That\’s an interesting question Ritchie

On the subject of Barclay\’s being fined for handling transactions with people/countries on the US no trade list:

Does banking have any ethics at all?


Barclays is understood to have voluntarily disclosed information on the dealings to the authorities after it became aware it might have broken sanctions.

As well as co-operating with the US investigation, the bank ran an internal inquiry into transactions conducted between January 2000 and July 2007.

This saw more than 175 current and former Barclays employees interviewed and in excess of 100m records examined.

Disclosures from Barclays\’ own investigation led to the bank being charged by the US Department of Justice with one count of violating the International Emergency Powers Act and another of trading with the enemy.

I dunno about you but I\’d take \’fessin\’ up to having been a naughty boy as being ethical, yes.

5 thoughts on “That\’s an interesting question Ritchie”

  1. How could an abstraction – “banking” – have ethics? Bankers might, I suppose, as a logical possibility; but if they do, they might not be ethics I’d much approve of. Or does he mean ethics like his own, where attempting to propagate intellectual confusion is apparently moral? Bankers might well subscribe to that.

  2. It is rather simplistic of him to see the issue as one of ethics. The problem is the US unilaterally impose sanctions with extraterritorial application. See this Chatham House discussion.

    The US often use sanctions as a weapon of foreign policy. So which law should firms be obliged to comply with – US, UK or EU? Moreover, the US sanctions often breach WTO rules. Therefore, the UK have on occasions when the US have imposed extraterritorial sanctions enacted blocking statutes, which prohibit companies from applying them. If it is UN sanctions that is quite different.

    Subsidiaries with no connection to the US can get dragged in and may find themselves liable in the US courts. Take this example from Chatham House. A foreign subsidiary of a US company acquired a European subsidiary with a Mexican subsidiary which was doing business with Cuba. The company had conflicting obligations under EU law and US law and OFAC threatened to impose heavy fines, which resulted in the subsidiary being sold.

    It can’t be seen as an ethical issue when complying with US sanctions means firms are breaking the law in their home territory.

  3. Why does Barclays (predominantly British listed?), have to kow-tow to U.S. trade laws like this anyway?

    Surely the U.S. bits of Barclays could refuse to cooperate with Cuba and Iran, thereby leaving the non-U.S. bits to do as they pleased in terms of merrily trading with any and all Communist and theocratic lunatics if they so wished.

  4. It seems to me that it’s probably a tax issue. If they want to get away with paying tax as a single entity (and thus paying it where they can pay the least presumably), then they likely have to all obey all relevant rules that would apply to any one part.

    I expect the US part could be siphoned off into a separate company, but then it would have to pay tax on all of it’s earnings at the US rate, which may be higher than desired.

    This is pure speculation, mind – I could be completely wrong 🙂

  5. I look forward to the day that some employee of Murphy does something illegal, immoral or unethical, with Murphy quite innocent and ignorant, and hopefully even with a Murphy designed system in place to prevent it.

    Then we can all dance and scream, call Murphy himself illegal, immoral or unethical, and sling his own feces back at him.

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