Tags: Osborne | UK | Banks | Ponzi | Scheme

Osborne Says U.K. Banks Ran Ponzi Schemes Before 2008 Crash

Monday, 03 Oct 2011 10:14 AM

 

Share:
  Comment  |
   Contact Us  |
  Print  
|  A   A  
  Copy Shortlink

U.K. Chancellor of the Exchequer George Osborne said British bank practices before 2008 resembled “Ponzi schemes,” contributing to the market crash.

The crisis was caused “by the mistakes of human beings,” Osborne told delegates at the Conservative Party’s annual conference in Manchester, northwest England, today. He blamed excessive borrowing by the previous Labour government, the creation of the euro and bankers’ risktaking for the economic problems the U.K. faces.

“The banks and those regulating them believed that the bubble would never stop growing, that markets were always self- correcting, that greed was always good, that their ponzi schemes would never collapse, and that none of the debts would ever turn bad,” Osborne said. “They let down their customers, they let down their shareholders, and they let down their country.”

A Ponzi scheme is a fraudulent financial arrangement under which investors are paid high returns from the deposits of subsequent investors. Bernard Madoff was jailed for 150 years in June 2009 for masterminding the largest-ever U.S. Ponzi scheme.

No U.K. banks have been prosecuted for running a similar operation. The British Bankers Association did not immediately return a call for comment.

© Copyright 2014 Bloomberg News. All rights reserved.

Share:
  Comment  |
   Contact Us  |
  Print  
  Copy Shortlink
Around the Web
Join the Newsmax Community
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
 
Email:
Retype Email:
Country
Zip Code:
 
You May Also Like
Around the Web

Newsmax, Moneynews, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, NewsmaxWorld, NewsmaxHealth, are trademarks of Newsmax Media, Inc.

MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved