RBS and Whack-A-Mole: Chilton

The more than $600 million settlement between the Royal Bank of Scotland and several global regulators for manipulating benchmark interest rates is another glaring example of the financial sector run amok.

At any given time, regulators in the United States alone are investigating many thousands of individuals or entities for violations of the law.

(Read More: Banks Guilty of 'Brazen, Flagrant' Manipulation: CFTC)

Just when people think, and hope, the worst financial crimes are behind us, the hits keep on coming. It's a bit like the carnival amusement "Whack-A-Mole" where the little stuffed critters keep popping up and the patron must hammer them down as quickly as possible.

With so many financial "nogoodniks" out there, however, regulators around the globe need bigger and heavier hammers.

Royal Bank of Scotland
Getty Images
Royal Bank of Scotland

If it were just one or two bad apples, we might call it idiosyncratic. Sadly, it isn't.

We see violations across a wide range of the financial sector. Aside from RBS, UBS and Barclays trying to (and many times succeeding) to push global benchmark interest rates around, Bank of America and over a dozen of their fellow banking companies ripped off their own customers by overcharging on debit and ATM fees. MF Global misused customer funds.

(Read More: Barclays CEO: We Were Too Aggressive, Self-Serving)

In others cases, we've seen financial entities violating the law at record levels. Many times, like with RBS, it was flagrant. It's no wonder that customers often believe many of these firms and their leaders have proven unworthy of trust.

(Read More: RBS Tips UK Back Into Bonus Debate)

Will regulators whacking the moles with hundreds of millions in penalties and more prescriptive oversight efforts stop such things, and others, from occurring? Well, perhaps. We can hope.

But there's more to it than whacking these firms with penalties. A firm's character and culture go together and it is clear that a culture shift in the sector needs to take place at the highest levels.

(Read More: Rating Ratings Agencies: Yoshikami)

"The world financial system and those who are part of it are too important to us all. It is time for honest play. It is time for a serious and significant culture shift." -Bart Chilton, Commissioner, CFTC

Thankfully, we've witnessed the genesis of something positive in this regard.

Barclays' new CEO Antony Jenkins has said that Barclays' bankers had long gone after short-term profits at the expense of values and the organization's reputation. "We must never again be in a position of rewarding people for making the bank money in a way which is unethical or inconsistent with our values," he said. Now, that's the ticket! UBS's new head of investment banking said there was a culture that was "too arrogant, too self-convinced."

That's also the correct message, and it is a different message than we have seen out of the financial sector.

Will other such leaders emerge to push forward the needed financial sector culture shift? It is too early to tell. Until then, regulators need to keep whacking the moles.

The world financial system and those who are part of it are too important to us all. It is time for honest play. It is time for a serious and significant culture shift.

(Previous OpEd: Chilton: We Need the Volcker Rule Now)

Commissioner Bart Chilton of the U.S. Commodity Futures Trading Commission is the author of "Ponzimonium: How Scam Artists Are Ripping Off America."