Bank fines will top more than $10 billion for 2012
From claims of laundering additional money For Iran and manipulating consumer interest rates, banks in the United States will end up paying about $10 billion for fines they accumulated during 2012. Banks such as USB has agreed previously to pay the authorities of the United States around $1 billion for manipulating their labour. This is the highest fine that a bank has ever paid in the history of the United States, not to mention the amount they also had to pay to European regulator.
Almost half of bank fines were connected to unethical mortgage practices or for helping victims of fraud or other issues. For example, around $1.4 billion was paid as a mortgage settlement to home lender in February. These funds were dedicated to individuals who had their homes foreclosed and improperly sold. Another $3 billion were paid to federal governments for funding public programs that were determined by state attorneys in the United States. $175 million were paid as a settlement in July to homeowners with subprime loans by the banks Wells Fargo. Victims of Bernard Madoff will be able to benefit from a settlement of $210 million by the Mellon Bank in New York. However, it is becoming apparent now that almost half these funds will end up in the hands of the Treasury fund in the United States and government coffers.
Banks that will have to pay fines include HSBC and Standard Chartered for laundering violations through transactions with some banned countries like Cuba or Iran. On the other hand, $335 million are going to be paid by the Deutsche Bank for selling risky mortgages to borrowers.
Most of these misdeeds and crimes were committed before 2010 and the penalties for crimes that took place this year have not been announced yet. There are several banks that are currently under investigation right now such as Morgan Chase for a fraud scandal that resulted in the bankruptcy of Peregrine Group. Business analysts believe that some of these fines are quite unfair and not strict enough, as most of these banks can afford to pay these fees. For example, HSBC earned more than $160 billion during 2012. Many experts believe that the fines should be stricter if the government is really trying to stop them from happening. As long as the banks are able to pay them, they will continue breaking the law without paying any attention to the government, their clients, or other businesses.