Friday, March 02, 2007

Crime and punishment

We hear a lot about 'benefit cheats'.. In our local paper there are regular court reports featuring some single parent who has been caught working whilst claiming benefit. I've had to try and manage on benefits before. It ain't easy. God alone knows how people with children cope. The ones we read about aren't usually engaged in high powered well paid employment - cleaning jobs feature a lot as do catering ones. Nevertheless they have made inaccurate claims and know that if when so doing they get caught, they will get punished.

My friend works for one of the world's biggest merchant banks. This article talks about the kind of salaries the brokers at banks like hers earn. Here's an extract from it:

Sulger-Buel says private bankers in London are among the best paid in the world. Top London bankers in the traditional relationship mould (private bankers hold wealthy clients' hands and gently help them choose the right products to manage their wealth), can earn up to £500,000.

But he also says the real money in London is to be made working for U.S. banks who operate a brokerage model (private bankers telephone wealthy clients and do their best to sell them equities/bonds/derivatives or any other form of security). Private client brokers are paid a proportion of the fees they earn. London brokers bringing in £3 million of fees easily could be paid £1 million.

What it doesn't mention are the annual bonus's. A broker who does not collect an annual bonus of at least £5 million according to my friend considers him/herself hard done by.

My friend has recently moved departments and now works for the internal fraud department. She started looking at expense claims and soon realised that two brokers - fairly middling level brokers - had systematically been fiddling their expense accounts over a prolonged period. She proved that they had been falsely claiming around £20,000 a month. Yes, I did mean to say 'a month'. Let us remind ourselves we are talking about employees at a very highly regarded and trusted financial institution.

Obviously there has been an investigation and my friend has been proved correct.

Going back to the beginning of this story, we as a society take a very dim view of cheats and consider they should be hung right out to dry. So of course we might expect to read about these two criminals as their high profile trial at the Old Bailey progresses. Except that actually we won't read a word about it because the very reputable bank has hushed it up and reached an agreement where the pair will repay the expenses they claimed 'in error.'* It seems it is only if you are a rather desperate single parent working night shifts in a food packing warehouse that you can expect to see your name all over the papers for cheating.

The bank has also demonstrated that they are a caring and compassionate employer by not actually sacking these two. After all we all make mistakes don't we? My friend suspects that there in fact is the rub and that if they started sacking everyone found to have fiddled their expenses they would soon have no brokers left.

* It's not that I am entirely unsympathetic to this pair. I am sure it is all too easy to miscalculate one's expenses by a mere £20,000 a month. Although my sympathy is somewhat tested when I consider that I would have to work from January to the end of October to earn what they have been fiddling in one month.


Yorkshire Pudding said...

Do I detect a little tinge of bitterness about those merchant wankers? You are obviously so right in what you say. How can we expect ordinary people at the breadline to be scrupulously honest when movers and shakers are lining their own pockets with ill-gotten gains? At least as you plough your furrow in Northamptonshire, you can sleep easy in your bed, safe in the knowledge that you are living an honest life - unless of course Reidski is there yanking at the duvet! Is he a merchant yanker?

JoeinVegas said...

How do we get to become bankers? I could use an expense acount like that, much less whatever the salary would be (plus bonuses)

Brom said...

I bought a T-shirt for $15 in a restaraunt once, and it got lumped in with the bill and I claimed it without thinking on my return. In light of this do you think I should say something?

J.J said...

YP, it is the greed of these people that makes me feel sick. What would they call 'enough' money I wonder?

Joe, yes, I think I could just about 'get by' on an expense account like that.

Brom, Just your prayers! (Seriously - think you have a way to go before you can equal the pair at my friends bank!)

David Duff said...

I read your post without that much interest, I must confess, because it's a story as old as Man and usually the teller of it risks sounding bitter and envious (which you *just* avoided). I then noticed there were four commenters but I wasn't going to bother because why read more of the 'same old, same old' but then I hesitated, and had a bet with myself: I bet a chocolate biscuit (strictly forbidden, normally) with my morning coffee that one of the commenters would be that great soppy 'Yorkshire Pudding'. I won! Thanks, 'YP'.