European Bank's Response To Margin Calls: Just Break The Law And Make It Up--Banks To Blame For Europe's Debt Woes

Tyler Durden ~ ZeroHedge

While it will hardly come as a surprise to many, the bitter truth that bankers are to blame for much of the inexorable plunge that Europe faces (and for that matter the rest of the Western/Keynesian world) has once again been dragged front-and-center. In an interview on Australian TV, a former Unicredit senior banker, Jonathan Sugarman, discusses (along with no less than everyone’s favorite roulette player – Nick Leeson) how rules are broken (not bent) and the ‘rotten culture encourages excessive risk taking’. The former head of risk management resigned after being forced to break the law – specifically by dramatically under-reserving (or over-leveraging). These figures were not reported which means that, in Mr. Sugarman’s words, he was “100 per cent certain that Unicredit broke the law while he was working there”. The rot goes deeper though, as the interview describes, when he turned himself over to the regulators (blood-dripping knife in hand), they simply said “Fine, just don’t do it again“. Reflecting on the twenty years since Barings, Leeson remarks: “The weakness is in those risk management compliance and control areas. Always has been, still is and probably always will be”. Comforting?

The full interview and transcript from ABC News Foreign Correspondent Emma Alberici.

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