‘London financial scams on par with organized crime’
Stocks in Twitter jumped more than 8 per cent this Tuesday after an online publication claimed the company would be sold for $31 billion. The bogus article called 'Twitter Attracts Suitors' surfaced on what appeared to be Bloomberg’s website. In fact it was an imposter. That morning Twitter shares rose to almost $39 dollars each.
RT: How come fake news can sometimes have such an affect?
Tony Gosling: This is a brilliant one, isn’t it? For a few dollars, some scammers put up a website that put - within 20 minutes - $3 billion dollars on the value of Twitter before it was discovered. This is an example of the sort of thing that can happen with the deregulation in the financial industries, and lots of other reasons why for some people in the casino banking world, this suits them.
The trouble is that there seems to be a kind of impunity built in. When people do this it is very difficult, and suddenly precedence will say that they don’t get tracked down and prosecuted for this kind of thing. This is a kind of little game that the one per cent would like to play with the rest of us.
If you go back to January 2009, in London Times whistleblower Jerome Kerviel, a French guy, explained that they made lots of money in his firm by betting insurance shares would fall just before the 7/7 attacks and the 9/11 attacks. And it was one of the best trading days for them in history. So the problem is these scams are happening. Vast amounts of money, and of course if someone is betting - which of course they would have done with this Twitter scam - you can make millions, hundreds of millions of pounds in just a few minutes.
RT: So that is why they are doing this, obviously, to make money. It is not just for a laugh...
TG: I would be very, very surprised if someone hadn’t used the opportunity when there is such a massive spike in the shares to be buying at the lower price and selling as the price rises. You’ve got a real problem in the City of London with these sorts of regulation. My point on this is: The Securities and Exchange Commission and their equivalents in the City of London are simply not doing their job in tracking people down who are conducting these scams and making the money. We’ve got a whole list, haven’t we? Rowan Bosworth-Davies, former Scotland Yard Fraud Squad detective, pointed out a couple of years ago that the amount of scams going on now in the City, particularly, are equivalent, by the international definitions, of organized criminal activities, that is, organized crime.
We’ve had Libor [London Interbank Offered Rate] fixing, PPI, we’ve had foreign exchange, money laundering, interest rate swap scams. What happens is the banks themselves are paying a fine, but the actual directors and the senior managers involved still walk the streets with a big smile on their face having made hundreds of millions. Until Wall Street and the City of London start getting serious about prosecuting the one per cent that is getting away with this kind of crime, there is going to be no change. My prediction is that whoever has made money out of this, I’m sure there will be some people; they will have been long out of the casino before the door shut.
There is definitely a climate of impunity here. I don’t think that the Security and Exchange Commission and the City of London are really serious. In fact, some commentators have said that it is a unique selling point of the City nowadays that you can get away with any scam you want, criminality is accepted. I would encourage everyone to look at what Rowan Bosworth-Davies, former Scotland Yard Fraud Squad detective has been saying on this, because Parliament doesn’t want to hear, and we still haven’t had the basic things that need to be done to secure the City which is to separate the retail banking from the casinos.
The statements, views and opinions expressed in this column are solely those of the author and do not necessarily represent those of RT.