'Investigation into Deutsche Bank - Break it up!'
Chancellor Merkel has failed in the fight against the finance industry. This is the best opportunity for the man who wants to replace her - Peer Steinbruck. He must break up Deutsche Bank.
The police officers who forced their way into Deutsche Bank, on Wednesday of last week, were armed, even though they could not have been expecting violent resistance from the bankers inside. However, their weapons were a powerful symbol. They were a sign of the special danger that the State attaches to the suspects: Bankers can also be serious criminals. They can hold whole societies to ransom.
It is the Chancellor's greatest failure that she has done nothing to contain the power of these people: and it is the greatest opportunity for the man who would replace her.
The State has fired a warning shot. The bank has already challenged it. It concerns the trade in CO2 certificates and the suspicion of serious tax evasion. Millions are at stake - once again. The investigation has already been running for a long time. Deutsche Bank had promised to cooperate, but the investigators felt that they were being taken for a ride. Deutsche Bank put down obstacles. Worse still. Der Spiegel writes in its cover story that evidence may well have been destroyed. One reads of 'intentional help' for tax evasion on a massive scale.
Deutsche Bank - the largest bank in the country - has frankly been behaving like a drug cartel: keep quiet, cover up and carry on. Now even co-CEO Juergen Fitschen is at the centre of the criticism. He recently said, 'It is often said in public that the banks don't want to be reasonable, that they don't want to learn (from their mistakes). I, in contrast, assert that we are reasonable, that we have taken the appropriate steps and that we will take further steps.'
In truth, the bank has wasted the opportunity to act in a timely fashion. So the State has taken over. The gloss has gone, this bank will not shine so quickly again. It's not just about this case. There is also the court decision that the bank must pay compensation to the heirs of Kirch. The allegations from Saxony are that the Frankfurt based bankers (at Deutsche Bank) unloaded so-called Residential Mortgage Backed Securities onto the Landesbank - securities that were 'of poor quality' and that 'Deutsche Bank knew this' - so it is stated in the court application. The behaviour of the bank was 'brazen fraud'. Add to this complaints and inquiries from the USA and other countries, according to which Deutsche Bank allegedly lied and cheated. Even though, in each individual case, the presumption of innocence must apply and even if Deutsche Bank manages to reject some of the allegations, the damage is done. Their reputation is ruined.
The Bankers have lost all sense of proportion
What does it take to be a good banker?
At the beginning of the sixties, Hermann Josef Abs said, 'First of all the ability to think about the interests of the customer, secondly, to have the courage of their convictions, thirdly, to weigh the degree of risk.'
At that time, it was an essential feature of banking that it was quiet, serious, almost a bit boring. Bankers were also powerful back then but they made sure to stay within the letter of the law.
Since then they have lost all sense of proportion. This is a hallmark of capitalism as a whole, since the so-called socialist countries collapsed. Banks had little to do with the Socialist system. Banks were what the sociologist Oskar Negt calls a 'demarcation reality'. They gave the Western system a legitimacy which has since evaporated.
The company that was once the centre of Germany Inc. now stands suspected of particularly well organised criminality. This bypasses the selfunderstanding of the bankers at Deutsche Bank. What did co-CEO Fitschen do once the State lawyers had left the building? He telephoned the Minister-President of Hesse, Mr. Bouffier, to complain. He is obviously accustomed to do this. Boufffier ignored him. However, the episode shows what you could hitherto expect as a banker at Deutsche Bank from the Minister-President.
The time for joking is over.
This is the failure of politics. It has failed to set boundaries for the bankers. In autumn 2009, Angela Merkel said: 'We need rules - for each product, for every location in which they are traded, and for every institution .... No bank should be so large that they may ever again blackmail countries.' Words which were not followed by any deeds.
After Fukushima, Merkel managed to phase out nuclear power, but after the meltdown of the financial sector, she was unable to achieve a similar coup. In dealing with the nuclear lobby, the Chancellor was able to summon her courage. Confronting the banks, her courage deserted her.
As a result of all the banking scandals of recent years, the credibility of Germany's largest banking institution has been destroyed. The bank should be broken up. Peer Steinbruck, the SPD candidate for Chancellor, has put forward a plan as to how the credit and securities trading divisions can operate separately under the umbrella of a holding company. That is a sensible idea.
Steinbruck, who in the past was happy to be invited out and paid by the banks, has boasted that he has never said anything (to the banks) that they liked to hear. That may well be true. The banks have listened to his scolding, just as a King listens to the scolding of a Fool.
The SPD candidate can use the forthcoming election campaign to make it clear to the banks that the time for joking is over.
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