$7m is pocket change for Citigroup.
No wonder the big banks keep shitting the bed. There's never any real consequences for their fuckups.
No wonder the big banks keep shitting the bed. There's never any real consequences for their fuckups.
Instead of something sensible like "you trade, you report", the regulators have set up a patchwork of formats, inclusion criteria and target agencies that pretty much ensures that lapses like this occur. Turning Frank-Dodd into workable code is fucking hard: I spent a couple of years pushing that boulder up the slope until I ragequit a couple of months ago.
The regulators should be ingesting data in one place and running analytics on a data lake. The banks are so sick of spending money dealing with the lack of regulatory technical competence that they'll probably happily pony up a couple of billion dollars between them to set up the surveillance system for the Feds; doing it once is cheaper in the long run than repeating the same set of mistakes at every bank on the Street.
26810 requests, do you think they made more than $7m on this?
It's about proportional fines. Just because they're a giant company doesn't mean we should find then $1b for forgetting to put a handicapped parking space at one of their offices.
I think Finnish speeding fines are a percent of income.
In the infamous McDonald's coffee lawsuit, this was actually the motivation behind the initial large damage award. The jury attempted to award punitive damages equal to two days' worth of McDonald's coffee revenue.
(obligatory note here for the many people who have heard false information about that case: the coffee spilled in a car, yes, but the car was motionless, in a parking space, and the person who spilled it was not the driver, and was found partially at fault for the spill; she suffered severe burns requiring hospitalization and skin grafts, which is not generally what one expects from coffee; it was found McDonald's served its coffee significantly hotter than other chains, in a temperature range making burns more likely, and was aware of the fact that it could cause severe burns because this wasn't the first case, and in fact McDonald's was aware of hundreds of cases of burns resulting from its coffee; the initial damage award was significantly reduced by the judge; search for Liebeck v. McDonald's for more details)
I feel like this school of thought is also the one that ends up with things like "3 strikes and you're 25-to-life"
On the other hand I think there is a gulf of difference between "3 strikes" laws and punitive damages being awarded against a company for an arguably frivolous lawsuit.
The former will disproportionally target people who are relatively disadvantaged, e.g. people living in poverty or drug addicts, and ruin their lives.
The latter (in this case) targeted a multinational corporation, with the damages being around 0.01% of its annual profit or less. McDonald's can survive that. Even if a person or two in the chain of command get fired, there's a gulf of difference between losing your job and getting locked up for 25 years.
I know you're not talking specifically about mcd coffee suit, but there's nothing arguable about that one; because there's still some measure of belief that it was frivolous here's a quote taken from the wikipedia article[0]:
> Liebeck was taken to the hospital, where it was determined that she had suffered third-degree burns on six percent of her skin and lesser burns over sixteen percent. She remained in the hospital for eight days while she underwent skin grafting. During this period, Liebeck lost 20 pounds (9 kg, nearly 20% of her body weight), reducing her to 83 pounds (38 kg). After the hospital stay, Liebeck needed care for 3 weeks, provided by her daughter. Liebeck suffered permanent disfigurement after the incident and was partially disabled for two years.
[0] https://en.wikipedia.org/wiki/Liebeck_v._McDonald%27s_Restau...
This is not incompatible, the school of thought still wants to achieve that.
"this crime is minor and deserves a minor punishment of level 2 suffering, what's a good way to inflict level 2 suffering on this individual"
I disagree. I think it's reasonable to expect that coffee and other hot drinks might be all the way up to boiling.
> in a temperature range making burns more likely
Is there a particular range for burns? Isn't it simply that the hotter it is, the more burns you get?
http://www.ncbi.nlm.nih.gov/pubmed/18226454
Injury time is logarithmic:
http://www.accuratebuilding.com/services/legal/charts/hot_wa...
What? Absolutely not. I'm just saying that it sounds reasonable to believe that burns increase with temperature, as opposed to being high in a range of temperatures and lower below and above that range. Figure 4 in your first link agrees with this common-sense guess.
I think it's also pretty clear just from the burn time curve. If it takes you a second or two to notice the heat and move away, then anything above ~155F is going to make a burn much more likely. At 180F, the burn is basically instantaneous. Whereas at 140F, having five seconds to respond gives you a lot of time to move, shake off the liquid, et cetera.
Which makes it sound like there is a lower and an upper bound for this range. That's the issue.
But even with your interpretation, it's true. The upper bound is 212F. A cup of steam is not a significant burn risk, that being something like 0.16 ml of water.
Yes and no. Lesser infractions are static amounts, larger ones are based on day fines, they determine the amount of days -> units for the fine based on the severity of the infraction and the units are used as a multiplier against your daily income for your fine.
What should happen - all of the management at Citgroup should have to attend a 5 day training provided by the SEC showing how they can fix the reporting problems they have. How it causes problems to society. How it is dishonest - and how it wastes taxpayers dollars.
I'm betting having that happen to Citigroup 2 or 3 times a year would really make them think about following the rules.
Plus - its positive reinforcement instead of negative (punative) damage.
some (a lot) people would like to see banks burn, in same way common folks enjoyed public decapitations of ruling classes in french revolution. not judging, hard topic on its own, probably depends on where you are positioned in your life.
They made a mistake, a programming mistake no less, something many people here have done.
Then fully admitted it when they found out.
Yet this is them being evil?
No wonder people vote against the left.
- incompetent and/or careless employees and managers
- dishonnest employees
- computer bugs, glitches, clerical errors
If you take down a large corporation every time you find any of these, there will be no corporation left within a year. Just small companies that were statistically lucky to have neither of those that particular year.
Name me a program, any program (other than Hello World) where no bug has never been found!
People make mistakes, but these mistakes should be caught before they get into production. And the ones that still make it into production should be hunted.
Financial companies are held to extraordinary standards, and in my opinion it's a game they cannot win.
We could talk about the OS driver shit show too!
Citigroup screwed up. Now they have to pay a fine. If they get off the hook for free, how is that fair to their competitors, who also had to do this rather tedious reporting?
Same here,
[1] http://www.reuters.com/article/us-citigroup-settlement-doj-i...
If Citygroup has a habit of hiring and fostering employees who turn a blind eye and keep their mouths shut, then they should be punished severely.
If no one knew, the managers who were tasked with setting up procedures and systems for knowing, should be punished.