Tuesday, September 11, 2012

Milan prosecutor locks employees of foreign banks out of their offices

Talk about direct action!

The chief prosecutor of Milan was complaining about major UK and EU banks selling derivative products to Italian cities, with the cities taking on significant risks that were not properly explained. However, the banks simply ignored him, until he took direct action:
Alfredo "Lock the doors!" Robledo

Even though whistleblowers made the Financial Services Authority (FSA) aware that London-based banks, which it regulates, may have been mis-selling complicated derivatives to Italian local authorities, it refused to act.

"In terms of surveillance I saw no intervention by the FSA into any London-based banks," Milan's chief prosecutor Alfredo Robledo told Newsnight.

Mr Robledo did act, though, when he suspected mis-selling by London-based banks such as UBS, Deutsche Bank and JP Morgan.

They simply ignored Mr Robledo until, that is, he locked their employees out of their Italian offices in 2009.

However, they settled with Milan this year, tore up the offending Swap contracts and paid the city almost 500m euros.

"The banks threaten to take their capital out of countries if regulation comes in. But we need regulation as these banks are plundering society," Mr Robledo said.

The London-based banks who were accused of mis-selling Swaps to Italian local authorities now face numerous civil and criminal proceedings by multiple Italian cities.

If he was in the USA, that chief prosecutor would be a slam dunk if he ran for Mayor or even Governor of the state.

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