Everything must change
March 25 2020
During this time of enforced isolation, these quotes from one of my favourite books caught my attention.
They are from The Leopard by Giuseppe Tomasi di Lampedusa: a wonderfully evocative portrait of a Sicilian aristocrat, Don Fabrizio Salina, at the time of Italian unification. His nephew supports unification because “Everything must change so that everything can stay the same”. (The book is beautifully narrated by Alex Jennings here or in Visconti’s gorgeously lush film version).
Don Fabrizio admires his cynical nephew, clever enough to fall in love with a member of the new moneyed bourgeoisie. But he knows that, as a member of the old ruling class, he is part of “an unlucky generation …. suspended between the old world and the new …. and ill at ease in both”.
The Piedmontese politician sent to persuade him to become a Senator in the new Italy is told by Don Fabrizio that he is not suitable. He has no illusions. He lacks “the faculty of self-deception, that essential requisite for anyone wanting to guide others”. The politician needs to look for those who are “good at masking and blending … their obvious personal interests with vague public ideals.”
There have been few better summaries of the political class.
The politician leaves, his final thoughts on the Sicilians summarised as: “All were fundamentally equal. All were comrades in misfortune.”
Not just Sicilians, these days.
A Toxic Culture?
February 14 2020
In March 2017 PC Keith Palmer was killed while defending Parliament from a terrorist. In August 2019 PC Andrew Harper was killed while investigating a suspected burglary. These are only 2 of the 50 police officers killed between 1990-2010. Few of us face the risks ordinary police officers run. This does not excuse what is set out below. It does explain why it is so necessary, if their work and sacrifices are to be worthwhile and the public gets the policing it is entitled to, that the issues raised below be properly addressed.
What follows is not a comprehensive list of every scandal affecting the police. But it is an overview of their range over five decades.
- 1972-1977: Sir Robert Mark’s campaign to root out corrupt officers within the Flying Squad and CID, resulting in more than 500 officers being dismissed or “resigned”. He memorably stated: “a good police force is one that catches more crooks than it employs”.
- 1974-1989: The West Midlands Serious Crime Squad – eventually wound up after allegations of incompetence, malpractice and abuse of power, leading to over 100 cases collapsing or being overturned on appeal. An investigation into its activities led to some disciplinary action but no prosecutions, a decision for which the DPP (Barbara Mills) was severely criticised.
- 1970’s: The activities of various police forces in the Irish miscarriage of justice cases – the Guildford Four (1974), the Birmingham Six (1975), the Maguire Seven (1976).
- 1978-1982: Operation Countryman – an investigation into corruption within the Met and City of London Police in the late 1970’s. Information was released in 2018 about efforts made by the Met and the DPP (Sir Thomas Hetherington) to cover up the scale of wrongdoing and obstruct the investigation by the Hampshire and Dorset police.
- 1979: The death of Blair Peach during an Anti-Nazi League demonstration against the National Front in Southall. In 2010 a police report stated it was likely that a Metropolitan Police officer “struck the fatal blow” and attributed “grave suspicion” to one unnamed officer, who may also have been involved in a cover-up with two colleagues.
- 1981: Operation Swamp, the subsequent Brixton riots and the Scarman report into how the police used their “stop and search” and other powers. Numerous recommendations were made.
- 1980’s – 2010: South Yorkshire Police’s failures in the Rotherham child exploitation scandal. The Jay Report described how the police failed to investigate adequately or at all the reports they were receiving over at least a decade of child sexual grooming.
- 1989: The Hillsborough stadium tragedy. Two reports – the 1990 Taylor Report and the 2012 report by the Independent Panel – described the extent of South Yorkshire Police’s negligence, attempts to shift blame on others and pervert the course of justice.
- 1993: The investigation into Stephen Lawrence’s murder and the resulting 1999 Macpherson Inquiry which found that many Scarman recommendations had not been implemented. Macpherson, unlike Scarman, described the police as “institutionally racist”. Subsequently it was revealed the police had spied on the Lawrence family.
- 2003-2020: The failures of the Greater Manchester Police in relation to Operation Augusta and child sexual exploitation, described in the Newsam report published this week. The report’s statement that: “The authorities knew many were being subjected to the most profound abuse and exploitation but did not protect them from the perpetrators. This is a depressingly familiar picture and has been seen in many other towns and cities across the country.” could apply to a number of places and police forces round the country.
- 2006-2011: Allegations were made during the News International inquiry that the police were selling confidential information to journalists. This was to be looked at in the second stage of the Leveson Inquiry which never went ahead.
- 2009: The death of newspaper seller, Ian Tomlinson, as a result of police assault during G-20 summit protests.
- 2011: It’s revealed that various undercover policemen had infiltrated environmental groups for a number of years, entering into deceitful relationships with activists and fathering children. In 2015 the Met apologized to women “tricked into relationships” over 25 years, closed the units and made financial settlements of circa £3 million. An “Undercover Policing Inquiry” into “appalling practices” in undercover policing was set up. It has yet to report.
- 2012 onwards: Cleveland Police has 5 Chief Constables in 6 years, the first in this list being dismissed for deceit and misconduct. In 2019 it is put into special measures following an independent report describing it as “inadequate” in all fields, “directionless, rudderless and clueless”, “putting the public at risk” with some officers “not acting with honesty, integrity and competence“.
- 2014: Operation Midland into child abuse allegations made by Carl Beech against politicians and others is launched. In 2019 following his conviction on multiple counts of perverting the course of justice, the Henriques Report identifies extensive failings in the original investigation.
- 2015: Police Scotland are criticised by a judge for breaching data privacy laws and the ECHR when spying on journalists and their communications with their sources. Similar breaches were committed by Cleveland Police.
- 2018: The Met’s anti-corruption unit is under investigation for corruption in relation to allegations of assault, racism, child abuse and child grooming.
- 2018: Cliff Richard is paid £400,000 by the South Yorkshire Police for its behaviour over the raid on his home in relation to historic child sex abuse allegations, including informing the BBC about the raid.
- 2005 to date: there have been 4 Metropolitan Police Commissioners. Ian Blair resigned after falling out with the London Mayor; his successor resigned because of his links with one of the journalists implicated in phone hacking; Hogan-Howe lasted 6 years. Under his leadership Operation Midland is set up and people arrested under Operation Yewtree and bailed for lengthy periods without charge, a practice later banned. His replacement in 2017 is Cressida Dick, the senior policewoman in charge when a blameless electrician was killed in 2005 following terror attacks.
- 2020: The Met refers itself to the police watchdog for its failure to act on recommendations made by Sir Richard Henriques to investigate two others for perverting the course of justice in relation to abuse allegations arising from Operation Midland.
- 2020: A review led by a former Met Police Commissioner states that the police are unable to deal with a huge increase in fraud cases.
- 2020: This month a report by HMICFRS on all 43 police forces states that the public has lost faith, having “rumbled” that the police are unable to investigate most crimes. The charging rate in the year to March 2019 fell to 7.8% of all reported crimes in England and Wales.
It is a dismal list. It could be twice as long.
To a financial investigator, this picture is very familiar. Despite innumerable inquiries, changes in the law, disciplinary proceedings, recommendations, new procedures, training, apologies, compensation paid, some prosecutions and that perennial favourite – “lessons have been learnt” – bad, criminal behaviour (which all the people doing it would clearly have known was wrong) and incompetence have repeatedly occurred in forces all over the country over decades. Not one or two “rotten apples”; whole orchards of them. There has been a culture of poor leadership, cover-up or the truth only coming out many years later and of other key agencies turning a blind eye, aiding and abetting or failing to set or demand high standards of probity and professionalism.
Above all, there has been a failure to ask why such problems keep on happening, despite all the remedial steps taken and all the apparent learning of all those lessons.
It is irrelevant that there are many policemen, possibly even the majority, who don’t behave in this way. The same could be said of banking. The professionalism, hard work and good name of the honest good guys are tarnished by the bad, useless ones. The bad drive out – and demoralise – the good.
Policing depends on consent. Trust is essential to that consent. Scandals and incompetence erode that trust. How can our cherished system of policing work then?
Perhaps – like banking – it is time to realise that there is something systemic and deep-rooted and toxic in police culture which allows or encourages or does not stop officers from behaving badly. Perhaps – like banking – it is time to make the hard cultural changes needed if training and rules are to work. Perhaps – unlike banking – it is time for senior leaders to take real responsibility not merely talk about it. Perhaps – like banking – it is time to realise that even successful or vital sectors or professions can in reality be really rather more second-rate than we like to pretend. Perhaps we should stop deluding ourselves that our key institutions are as good as we sometimes rather vaingloriously claim. The police are not the only body of which this could be said, of course.
Law and order are the most basic functions of the state. But the police should not be treated as a sacred cow. A comprehensive, dispassionate and ruthless look at how the police operate and real tough action to change it for the better are needed.
What are the chances?
January 23 2020
One of the saddest aspects of the One Coin scam perpetrated by the now missing Dr Ruja Ignatova is how unsophisticated (and, indeed, poor) savers in African countries were specifically targeted using the claim that this wonderful new cryptocurrency technology would bring easy finance (and all its many advantages) to the unbanked. OneCoin was presented as practically a social service and a revolution in finance which would transform the prospects of those whom traditional finance providers had ignored.
All too good to be true?
Of course. And what this meant in practice for those believing these claims can be heard here in the BBC’s radio documentary – The Missing Cryptoqueen. What it also meant for those involved in handling the money she made was rather more traditional – convictions for fraud and money-laundering.
Investors believed what they hoped was true and failed to ask some basic and obvious questions. If there was no blockchain how could this new currency really be a cryptocurrency? And what was the track record of the person behind it? If they had, they might have learnt that there was no blockchain and that Dr Ignatova had form, having received in 2016 a suspended sentence and fine from a German court for her role in relation to a German metallurgical factory taken over by her, asset stripped and then left to go bankrupt in 2009.
Past performance can sometimes be a guide to the future, it seems.
So what might an investor make of an opportunity to invest in a new venture which will:-
- Package new and existing mortgages into securities to be sold to investors
- The mortgages to be sold to people who have a low uptake of these products, preferring to use their savings to buy land and build property
- In a country – Ghana – with high interest rates and a very recent banking crisis, which resulted in 7 Ghanaian banks collapsing
- On the basis of a study, whose authors have not been revealed, which apparently states that there are plenty of people able to afford a $50,000 mortgage among the 9 million Ghanaians earning more than $11 a day (a munificent annual income of $4,015)
- Promoted by a convicted fraudster (responsible for the UK’s biggest fraud). Yes, Kweku Adoboli is back (though this time it is the economy of Ghana he plans to grow and the balance sheets of (presumably) the remaining Ghanaian banks he wants to expand)
- Who declines to say who his business partners are
- But expects banks to be shareholders in the new venture (assuming actual and potential conflicts of interest can be properly managed)
- And who is still being economical with the actualité of the reasons why he was convicted and imprisoned.
But it is good to see that he has developed a sense of humour – if this quote is genuine: “The day when I deliver my first profit to someone, that will be a good day.”
The injunction “Let the buyer beware” is as sound as ever.