Tak­ing a hard line on crime as storm clouds gather

Yorkshire Post - Business - - BUSINESS / NEWS - Greg Wright DEPUTY BUSI­NESS ED­I­TOR @greg­wrightYP

ONE of the joys of speech writ­ing is that it gives you the chance to step away from the sound and fury of the daily grind.

It’s nice to breathe the cool, clear air of con­tem­pla­tive thought. Yes­ter­day, I was one of the speak­ers at the Thriv­ing Minds con­fer­ence in Leeds, which high­lighted the im­por­tance of look­ing af­ter your work­ers’ men­tal health.

When I walked to the lectern, I aimed to con­vey two points. Firstly, that the fi­nan­cial crash had forced many peo­ple to re-eval­u­ate how they con­ducted busi­ness.

I hoped the ter­ri­ble con­se­quences of the fi­nan­cial cri­sis of 2008 had en­cour­aged more man­agers to place the em­pha­sis on dis­play­ing em­pa­thy and com­pas­sion to­wards their staff. Greed and stu­pid­ity had trig­gered chaos. Per­haps it’s time to con­duct busi­ness with a hu­man face?

Se­condly, I also ar­gued that a new gen­er­a­tion of work­ers was emerg­ing, whose lives had been built around the cul­ture of dis­clo­sure, thanks to the rapid growth of so­cial me­dia. They were more likely to openly seek help for men­tal health prob­lems. A topic is un­likely to re­main taboo if ev­ery­one is talk­ing about it.

Af­ter I re­turned to the news­room, I won­dered if I had been too op­ti­mistic, at least on the first point. Be­fore 2008, many peo­ple re­ally did buy in to the myth that we had fi­nally ended the days of boom and bust. The crash shat­tered con­fi­dence in the fi­nan­cial ser­vices sec­tor.

But have the lessons re­ally been learned? And could we be sleep­walk­ing to­wards an­other disas­ter? Th­ese ques­tions are not as out­landish as they might sound.

For one thing, those re­spon­si­ble for the crash have never been pun­ished. The Thirsk and Mal­ton MP, Kevin Hollinrake, has called for the pros­e­cu­tion of bankers who got away with caus­ing the fi­nan­cial cri­sis de­spite “clear ev­i­dence” of wrong­do­ing.

Mr Hollinrake, who is the co-chair­man of the All Party Par­lia­men­tary Group on Fair Busi­ness Bank­ing, be­lieves eco­nomic crime agen­cies must get the fund­ing they need to bring crim­i­nals to jus­tice.

Mr Hollinrake is con­cerned that the Se­ri­ous Fraud Of­fice, the Na­tional Crime Agency Eco­nomic Crime

Com­mand and the newly es­tab­lished Na­tional

Eco­nomic Crime

Cen­tre don’t have the re­sources to pro­tect the pub­lic. The num­ber of pros­e­cu­tions re­mains piti­fully small.

At the same time, storm clouds are gath­er­ing on the hori­zon. The In­ter­na­tional Mone­tary Fund (IMF) has warned that risks to the global fi­nan­cial sys­tem have risen over the past six months .

The IMF fears th­ese risks could in­crease sharply if pres­sures in emerg­ing mar­kets es­ca­late or global trade re­la­tions de­te­ri­o­rate.

The IMF also noted that, while the bank­ing sys­tem has been shored up by reg­u­la­tors in the decade since the global fi­nan­cial cri­sis, easy fi­nan­cial con­di­tions are con­tribut­ing to a build up of vul­ner­a­bil­i­ties such as high debt lev­els and “stretched” as­set val­u­a­tions. New bank res­o­lu­tion regimes meant to avoid fu­ture bailouts are largely untested, the IMF warned.

“Over­all, mar­ket par­tic­i­pants ap­pear com­pla­cent about the risk of a sharp tight­en­ing in fi­nan­cial con­di­tions,’’ the IMF said.

IMF cap­i­tal mar­kets di­rec­tor Tobias Adrian said po­ten­tial shocks to the sys­tem could come in many forms, such as higher than ex­pected in­fla­tion that trig­gers a sharp jump in in­ter­est rates or a dis­or­derly Brexit.

In the re­port, the IMF said eco­nomic growth ap­pears to have peaked in some ma­jor economies while the gap be­tween ad­vanced coun­tries and emerg­ing mar­kets was widen­ing.

It also urged global reg­u­la­tors to keep in place mea­sures taken since the fi­nan­cial cri­sis. It be­lieves reg­u­la­tors should heighten su­per­vi­sion of mar­ket liq­uid­ity and raise the amount of cap­i­tal banks have to set aside to cush­ion any down­turn.

Now is not the time to let er­rant bankers off the hook. If there is no de­ter­rent, how can our fi­nan­cial sys­tem be se­cure?

While Brexit re­mains a na­tional ob­ses­sion, a new cri­sis is brew­ing un­der our noses. Who will stop bank­ing mis­con­duct on an in­dus­trial scale from bring­ing the econ­omy to its knees? Hu­man na­ture is flawed and his­tory has a sad habit of re­peat­ing it­self.

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