the message won’t be from people paid to represent us – it will be SMEs representing SMEs.

I feel hugely encouraged by the immediate response and support for SMEalliance – it really feels as if a fuse has been lit and an immediate network of like minded people have joined forces. We need to build and build our numbers so our voice gets louder. And then we can collectively make sure influential people like Mark Carney  or politicians know exactly how we feel, what our problems are and what changes we want to see – straight from the horses mouth. Starting maybe with the statement from the Governor’s office:

No one is above the law.

If even the Governor of the Bank of England is agreed on this principle. maybe we could start dealing with the one thing that hinders it:

But most people can’t afford the law.

That’s a huge problem but let’s not run before we can walk. If we can be sure the authorities will support  “no one is above the law” that would already go a long way to helping SMEs. So that when we report misconduct, fraud, misrepresentation, sharp practice or other issues that damage SMEs to the regulators, the police, MPs – we could do so with the confidence the law will protect us.

Last thing – you don’t have to have a problem to join SMEalliance. Aside from trying to raise important issues at a political level and have a huge voice, it is a huge opportunity to network, share information or idea’s and cross reference facts that will also alert others to potential pitfalls. And for those who do have a problem, it will also hopefully provide a support network.  I saw all of this go into action straight away when everyone at the meeting adjourned to the pub and it was evident the knowledge and experience people were willing to share was phenomenal.

Please visit our website http://www.smealliance.org and if like us you think SMEs, which are the absolute backbone of the economy, should have a better deal and a bigger voice, please join us. Our next meeting is 6th November at the Winford Manor Hotel in Bristol.