Is there a silver lining for the scandal now nicknamed Lie-bor?
Probably not for Barclays Plc, but maybe for the U.S. Treasury.
Barclays admitted last month to submitting false London and euro interbank offered rates. It now owes nearly half a billion dollars in punitive charges: 59.5 million pounds to the Financial Services Authority, $160 million to the Department of Justice and $200 million to the Commodity Futures Trading Commission.
Since penalties the CFTC and DOJ collect become part of the country’s operating budget, the U.S. Treasury will soon find itself $360 million richer. Considering the hundreds of federal programs that could use the cash or whose budgets have been cut by millions, a host of possibilities exists for the record-breaking fines.
– Helping predict the weather by footing the $322 million requested (and denied) to create a national Climate Service?
– Refunding the estimated $360 million in American tax dollars lost to Afghani criminals and power brokers through the government’s combat support and reconstruction contracts?
– Promoting offshore oil and gas development oversight by funding the $358 million earmarked for reforming the system this year?
– Purchasing 70 million drumsticks to promote governmental teamwork on par with the General Services Administration’s exceptional camaraderie.
While true that $360 million won’t make a large dent in the country’s $124.6 billion budget deficit, if the other banks under investigation are required to pay fines anywhere close to those of Barclays (Morgan Stanley predicted it will pay $650 million), the Treasury alone could be looking at upwards of $4 billion in spare change.
Not a bad haul for an otherwise struggling pocketbook.