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Regulatory rent-seeking: Difference between revisions
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If they seem [[calculated]] to raise funds from the ongoing proceeds of profitable businesses, whatever their turpitude, that looks more like an extortion racket than prudential regulation. After the Global Financial Crisis worldwide regulatory fines coming down on banks had less and less to do with real harm and bad conduct, and more to do with monetising dominant positions over cash-rich institutions that didn’t have the present political credibility to argue back<ref> For example, [https://drs-als.com/but-for-the-grace-of-god-bony-receives-record-fine-for-cass-breaches/ hundred million dollar fines for custody breaches where no customer assets were lost at all]</ref> — it doesn’t look like you are ''preventing'' bad conduct as much as ''enabling'' it. This looks like rent-extraction. | If they seem [[calculated]] to raise funds from the ongoing proceeds of profitable businesses, whatever their turpitude, that looks more like an extortion racket than prudential regulation. After the Global Financial Crisis worldwide regulatory fines coming down on banks had less and less to do with real harm and bad conduct, and more to do with monetising dominant positions over cash-rich institutions that didn’t have the present political credibility to argue back<ref> For example, [https://drs-als.com/but-for-the-grace-of-god-bony-receives-record-fine-for-cass-breaches/ hundred million dollar fines for custody breaches where no customer assets were lost at all]</ref> — it doesn’t look like you are ''preventing'' bad conduct as much as ''enabling'' it. This looks like rent-extraction. | ||
Fining an outfit $40m when, on your own theory of the case, it has generated ''billions'' through fraudulent deception of investors — well, that’s just protection money, isn’t it? <ref>Grateful to @Chill_letChill for this insight. | Fining an outfit $40m when, on your own theory of the case, it has generated ''billions'' through fraudulent deception of investors — well, that’s just protection money, isn’t it? <ref>Grateful to @Chill_letChill for this insight. </ref> | ||
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