Employees at AIG’s financial products division made a gamble. They lost billions of investor money and the American Government had to swoop in with a $170 billion in tax payer money to try and stop a few banker errors from collapsing the world’s financial systems. This kind of gamble by bankers happens every day all over the world trying to use our hard earned money as funds to make their investors richer. Note that whether its taxpayer money or investor money its still the average American who’s losing his cash to prop up banks whose only job in the world is to keep money safe. So in a democracy like America and India why is it that bankers have so much power? Why are the people trusted to manage our countries finances so lackadaisical? Every banker seems to have chosen finance as his career option purely for the luster of becoming rich and a startling six-figure salary. What goes through the mind of a young and budding banker while he or she decides to spend the rest of their lives managing other peoples money? If weren’t for the prospect of making a lot of their own its impossible to see why anybody would get into banking. Now that the system has churned out these ‘dedicated and sincere’ bankers, its time to hand over the worlds financial reigns straight into their palms, of course showering them with bonuses and perks all the way. When the unfortunate time comes that they mess up and the waters get choppy they are offered ‘retention bonuses’ to ensure they don’t jump ship and their ‘talents’ were retained.
Perhaps this whole financial mess was a one off mistake that was caused by bankers all over America making mistakes at the same time. Perhaps it will never happen again but either way they have too much power than their job detail, which can be classified as a glamorized math teacher. Bernie Madoff is a classic example of that. He has pleaded guilty to eleven charges in his illegal ponzi scheme which managed to pull the wool over thousands of investors eyes including some major banks. $ 65 billion was siphoned off and it’s unlikely those investors will ever see the green side of that money again. Madoff was caught because he was getting old (he’s 70). It may be a scary thought to assume that there are hundreds more young hotshots like him working the system till it runs dry and who will disappear into the sunset with billions of hard earned money. In India there is little that money cannot do. So it is even more distressing that what little infrastructure there is to detect this kind of fraud can easily be muscled aside by a wad of cash. Satyam is a case in point and though its founder Ramalinga Raju is safe behind bars a question that begs to be asked is where did all the money from India’s fourth largest IT firm disappear to? Was he alone in his cover up of Satyam or is he just a fall boy for a much larger conspiracy? And if this can happen to a company of this scale (Satyam is listed on the New York Stock Exchange) then what is the real level of corporate fraud happening in middle and lower rung companies.