Sean Corrigan is a very bright guy whose economic writings deserve more attention than they get.
But his assertion that U.S. regulators pursue wrongdoing by foreign banks, but not U.S. banks, is pure hogwash.
James Porter | Brand X Pictures | Getty Images
Bank Vault Door
Here’s what Corrigan, chief investment officer of Diapason Commodities Management, had to say on Squawk Box Europe Tuesday morning:
"Why is it always a British bank, or a Chinese bank or a German or a Swiss bank who are doing all these evil things around the world? Manipulating Libor and money laundering and financing terrorists and all these other... There is never American bank involved because they are all in the pocket of the American banking lobby ... all the sins, there are so many sins in the world which any commentator including within the American banking system will tell you sit at home but the American authorities never go after an American bank, they try and bully somebody abroad, this is ludicrous"
Try telling that to Goldman Sachs , which paid $550 million in fines a couple of years ago to settle charges connected to the sale of mortgage-related securities to a very shady German bank. Or to JPMorgan Chase, , which paid $150 million last year to settle similar charges. Oh, right, JPMorgan also coughed up $20 million in April to settle some charges that it lent too much money to Lehman Brothers.
If it seems like foreign banks get a lot of attention from U.S. regulators, that may be because foreign banks have such a large presence in the U.S. According to the most recent data from the Federal Reserve, foreign banks in the U.S. have $2.1 trillion in assets. That’s over 16 percent of the total commercial banking assets in the entire country.
There’s no doubt that the banking lobby is highly influential with regulators and lawmakers. But foreign banks are part of that lobby. Barclays , for example, spent over $2.8 million lobbying last year. Bank of America , America's second-largest domestic bank, spent only $3.2 million, according to OpenSecrets.org.
Capitol Hill may be on the payroll of banks, but a lot of that money is coming from foreign banks.
Follow John on Twitter. (Market and financial news, adventures in New York City, plus whatever is on his mind.)
