“In
November this year, the European Central Bank begins supervising the
biggest banks in the European Union. From now on, the main
responsibility for detecting risky banking, or banks that are
outright failing, rests with that institution. Preparation has been
ongoing since the so-called Single Supervisory Mechanism [SSM] was
adopted by the Council and the European Parliament in the autumn of
2013. Rules on ethics were part of the considerations leading up to
the approval, but it seems the ECB was not concerned with people
with close ties to the very megabanks the SSM is supposed to
supervise.”
“The
European Central Bank gets considerable powers* with the SSM. It can
approve, reject, or annul a licence for a bank; it can order
restructuring, impose a new leadership, and it can order
capitalization in case a bank appears to be too vulnerable. All
this to make the European banking sector more resilient. The draft
decisions are made by the Supervisory Board and presented to the
Governing Council of the ECB for a final decision. But should a bank
want to object to the report of the Supervisory Board, it can file a
complaint to the Administrative Board of Review, a panel of only five
persons.”
“Over
the past years, Corporate Europe Observatory has highlighted
several cases where the ECB has shown to be very close to big banks.
They include the membership of ECB President Mario Draghi of
the Group of Thirty – a club for central bankers and some of the
biggest banks in the world – that has served as a lobbying vehicle
for specific reforms of financial regulation that favoured big banks,
including in the years preceding the financial crisis.”**
“The
strong presence of big banks in the advisory groups of the ECB has
been an additional cause of concern. Also, there are important
international experiences that should be taken into account. In the
aftermath of the financial crisis in 2008, an investigation into the
Federal Reserve in the US was conducted. Though initially
confidential, the report has been made public. It testifies to severe
'regulatory capture' inside the Federal Reserve – an experience
that should not be repeated on European soil.”
“When
preparing for the European Central Bank's new mission as the main
supervisor of the biggest banks, it was decided by the Council, the
European Parliament, and the ECB that new rules on revolving doors
would be appropriate. As a result, the ECB will impose a two year
'cooling off period' that will bar ex-employees from taking up a
position with a private bank for two years. This move is most
welcome, and will take the ECB ahead of the Commission on ethics
rules concerning revolving doors. However, revolving doors go both
ways, and the admittance of people from the private financial
industry to high posts can lead to other kinds of problems.”
“... in
the case of the ECB and its Administrative Board of Review, rules on
employing staff from private financial companies are absent. Also,
the 'declaration of interest' that the members of the board are to
complete upon appointment, seem to be nothing but a solemn promise
with a signature.”
“While
the ECB meticulously guards its independence from member state
government agencies in the decision on 'the establishment of the
Administrative Board of Review', strikingly there is no parallel text
on independence from private companies.”
In
details:
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* The official declaration
of the European hegemony of “bankcracy” with the signature of
Mario Draghi, is now a fact. The European Central Bank, ECB,
becomes the absolute dominant, through the unlimited purchase of
government bonds in eurozone, and the Frankfurt bankers are
preparing for their biggest party so far. As expected, the
bank-occupied media rushed – once again – to crow. In essence,
the decision means that Europe passes into a hastily, coercive
federalization, in terms that serve exclusively the destructive
neoliberalism. The ECB is converted into an equivalent European
Fed, which means, gaining complete control of the money flow
through the whole eurozone.
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