Nothing Has Changed On Wall Street

04/11/2011 22:34 GMT | Updated 04/01/2012 10:12 GMT

I used to work for MF Global. Sadly, a lot of people in London and New York might be able to say the same thing soon. Thousands, in fact. The company filed for bankruptcy this week. Filed for bankruptcy, admitted it can't presently account for the whereabouts of over $600 million of client monies and denied that it had used those same monies in lieu of its own to make massive bets on European debt.

The most important thing to take from this story is this: Wall Street has learnt nothing. The same people who took us to the brink of financial Armageddon in 2007-2008 are still at it. Still executing wild, greedy bets in the hope of taking the upside, knowing they can walk away from the downside.

It would be bad enough if it just hurt their own, but these people threaten us. They threaten our investments, they threaten our government balance sheets, they threaten our economic well-being. And for all that not one - not one - Wall Street sort has been jailed for the crimes of the credit crunch. Am I optimistic that it will be different this time with MF Global? No. I am not.

Congress - of the billionaires, by the billionaires, for the billionaires - has choked all attempts at reform (the funds-starved Frank-Dobbs act has been on life-support since day one) and the SEC doesn't have the teeth or manpower to act.

MF Global say they can't account for $600 million plus of client monies. Their position is "it will turn up". I kid you not. In this day and age any financial company anywhere should know its entire at-risk position and the whereabouts of all monies at the press of a button. How have the regulators not questioned that reckless predicament of any financial institution let alone MF Global? How are these companies run, on the hoof? (The answer to that is, yes, by the way.)

Yet these same people, these Wall Street bankers and brokers and gamblers, come out in their suits and tell us how much money they deserve and how trustworthy they are. The only thing we can trust is that greed colours everything they do.

So, are bankers inherently evil people? Surprisingly, given the regular scandals and crimes, no. So how does it happen? It happens because of the fundamental weakness of every banker: they're human. And humans are greedy and venal and cruel. They can be many other wonderful things, but put them in front of a pile of money and, typically, it only goes one way. And they have to protected from themselves. But I don't want to let them all off. Some bankers are dangerous - very dangerous.

Take the MF Global CEO, Jon Corzine. Former CEO of Goldman Sachs - see how their tentacles reach? - former Governor of New Jersey till he was kicked out at the last elections and now soon-to-be-former CEO of MF Global. I remember when I was at MF Global, the thrill, the frisson of excitement felt by many that this Big Man from Goldmans was coming to take it over. Well, all that glitters is not gold in Wall Street. Sometimes the glitter is the sparkle of white teeth dazzling you with their salesman BS.

Corzine's pitch to the staff and investors at MF Global was that he wanted to turn the brokerage - note that, brokerage, not bank - into a "mini-Goldmans". Well, Corzine left the real Goldman Sachs after a boardroom tussle with Henry Paulson - who went on to be US Treasury Secretary.

Now, you don't have to be a student of Shakespeare to spot a man consumed with ambition, with a furious desire to right what he felt went wrong. And the vehicle for this? MF Global. And the victims of his ambition? MF Global and all its attendant clients. And the man who will walk away from all this scot free despite his hubris and greed and the social and economic costs of his strategy and actions...?

What to do with Wall Street? I have nothing but sympathy for the Occupy Wall Street protestors. They are angry victims who cannot pinpoint exactly who the criminals are but know they hide behind those gilded walls. Should we close down the whole shebang? No.

But the system itself is corrupt. Distorted by the machinations of greedy companies and their Congress-lobbying executives. They have rigged the market, they have bastardised capitalism and laughed at the rule of law. We should regulate it. Regulate it up the place where the regulators don't shine, regulate it as tightly as the nuclear power industry because its fallout is just as toxic to us.

Last week in America a man and his wife got jailed for forgetting to pay for a $5 sandwich. Everybody at MF Global will walk away scot free. It's wrong and only public outrage can change it.