The ‘Smelly Poo Index’ on banking fraud

Bank of England

The Bank of England Mark Ramsay under a Creative Commons Licence

There are four distinct ‘Smelly Poos’ developing from the scandal of foreign exchange fraudulent manipulation by the banking sector. Thus far, US, British and Swiss regulators have fined JP Morgan, Citibank, RBS, HSBC and UBS a total of $4.3 billion, and more fines are expected on Barclays Bank amongst others.

As a Lloyds Bank whistleblower and campaigner, I have devised a Smelly Poo Index system to reflect the growing anger at the refusal of British and US governments to prosecute senior bankers for criminal fraud for PPI mis-selling, interest-rate swap mis-selling, Libor manipulation and foreign exchange manipulation.

Or in plain English – theft.

Smelly Poo Index Ratings (from least bad to worst)

Fourth Place, with a 87-per-cent reek-stench rating, awarded to The British Conservative-led government

The government has refused to prosecute senior bankers for criminal fraud. There is an unhealthy relationship between the financial sector in the City of London and the donations the Conservative Party receives from them.      

Conservative Party backers/donors are dominated by City of London donors, including over £1 million ($1.5 million) handed over by hedge funds since July and, hey presto, there are no government-led actions to prosecute senior bankers at RBS, Barclays, Lloyds or HSBC for foreign exchange, Libor, interest-rate swap mis-selling, or PPI mis-selling.

Third Place, with a 89-per-cent reek-stench rating, awarded to The Bank of England (BoE)

BoE knew of foreign exchange (Forex) manipulation risks in 2006. Martin Mallett, the bank’s chief foreign exchange dealer, was suspended in March 2014 and dismissed in November for ‘serious misconduct’, only hours before the Forex fines were announced against the banks.

He is reported to have failed to escalate his concerns about the risks of foreign exchange manipulation, though BoE denies that any bank official was involved in ‘any unlawful or improper behaviour’.

So, if no Bank of England official was involved in any improper conduct, why the contradictory behaviour in dismissing Martin Mallett? Very odd.     

Second Place, with a 91-per-cent reek-stench rating, awarded to Britain’s Financial Conduct Authority (FCA), the City’s regulatory body

The FCA investigations into banks’ manipulating of foreign exchanges tasked the culprit banks to conduct their own in-house investigations. The Financial Times reports that the FCA relied on the information given to them by the offending banks and their lawyers: ‘The FCA has not interviewed some of the main individuals concerned.’

There is a very smelly odour surrounding the concept of the thieves being asked to investigate their own theft with the help of the legal profession and indeed the UK regulators.

First Place, at a 99-per-cent reek-stench rating, awarded to past and current board-level directors of HSBC, Lloyds, Barclays, RBS, JP Morgan, Citigroup, Bank of America, UBS etc. 

According to Mark Carney, the governor of the Bank of England, top banking executives ‘got away without sanction’.

‘Maybe they were not at the best tables in society after that, but they’re still at the best golf courses. That has to change,’ he said.

In Britain and the US, not one board-level director in the banking sector has been charged with fraud since the banking crisis in 2008.

Whistleblowers are us

Whistleblowers are often the source of information and evidence which exposes corruption or abuse within corporate or government organizations and publicly funded agencies (such as the National Health Service (NHS) or care homes). Think of Bradley Manning who supplied Wikileaks with data on US military secrets; Deep Throat, whose evidence exposed President Nixon; or Professor Steve Bolsin, who revealed the alarmingly high rates of child deaths at Bristol Royal Infirmary.


Now, a new group, Whistleblowers UK (WBUK) has been formed to help those who dare to speak out. The inaugural conference of Whistleblowers UK was held on 15 March and organized by Paul Moore (HBOS whistleblower) and Gavin Macfaden, Director of the Centre of Investigative Journalism. Some of Britain’s most famous whistleblowers travelled from all over the country to attend, including Dr Kim Holt (Baby P’s death), Eileen Chubb (abuse of elderly in care homes), Ian Foxley (allegations of bribes by British defence contractors) and Andrew Feinstein (ex-South African politician who exposed bribes to government ministers).

WBUK is best described as a mutual self-help group of whistleblowers set up to offer support to fellow whistleblowers. Its mission is to:

1. Protect legitimate whistleblowers from intimidation and threats;

2. Provide, in complete confidence, mutual support, help, advice and friendship to legitimate whistleblowers through practical measures such as personal visits, regular supportive phone calls and conferences and, in extremis, financial help;

3. Collectively lobby and influence policymakers within government and parliament and other institutions. For example, the group has already successfully lobbied the Parliamentary Commission on Banking Standards to recognize that the WBUK banking and accountancy members can assist the Commission and provide valuable insights into reasons for misconduct within the financial services industry.

4. Provide practical support in accompanying whistleblowers, as witnesses, attending court sessions or meetings with regulators.

5. Provide witness, evidence and information where appropriate to the British and international media on matters of corruption and abuses and on whistleblowing issues.

6. Protect our democracy from corporate and state abuse.

Current campaigns include putting legitimate pressure on the NHS and care sectors to ensure the standards of dignified and compassionate care are applied to vulnerable patients. (See Compassion in Care and Patients First), as well as campaigns relating to issues concerning senior level conduct within the Lloyds Banking Group which the Financial Services Authority and the Crown Prosecution Service are investigating. WBUK members have also alleged irregularities within large accountancy auditing firms.

Join WBUK for its launch event on 12 December! The launch will take place from 12.30-2pm in the Oliver Thompson Lecture Theatre at City University London, EC1V 0HB (Please use the main Northampton Square entrance to University Building).

Help WBUK build up its readership support and spread the word by subscribing to the WBUK website:

Ian Taplin is a founding member of WBUK and can be contacted via the Don’t Bank on Lloyds’ Ethics website.

Illustration: Electronic Frontier Foundation under a CC Licence.

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