egafd.com

A bit of info for you.

Barclays Bank has admitted it paid just ?113m in UK corporation tax in 2009 ? a year when it rang up a record ?11.6bn of profits. This represents under 3% of their profits. The current rate of corporation tax in the UK is 28%.

Bob Diamond, the head of Barclays, told the parliamentary committee that Barclays paid over ?2bn in taxes to HM Revenue & Customs in 2009, but it is now clear that most of this is payroll taxes for employees i.e. most of that total would be income tax and national insurance paid by employees which the banks hand over on their behalf.

Analysts argue that the combination of tax avoidance strategies with subsidiary companies together with losses brought forward means that banks will be not be making a meaningful contribution to corporate tax for some years."

Diamond also confirmed to Umunna on the parliamentary committee that Barclays Bank had 30 subsidiary companies in the Isle of Man, 38 in Jersey and 181 in the Cayman Islands. It uses these companies for complex tax avoidance procedures.

Meanwhile, councils take a scythe to front line services and jobs whilst the banks come out of this with their pockets stuffed with wonga.

Cheers
D

"A Big, Big Bank for a Big, Big World"

Stick it up your arse Mr Diamond (and Mr Hopkins).

Meanwhile, councils take a scythe to front line services

What I dont get is the local councils making cutbacks but the council tax goes up. Whats that all about?

As for the parking charges...someone somewhere is pocketing all this money

I'll chuck my two penn'orth in - though since the bank crisis I'm not sure I can afford it!

The initial problem was the preparedness of the mortgage brokers to lie about their clients' income so as to generate commissions for themselves for selling more mortgages. The banks have to take some of the blame for this as the incentives they offered were ripe for abuse.

The banks saw all these mortgages as an income stream and, whether or not they realised the loans had been given to people who were almost guaranteed to default, they should have had procedures in place to check such things. If they didn't know, they were negligent, if they did know, their actions were criminal.

Having got all these debtors, the banks saw another opportunity to make money off them, by selling the debt onwards, so getting money up front in one big block instead of waiting for the piddling monthly payments from each loan. Because the debts were "collateralised", meaning there was a physical asset - i.e. houses - on which the loan was guaranteed, these debt packages appeared to be relatively low risk to potential investors.

Unfortunately, the business was so crooked that some houses had been re-mortgaged several times over (because the people in them had to refinance over and over because they couldn't afford the payments) - a detail so lost in the paperwork that it was damn near impossible to spot.

The banks packaged the individual mortgages into large blocks where the debts in a particular group were supposedly of similar risk and sold them on. The higher-risk loans were sold more cheaply but offered greater returns, so some investors went for those. But even the lower-risk blocks weren't as safe as the investors believed because of all the back-room wheeler-dealing.

Unfortunately, it all came crashing down when many of the debtors started defaulting on the loans. The income stream slowed almost to a stop, meaning the investors couldn't pay back the money they'd borrowed to finance their purchase of the debt blocks.

At the same time, the flood of repossessed homes onto the market lowered overall house prices and significantly reduced the value of the collateral behind the remaining loans.

The banks that loaned money to the investors who bought the now-toxic debt packages now panicked and started calling in the money they were owned, and the whole incestuous, criminally greedy enterprise disappeared up its own fundament.

So, yes, the banks - and human greed - were to blame.