Dec 26 (Reuters) – As well as too-big-to-fail it looks as if
we must think of our largest banks as too-big-to-punish as well.
After comments from top U.S. Justice Department officials in
the wake of the $1.5 billion settlement with UBS over
interest-rate manipulation, the bank’s counterparties,
employees, clients and competitors certainly will.
UBS was fined and a subsidiary pleaded guilty to one count
of felony wire fraud over its part in a wide-ranging effort to
doctor key benchmark interest rates such as the London Interbank
Offered Rate (Libor).
The combined fines and disgorgement UBS has made to
regulators in Britain, Switzerland and the U.S. were big – three
times larger than those paid by Barclays in a related scandal.
Comments made by U.S. Attorney General Eric Holder and Lanny
Brauer, head of the Justice Department’s criminal division,
however, indicate that UBS very likely got off more lightly than
you, me or the local credit union might have done had we
committed the same offenses.