Swiss Bank’s Corrupt Influence Poisons U.S. Political Process
By Pete Papaherakles
UBS, the Swiss megabank that was slapped with a $1.5B fine in December for scamming European interest rates, is no stranger to corruption. But while the bank has been repeatedly accused of corruption in recent years, it remains a huge donor to United States politicians and is a major lobbyist on Capitol Hill.
UBS is headquartered in Zurich, Switzerland, with its American operations based in New York. The financial giant is the largest bank in Switzerland and the second largest European bank. It is also considered the world’s second largest manager of private wealth assets, with over $2.2T in invested assets.
Even though UBS has paid more than $1B in fines for financial crimes in recent years, that doesn’t seem to have scared away many lawmakers or President Obama who have received generous contributions from the megabank. In the last decade, it has tended to give more campaign money to Republicans, which is most likely due to the fact that Republicans have been actively seeking to roll back recent financial reforms put in place following the collapse of the U.S. economy in 2008.
Last month’s LIBOR scandal settlement is only the latest in a string of problems for UBS going back to the start of the financial crisis. In 2008, the bank paid $150M in fines for securities violations. In 2009, the bank paid a $780M fine for helping wealthy Americans evade taxes by keeping offshore bank accounts secret from the U.S. government. In the recent LIBOR scandal of course, UBS paid $1.5B for conspiring with other banks to manipulate interest rates in $350T worth of loans and derivatives.
While the investigations into all these UBS scandalswere unfolding, the bank’s employees and its political action committee (PAC) gave $11M in federal campaign contributions, according to records compiled by the Center for Responsive Politics. In 2012 the bank spent over $2M on lobbying and campaign contributions. That ranks in the top 1% of contributors.
Campaign contributions to candidates and their PACs totaled $1,534,163. Mitt Romney’s PAC was the biggest benefactor, with $398,000. Barack Obama came in second, with $112,000. About a hundred politicians received contributions with Newt Gingrich second to last with $3,750. The top 10 after Romney and Obama are as follows: Sen. Kirsten Gillibrand (D-N.Y.), $32,245; Sen. Scott Brown (R-Mass.), $27,666; Sen. Bob Corker (R-Tenn.), $23,450; Sen. Mitch McConnell (R-Ky.), $14,500; Rep. John Boehner (R-Ohio), $14,250; Sen. Robert Menendez (D-N.J.), $13,650; Sen. Clark Durant (R-Mich.), $13,500; Rep. Ed Royce (R-Calif.), $13,500; Gov. Rick Perry’s presidential campaign (R), $12,750; and Rep. Eric Cantor (R-Va.), $12,500.
Other notables include Rep. Kevin McCarthy (R-Calif), $12,500; Rep. Paul Ryan (R-Wisc.), $11,200; Sen. Orrin Hatch (R-Utah), $10,000; Rep. Darryl Issa (R-Calif.), $5,000; Rep. Ron Paul (R-Texas), $4,951; and Rep. Michelle Bachman (R-Minn.), $4,200.
Peter Papaherakles, a U.S. citizen since 1986, was born in Greece. He is AFP’s outreach director. If you would like to see AFP speakers at your rally, contact Pete at 202-544-5977.