RBS/Libor. If Iceland can prosecute bankers why can't we?

If you're shopped by your ex-wife for point switching on a speeding ticket you face prison; if you are in charge of a department responsible for one of the biggest financial scandals in history, you get a £700,000 pay off. Well, that's what has happened to the Royal Bank of Scotland executive, John Hourican, who has agreed to step down over the Libor fixing scandal. Step down, mind you, not accept responsibility, let alone admit to any wrong-doing. RBS insists that Mr Houlican had no involvement in, or knowledge of any manipulation of Libor interest rates.

So, er, why is he stepping down? What kind of justice allows companies to nominate someone to shoulder the blame who is blameless in order to divert blame from those who are guilty? Why couldn't Chris Huhne just nominate his driver to take taking the rap for his speeding ticket, while of course making clear he had no knowledge of any wrong-doing and therefor isn't responsible.

The RBS scandal is another nail in the coffin of British - and Scottish - banking. This omni-scandal is giving us all indignation fatigue. It's hard to remain apoplectic with rage month after month, year after year, as bank criminals are allowed to hide behind presentational resignations and get fines that are paid out of tax payer's money.

Oh, sorry, I forgot. Vince Cable, the business secretary said yesterday that RBS bankers will pay the £390m Libor-fixing fine from their bonus pool. But where exactly did this bonus pool come from? Yes, the profits of the STATE OWNED Royal Bank of Scotland. This fine isn't being paid by the bankers but by us. It is an insult to tax payers that these executives are earning bonuses at all when they owe us for the £65bn for the recapitalisation -  plus interest on two hundred billions of public money used to underpin the value of Royal's dodgy loan book in 2008/9.

Let us remind ourselves of what banks like RBS, UBS and Barclays have been up to.

Epitaph for the Age of Irresponsibility

     “An epitaph for an age of irresponsibility”, is how the Chancellor, George Osborne, described the Barclay's Libor-fixing scandal in the Commons last week. It was, he went on: “symptomatic of a financial system that elevated greed above all other concerns and brought our economy to its knees”. If even a Tory Chancellor has finally got it, can we expect real action to sort out Britain's banks? Don't hold your breath.

The manipulation of Libor – the London Inter-Bank Offered Rate - has been common knowledge in financial circles for years. The Economist has been writing about it at least since 2008. The idea that the British Bankers Association didn't know what has been going on is laughable. Every barrow-boy in the City knew the banks had been fiddling their borrowing costs in order to disguise their distress after Lehman Brother's crashed in 2008 and interbank lending almost froze. By manipulating their borrowing costs, banks like Barclays were able to convey the impression that they were in less financial stress than they actually were.