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THERESA MAY has made some noises about the hurt caused by the banks, but her government is still too close to the City to do anything about it.
They are so close to the banks that one of May’s ministers — one of the ministers in charge of Brexit, no less — came into government as a servant of a Spanish banker. He has left government to serve the same banker, almost without comment.
In her “social justice” speech at the recent Tory conference, May agonised about how “the effects of the financial crisis — nearly a decade of low growth, stagnating wages and pay restraint — linger.”
But May shows no sign of trying to change City behaviour, while a revolving door between her government and the banks spins gently.
In July 2016, George Bridges was a government minister in the Department for Exiting the European Union (DExEU). Before that he had been a minister in David Cameron’s cabinet office.
Bridges took up a new job in October as senior adviser to Ana Patricia Botin. She is the executive chairman of the Santander Group, the Spanish banking giant whose financial empire includes all the old Abbey National branches in Britain.
Santander is a huge banking transnational with a financial interest in every kind of government regulation and activity. Having an ex-British minister on the payroll is obviously useful to it.
Bridges’s bank job also sends another message to our current ministers to think of the banks and of their post-government careers when making policy.
His previous job involved “guiding strategic policy making” over Brexit. Santander obviously wants a Brexit that is designed to please the banks. It was already lobbying Bridges when he was a minister.
The Advisory Committee on Business Appointments (Acoba) is the “watchdog” that ineffectually regulates the revolving door between government and industry. Acoba’s report on Bridges’s new job says: “DExEU confirmed Lord Bridges occasionally met with the chairman of Santander UK” to “discuss the impact of Brexit.”
So as a minister, Bridges met the British boss of Santander to discuss Brexit. Then he left government to work for Santander’s top boss Botin.
Just to show how politics and banking intertwine, Santander’s British boss Shriti Vadera was a “New Labour” government minister under Gordon Brown.
Acoba and DExEU said this was OK because Santander’s Vadera met Bridges when he was a minister “in her capacity as spokesperson for the European Financial Services Chairmen’s Advisory Committee.”
So, because Santander’s Vadera met the minister to lobby on behalf of all the foreign banks in Britain, not just Santander, there was nothing wrong with him leaving government later to become personal assistant to Santander’s overall boss.
Acoba also seemed to think that the fact that Bridges had been Botin’s adviser before he was a minister as well as after he was a minister was also no problem.
Bridges became a minister without ever being elected as an MP. He was a Tory central office official who left the party to become a lobbyist.
Bridges first worked for Quiller Consultants, a lobbying firm that represented various banks and corporations. Then he became Botin’s senior adviser in 2014.
In 2015, Cameron made him first a lord, and then a minister. The former banker’s assistant became a minister without any need for votes or democracy. Now the former minister has become a banker’s assistant again.
Theresa May’s government is trying to tailor Brexit to the banks, working on schemes where most of Britain will leave the EU but the banks in effect get to stay in.
But Santander’s own history shows why we shouldn’t let banking interests run policy.
Botin was CEO of Santander in Britain from 2010 to 2014, so she was in charge when the bank experienced a series of fines and scandals for cheating customers.
Santander set aside £538 million to refund mis-sold PPI in 2012. In 2014 Santander was fined £12.4m for not telling the truth to the customers that bought risky investment bonds.
The bank targeted the over-sixties for investments, falsely telling them they would “likely double” their money. Around 300,000 customers invested in these risky bonds which were sold as safe. Santander was fined £1.5m in 2012 for misdescribing “structured bonds” sold to better-off clients.
It’s worth saying that Santander is not in any way a “meritocratic” firm. Botin’s dad Emilio Botin and her uncle Jaime Botin were both bosses of Santander before her. It is a family firm. And what a family.
Her uncle Jaime will stand trial next year for trying to smuggle a rare Picasso painting out of Spain. He faces up to four years in jail and a £100m fine if found guilty.
Jaime owns the Picasso painting Head of a Young Woman. But the Spanish, who are fiercely proud of Picasso, consider this £26m painting a national cultural treasure. Jaime was banned from exporting it out of Spain.
French authorities boarded his yacht, moored off Corsica, in 2015, believing he was trying to smuggle the painting into Switzerland. They found it and flew it back to Madrid for safe keeping.
The highest courts in Spain came down on him for this, but Jaime said his rich man’s rights come first. He told the New Yorker in 2015: “I am defending the rights of property owners,” adding, “This is my painting. This is not a painting of Spain. This is not a national treasure and I can do what I want with [it].”
His lawyers have also argued that, because the painting was on his luxury yacht, it was “offshore” and, like so much rich folks’ offshore cash, it was beyond the ordinary laws.
However, those laws have now caught up with Jaime and he faces the prospect of imprisonment for smuggling.
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