Now that the Libor scandal – along with other questionable goings-on are unfolding, is it a coincidence that lobbying filings are down for some banks? The Center for Responsive Politics’ just reviewed the filings for dozens of banks and it would appear those who are being closely audited have a significant drop in those lobbying expenditures.
Barclays, which is at the heart of the current Libor scandal, has already been fined and its CEO, Bob Diamond, announced his resignation last month. The fines were a result of manipulations to the data that affected interest rates around the world, known as Libor. Those expenditures for lobbying efforts were down considerably in both the first and second quarters of 2012. In the first quarter, it totaled $450,000 and in filings released in recent days for the second quarter, that number dropped to $160,000. Its first and second quarter reports for 2011 totaled $2.3 million.
Another bank that’s been named as suspect in the scandal is Bank of America. It too shows the same pattern. It’s lobbying expenses are down almost 15% in the first two quarters of this year compared to the same time frame last year. Its total for 2012 is slightly lower than $1.4 million. But when compared to just the second quarter in 2010, it’s a rather sharp decline. Between April and June of that year, it had already put out close to $2 million.
What’s most disturbing, however, is the report released by the Senate this week. An investigation uncovered HSBC’s ties with money launderers and worse, what some are saying are terrorist backers. Already one of its top managers has resigned, suggesting there’s more coming in the coming weeks. Interestingly enough, even as Barclays’s, Bank of America, and of course, JPMorgan Chase, are trying to fly under the radar these days because of the Libor investigation, HSBC is one of only two banks that’s seen its lobbying expenditures climb.
Its total pay out in lobbying fees is up 65% from the same timeframe last year. Capital One is the other bank with an increase, including $610,000 in lobbying fees for the US government between May and June, which is an increase of just more than 28% from the second quarter of 2011. Citigroup is expected to have its numbers released soon, too.
Remember, the Consumer Financial Protection Bureau put Capital One in its crosshairs and following its investigation, it charged the credit card company under the new Dodd-Frank law to the tune of $150 million, which will be refunded to the card company’s customers in the coming months. Capital One was found to have both pressured and misled its customers to buy unnecessary services, such as various insurance policies and ID theft protection.
Even if the full story hasn’t yet emerged, many who were involved in these investigations say there’s more coming and it’s not looking good for several global banks, including those who have home bases here in the states. The Libor scandal, they say, is just heating up.