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Tuesday 31 July 2012

Tuesday, July 31, 2012 Posted by Jake 1 comment Labels: , , ,



Investigative economist James Henry exhaustively trawled through financial information held by the IMF, World Bank, Bank for International Settlements, central banks and national treasuries to come up with the most definitive report ever written on the super-rich and offshore wealth.

Henry’s Price of Offshore Revisited report, commissioned by Tax Justice Network (TJN), shows:
  • between $21 trillion and $32 trillion of financial assets is owned by High Net Worth Individuals in tax havens. This does not include real estate, art or jewels.
  • a conservative 3% return on that $21tn taxed at 30% would generate $189bn – a figure easily eclipsing what OECD industrialised nations spend on overseas development aid.
  • the top 50 private banks collectively managed more than $12.1tn in cross-border invested assets for private clients, including their trusts. This is up from $5.4tn in 2005.
  • fewer than 10 million members of the global super-rich have amassed a $21tn offshore fortune. Of these, less than 100,000 people worldwide own $9.8tn of wealth held offshore.
Accompanying the Price of Offshore Revisited is a separate paper [co-written by this author]. It reveals that data used by individual countries to assess the gap between rich and poor is inaccurate. And as a result, inequality is far more extreme than policymakers realise.

This is because economists calculating inequality fail to include the vast majority of offshore cash in their findings. So the wealthy are far better off than the studies suggest.

Sunday 29 July 2012

Sunday, July 29, 2012 Posted by Hari 2 comments Labels: , , , , ,
$21 trillion (£13tn) worth of assets are being 'hidden' by a global super-rich to avoid tax. The recent report by the Tax Justice Network, penned by James Henry (a former chief economist at the consultancy McKinsey), got widespread coverage. George Osborne says it’s time to put a stop to it. David Cameron says it’s time we got a slice of that cake (actually, a bigger slice than we already have). We invited Richard Murphy to explain:

By Richard Murphy

Adviser to the Tax Justice Network and the TUC on taxation and economic issues. He is also the director of Tax Research LLP.

David Cameron seems to want to turn the UK into a haven for tax avoiders. At least we now know where we stand. In wooing French tax exiles, Cameron makes a mockery of democracy.

He promised to 'roll out the red carpet' to French businesses while attending the G20 summit in Mexico, saying in June 2012,
"If the French go ahead with a 75% top rate of tax we will roll out the red carpet and welcome more French businesses to Britain and they will pay taxes in Britain and that will pay for our health service, and our schools and everything else."
But hang on a minute. His chancellor said in March, "I regard tax evasion and indeed aggressive tax avoidance as morally repugnant". What's more, George Osborne pronounced himself "shocked" at the amount of tax avoidance in the UK. And yet, here's his boss saying the door's open to all and sundry French tax avoiders who want to set up camp in the UK.

Tax avoidance
As for the businesses these tax exiles own, let me assure Cameron that they will stay put in France, because that's where their markets are and in the days of the internet the business owner does not have to live over the shop – something Cameron and Osborne have not yet noticed. So we won't win there. And that's inevitable – look at the world's tax havens and you'll see that nothing but the pretence of money shuffling occurs in those places.

As a result Cameron's words are on this occasion, as on so many others, literally meaningless. In that case it is what Cameron's words imply that matters. Let me note a few more of them in that case:


Thursday 26 July 2012

Thursday, July 26, 2012 Posted by Jake No comments Labels:
$21trillion (£13tn) worth of assets 'hidden' by tax dodging global super-rich 
A global super-rich elite had at least $21 trillion hidden in secret tax havens by the end of 2010, according to a major study by a former chief economist at the consultancy McKinsey. BBC NEWS
(Taxmen around the world want to know where it's hidden - and so do some former spouses)

UK economy on its knees as shock growth figures show disastrous 0.7% plunge in output
Figures fuel criticism that Chancellor George Osborne's austerity measures are choking off the recovery. The UK's economy is 0.3 per cent smaller than when the coalition came to power in the second quarter of 2010 DAILY MAIL
(We can't afford to see another job lost. Well, maybe one, Mr Osborne)

Four in ten Britons will cut back on food
In the coming months four in ten Britons will be forced to cut their food budget as households experience the tightest squeeze in living standards since the 1920s, says Which? TELEGRAPH

Payday lenders agree new rules, but they are only voluntary
Four trade bodies - representing 90% of the lenders - have committed to make fees and charges clearer and to give more protection to those in difficulty. But the rules are only voluntary, and one consumer group has described the new code as merely rebranding. BBC NEWS
(Meanwhile in some wonderful parallel universe somewhere they've made the repayment of gouging loans voluntary too.)

Tuesday 24 July 2012

By Ann Pettifor 
Fellow of the New Economics Foundation.

[Click here to sign the e-Petition.]

Power corrupts, and financial market power has corrupted financial and other markets. It has done worse. It has corrupted politics. That is why Britain will be ripped off by a Parliamentary Inquiry into banking. It will go nowhere, lack both credibility and teeth, and will inevitably be discredited. Above all, it is most unlikely to rein in bankers.

That is why we launched our  e-Petition the very day the Barclays LIBOR scandal broke on 27th June, and why we are still calling on Britons (and all UK residents) to sign this Peoples’ Petition here for a full Judicial Inquiry into...  

“the fraud, wrongdoing and ethics of British banks, their management and their staff, and the role of the British Bankers Association. The terms of reference of this inquiry should also include the manipulation of interest rates on about £225 trillion of assets. The inquiry must have full powers to compel witnesses to appear on oath, and to obtain all forms of evidence.”

Within a few days, over 10,000 had already signed the petition, and very soon others – including Ed Miliband and the Labour Party – joined in the call. 

Monday 23 July 2012

Monday, July 23, 2012 Posted by Hari No comments Labels: , , ,
Chris should be proud of another world beating British bank

Sunday 22 July 2012

Sunday, July 22, 2012 Posted by Jake 4 comments Labels: , , , , , ,
The summer of 2011 saw the London riots in full view of local, national, and closed circuit television. Heedless of their audience ordinary Britons smashed and grabbed. Over the ensuing months thousands of convictions and punishments were handed out to citizens who had never faced a magistrate before and will probably never do so again. It takes an extreme hooligan to kick in a shop window. But once the window has been kicked in, it seems there are thousands of us who would step through and snatch stuff.


Corporate Britain saw the windows kicked in back in the 1980s when financial services were de-regulated. We quickly saw what well bred city gents turn into when nanny isn’t around. Bankers and traders leading the scramble for loot were followed over the years by the other professions. Some dashed through immediately while others waited a decade or so to see if anything would be done to stop the looting. Eventually, finding that lawmakers, regulators and public opinion were indolent and impotent, they too stepped over the line. Financial Services were joined in the looting by Energy, Insurance, Transport, Telecommunications and others. It wasn’t just the direct looting of us ripped-off Britons individually. The looters stepped into public services. Defence procurement, IT projects, the outsourcing to the private sector of policing, health, education and infrastructure build. The looting continued through decades of Conservative and Labour governments. Successive politicians, many of whom grew mightily wealthy, have a simple question to answer:

Please Tick:     Were you a Fool or a Knave?
            _            Fool
            _            Knave
            _            Fool and Knave

The ‘Big Bang’of 1986 was the sound of kicked glass shattering, and the echoes continue to reverberate today.

Like rioters in a court, the summer months of 2012 exposed a great deal about corporate culture.
Dies mirabilis, the British Bankers Association, arch apologist and denier, cancelled its 2012 summer party having recognised that our industry needs to think long and hard about its collective behaviour. Deprived of their Pimms and champagne the bankers skulked off to collect their thoughts over stronger stuff in their boardrooms.

Much was exposed, but was anything learned? The following exchange between the MP Jesse Norman and Bob Diamond, when Diamond was giving evidence to the Treasury Committee, suggests not:

Thursday 19 July 2012

Thursday, July 19, 2012 Posted by Jake No comments Labels:
NHS pays £1,600 a day for nurses as agency use soars to cope with rising staff shortages
Experts said the disclosures show how hospitals' attempts to improve their efficiency have backfired. Jobs are being cut, only for temporary staff to be hired at vastly inflated rates - with private agencies receiving more than seven times the rate paid to nurses on the pay roll. TELEGRAPH

Miliband slams pension fees 'rip-off'

At present, some people are paying up to 4% or 5% in fees and charges on their pension schemes, which could swallow up as much as £50,000 of every £100,000 they pay in over the course of their working life, he said. INDEPENDENT
("We decided to do nothing about this during our 13 years in government, and then bring it up in opposition. Genius!" he didn't say)

Was the petrol price rigged too?

Motorists may have been paying too much for their petrol because traders may have manipulated oil prices in the same way they rigged LIBOR interest rates. TELEGRAPH
("What else do you expect us to do in our lunch breaks?" said a LIBOR trader)

Labour attacks lettings agencies who 'rip off' landlords and tenants

Labour will look at how to cap rising rents in the private sector, said Hilary Benn, the shadow secretary of state for communities and local government. He also admitted that Labour made a mistake in office by not building enough "social homes", thereby creating problems for the current housing market. GUARDIAN

Wednesday 18 July 2012

Wednesday, July 18, 2012 Posted by Hari No comments Labels: , , , , ,
KJ sticks to the oldest sales trick in the book...

Saturday 14 July 2012

Saturday, July 14, 2012 Posted by Jake 2 comments Labels: , ,
Having explained how 'interest rate swaps' work in a previous post, we asked Honestly Banking to explain why they were sold.


The best fairytales are not just empty whimsies. The best ones seek to educate us about the hazards of greed, gluttony, pride, lust and all the other stuff we’d really like to do but probably oughtn’t. The Bully-Banks guest post on this blog compared their ripped-off situation to Little Red Riding Hood in the clutches of the wolf. Their situation also brought to our mind another salutary fairytale: Rumpelstiltskin. 


In the Rumpelstiltskin story a king decided the way to save his finances was to put the burden on a young girl, threatening her with death unless she turned straw into gold. The desperate girl takes a deal from a malevolent demon that provided her with gold for the king but as part of the deal she must give him her firstborn child. The demon guessed the unsophisticated girl, needing to avoid impending death, would not appreciate what she had promised. The trouble started when the demon came to collect.

In Ripped-Off Britain the government decided the way to save its finances was to put the burden on small and medium businesses (which make up 60% of the private sector), to turn the recession back into growth and employ all those sacked public sector workers. The desperate businesses took deals from malevolent bankers who provided them with the gold, but as part of the deal required the businesses to sign an “interest rate swap agreement”. The bankers guessed the unsophisticated businesses, needing to avoid impending ruin, would not appreciate what they had promised. The trouble started when the banks came to collect.

The demon gives the girl a chance to get out of the deal if she can discover his name. The FSA has given the businesses a chance to get out of the deal if they can explain the scam and get public opinion on their side.

Explaining the scam is not as easy as it sounds. Even Ed Miliband, leader of the Labour Party, with two degrees in economics (Oxford University & London School of Economics) conceded he didn’t understand it. In a Sky report, Ed said:
"I visited a guy called Alan who runs a signage company in Putney. He was in tears. It's a chilling story about what the banks are doing to people.
He has lost about a £1m because of the banks. He got sold a 'dual interest rate swap'. I have a master’s degree in economics and I can’t understand it."
The only person who knew Rumplestiltskin’s name was the scamp himself. Perhaps the only people who understand Interest Rates Swaps are bankers. So we asked a banker, our occasional guest blogger from Honestly Banking to explain a bit more how and why banks managed to get businesses to take this product. He responded thus:

Interest Rate Hedges fall basically into two categories; Swaps that effectively fix a rate and Caps that give you a ‘no higher than’ rate. All the other structures, such as collars are generally methods of hiding premiums and increasing bank profits.

When these structures are priced and sold the bank will make use of the ‘Yield Curve’, which shows the market’s expectation of future interest rates. If the curve is dropping away in the future, i.e. the market expects interest rates to fall, the bank makes more profit with a longer-term hedge that keeps the interest rate they receive up when market rates fall. Interpreting Yield Curves is fraught with danger. An example yield curve is given below.

Friday 13 July 2012

Friday, July 13, 2012 Posted by Hari No comments Labels: ,
Chris, Fee and KJ find a silver lining to having G4S involved in the Olympic Games

Thursday 12 July 2012

Thursday, July 12, 2012 Posted by Jake No comments Labels:
 

SHOCK NEWS! British Bankers Association summer party is cancelled!!!!!
Their statement said “We regret the short notice but our industry needs to think long and hard about its collective behaviour” BLOOMBERG 
Original details were:
Date & Time: 4th July 2012, 18:30 - 20:30
Venue: College Garden, Westminster Abbey, London, SW1P 3PA
Dress Code: Business Wear
(They forgot to add... Ethical Code: Optional)


UK Government departments cut spending by £6.7bn more than they had planned in the year to March
The government cut 270,000 public sector jobs last year. Some of those have been replaced by new jobs in the private sector but not enough to make a significant impact on high unemployment levels. BBC NEWS


One in six Lords have paid links to financial services industry

Research shows bankers and financiers hold many seats on key committees scrutinising the City. GUARDIAN and BUREAU OF INVESTIGATIVE JOURNALISM
("On the 10th day of Christmas my truelove sent to me... One-in-six Lords a-leaping with fistfuls of banker moolah...")


Revealed: why Gordon Brown sold Britain's gold at a knock-down price
Facing a global collapse in the banking system, the Chancellor bailed out the banks by dumping Britain’s gold, forcing the price down and allowing the banks to buy back gold at a profit, thus meeting their borrowing obligations. TELEGRAPH

Tuesday 10 July 2012

Tuesday, July 10, 2012 Posted by Hari No comments Labels: , , , ,
Chris, Fee and KJ on the consequences of House of Lords reform

Monday 9 July 2012

Monday, July 09, 2012 Posted by Jake 3 comments Labels: , ,
The wriggling and wiggling of UK political and regulatory authorities trying to avoid taking criminal action against individual bankers for LIBOR rate fixing was just more of the same. The latest excuses and obfuscations by those who should be protecting us but would rather protect the bankers included:
Ripped-off Britons: Cern and the city

  • The Serious Fraud Office (SFO) does have the power, but is too useless. [We shall see]
The FSA has an uniquely abysmal record on regulation and enforcement. FSA fines are a miniscule tiny fraction of bank profits, making them nothing more than a cost to the banks of doing business as usual – like paying their electricity bills. In any case the fines imposed by the FSA are used to subsidise the fees paid by the banks to the FSA – the fines are effectively recycled back to the perpetrators. 


Angst at being held in contempt even in comparison to the FSA eventually brought out the lion in the SFO. Having said on the 2nd July 2012 they were


they managed to come to their conclusion much quicker, in just four days, issuing a single sentence press release on 6th July 2012:


The humiliation of not pursuing this would have been too much for the SFO in circumstances where:
a)      Barclays had admitted its fault, paid its fine, ejected its CEO & COO, and has its Chairman’s resignation.
b)      The US Department of Justice had collected the evidence on Barclays and a slew of other leading banks
c)      The Fraud Act 2006 left little doubt that the law to prosecute was in the statute books and waiting to be thrown.

In fact, so precisely relevant is Chapter 35 Sections 1 to 6 of the Fraud Act that it could be the basis of a job description for a bank trader – see the addendum to this post for details.

The battle is not yet over. Politicians and regulators do not really want to have to travel to one of the bleak open prisons to visit their Best Forever Friends. They have a record of doing what is necessary behind the scenes to avoid this inconvenience. And the SFO’s tentative little roar may yet turn into the usual mewling and puking one expects when it comes to regulators versus the Financial Services Industry.

To understand whether this case deserves criminal prosecution, some insight is provided in Bob Diamond’s letter to Barclays staff just before he decided to resign in July 2012:

“It is important to bear in mind that this behaviour stopped nearly three years ago. The documents released last week represent part of an industry-wide investigation and are the result of investigations which we carried out in cooperation with three different regulatory Authorities over three years.”

a)      Diamond himself was in charge of the “behaviour” three years ago, and many years prior to that.
b)      He states that the investigation with “three different regulatory Authorities” started three years ago, when the “behaviour” stopped.
c)      You may call senior bankers many things, but ‘stupid’ is not one of them. Even a stupid burglar would work out that if the cops are investigating him on suspicion of burglary it would be a good idea to cease the burglarising.

Sunday 8 July 2012

Sunday, July 08, 2012 Posted by Jake 7 comments Labels: , , ,

UPDATE NOV 2016: Royal Bank of Scotland agreed to set aside £400m to compensate up to 12,000 small business customers that it “allegedly mistreated” in the wake of the financial crisis. Leaked RBS documents confirm that their "Project Dash for Cash" incentivised staff to search for companies that could be restructured and have their assets sold off, or have their interest rates bumped up. The documents also show that where business customers had not defaulted on their loans, bank staff could find a way to "provoke a default". In 2014 RBS said the department responsible, the Global Restructuring Group, was not there to make a profit. Weeks later, as the scandal was exposed, the then RBS chairman Sir Philip Hampton was forced to admit that it was.

The author of this guest post is a member of Bully-Banks, an alliance of small and medium businesses that were victims of the Interest Rate Swaps scandal that has ruined many UK businesses.
Imagine a situation of Little Red Riding Hood discovering she had been rescued by the woodman only to then be put into the custody of the Big Bad Wolf! That’s how the thousands of small businesses like me feel after the announcement by the Financial Services Authority (FSA) on the mis-selling of Interest Rate Swap Agreements (IRSA’s)

The FSA for the first time recognised that the banks had been ripping off small businesses and we, like everyone other than the banks, celebrated. Somehow an injustice was recognised and was going to be put right, so we thought. The FSA’s announcement stated:

"Our review has found serious failings in the sale of interest rate hedging products to small and medium sized businesses (SMEs). We have evidence which raises concerns about the sales we have reviewed in certain banks. These concerns include
(i)           inappropriate sales of more complex varieties of interest rate hedging products (such as structured collars) and
(ii)         a number of poor sales practices used in selling other interest rate hedging products.
(iii)       We also found that sales rewards and incentive schemes could have exacerbated the risk of poor sales practice."

It went on to say:

"In order to provide a swift solution for customers, we have reached agreement with Barclays Bank Plc (“Barclays”), HSBC Bank Plc (“HSBC”), Lloyds Banking Group (“Lloyds”) and The  Royal Bank of Scotland Plc and National Westminster Bank Plc (collectively “RBS”) banks to provide appropriate redress where mis-selling has occurred. We have agreed with Barclays, HSBC, Lloyds and RBS that they will: 
(i)           provide fair and reasonable redress to non-sophisticated customers who were sold structured collars;
(ii)         review sales of other interest rate hedging products (except caps or structured collars) for non-sophisticated customers; and
(iii)       (iii)  review the sale of caps if a complaint is made by a non-sophisticated customer during the review.

The exercise for each bank will be scrutinised by an independent reviewer and overseen by the FSA."

The banks however are not that stupid. We now face a reality that we won the war, but are in danger of losing the peace. Worrying words in the FSA judgement are:

a)      It only covers “non-sophisticated customers”. The FSA defines as financially "sophisticated" a customer who met at least two of the following:
(i)         a turnover of more than £6.5 million; or
(ii)        a balance sheet total of more than £3.26 million; or
(iii)       more than 50 employees.
b)      “independent reviewer” – The proposed use of major firms of accountants to act as ‘independent’ adjudicators is fundamentally flawed. Each of them has significant commercial relationships with the banks and have previously been used by the banks to close down or put into administration  businesses damaged by the mis-selling of IRSAs.

Do you know of any other situation where someone is robbed and then the system which is supposed to look after you appoints the criminals to resolve your dispute?

Friday 6 July 2012

Friday, July 06, 2012 Posted by Hari 1 comment Labels: , , , ,
Chris and a banker chum discuss a new experiment for the Higgs Boson detector...

Thursday 5 July 2012

Thursday, July 05, 2012 Posted by Hari 5 comments Labels: , , , , , , ,

Riposte: an occasional series that responds to the comments posted by those who don’t like what we’re saying.

Riposte arms readers with the facts and the references. Never again find yourself stumped because someone’s one or two facts trump your better instincts.

Inevitably, some of the questions overlap. We apologise for any repetition in the answers.

Here are the comments...
  • “Banks pay £55bn in taxes. We’ll lose that if the banks leave the UK!”
  • “Regulation will shrink the banking sector, losing jobs and tax revenue. What will replace it?”
  •  “A lot of other sectors depend on banking: legal services, consulting, and all those shops and restaurants in the city. They will suffer too.”
  • “The UK earns £40bn in foreign exchange from overseas. If banks leave, we’ll lose that. The costs of squeezing the banks outweigh the benefits.”
  • “Regulation won’t work. The banks will always find ways around it.”
  • “The banks were de-regulated in the 1980s, but there were big banking crises before then when regulation was stiffer. So regulation won’t stop banking crises.”
  • “Stiffer regulation means we lose our place as the global leader in banking.”

Here are the answers...

Q. Banks pay £55bn in taxes. We’ll lose that if the banks leave the UK!


We’ll only lose £3bn.

That £55bn figure for 2009-2010 includes corporation tax (£6bn), payroll taxes (£25bn), other business taxes like VAT and rates (£11bn), other taxes like stamp duty and interest rate tax (£13bn). In April 2011 the Independent Commission on Banking predicted just £3bn in taxes will be lost if banks relocate. Most UK banking activity makes its money from the UK domestic market, so only some banking activities can actually leave, which means most of the money the UK gets in taxes will remain here.

Thursday, July 05, 2012 Posted by Jake No comments Labels:
GlaxoSmithKline to pay $3bn in US drug fraud scandal
"The sales force bribed physicians to prescribe GSK products using every imaginable form of high-priced entertainment, from Hawaiian vacations [and] paying doctors millions of dollars to go on speaking tours, to tickets to Madonna concerts," said US attorney Carmin Ortiz. BBC

Barclays claim Chief Operating Officer misunderstood CEO's interpretation of a conversation with Deputy Governor of Bank of England allegedly giving them permission to rig LIBOR rates.
COO then passed on those instructions to staff. PRESS ASSOCIATION

Libor scandal: How I manipulated the bank borrowing rate
An anonymous insider from one of Britain's biggest lenders – aside from Barclays – explains how he and his colleagues helped manipulate the UK's bank borrowing rate. Neither the insider nor the bank can be identified for legal reasons. TELEGRAPH


Bank of England's money printing blamed for pensions 'meltdown' as annuity payouts dive 27% in four years

Tom McPhail, head of pensions research at Hargreaves Lansdown stockbrokers, said the UK's pension annuity rates have been in ‘meltdown’ for the past four years. DAILY MAIL

Tuesday 3 July 2012

Tuesday, July 03, 2012 Posted by Hari No comments Labels: , , , , ,
Bob Diamond's Barclays and the other big banks were rigging LIBOR interest rates? Jail the CEOs!

Sunday 1 July 2012

Sunday, July 01, 2012 Posted by Jake 4 comments Labels: , , ,
The banking scandals of June 2012 were shocking. In spite of a consistent record of financial services rip-offs (PPI; excessive overdraft charges; excessive investment charges; pension annuity rip-offs;…) two FSA judgements confirmed how low banks were prepared to go to turn a profit remain shocking.


Equally stunning, certainly to its customers and its customers own customers and business partners, was the crippling of the Royal Bank of Scotland’s banking business for over a week caused by the failure to invest in its IT.

However, hidden among all the shocks was a huge revelation which risks going unnoticed. A revelation far more important than the rip-offs themselves. 

It is a revelation that shines a light on why these people who run the banks have their consistent record of rip-offs in the first place. It starts to explain why intelligent people with families, many of them with children and pets that love them, are prepared to rip off and consign to financial distress and ruin their fellow humans. And it’s not just for the money!

As penance for these mishaps Bob Diamond (CEO of Barclays) and Stephen Hester (CEO of RBS) have said they would not take bonuses this year. They rejected calls for their resignations and proposed no further sanction for their failures. [update 3rd July 2012: Diamond has resigned, stating as his reason: "The external pressure placed on Barclays has reached a level that risks damaging the franchise – I cannot let that happen". External pressure, not pressure from the board, nor the pressure of his own conscience?]  And herein lies the great revelation.

In all the storm and stress of what in any other industry would be desk-clearing defenestrating events there is an eye-opening insight here into the thinking of bank bosses. With Diamond and Hester’s response to their, or should that be our, misfortunes we get an insight into what bank bosses see their basic jobs to be, and what earns them their bonuses. 

“Bonus” is a reward for excellence. For doing more than your job requires. Evidently Diamond believes that it was beyond his normal duties to prevent his bank indulging in activities described by the FSA as:

“Barclays’ misconduct was serious, widespread and extended over a number of years….[its] behaviour threatened the integrity of the rates with the risk of serious harm to other market participants.”

Barclays not lying, Diamond presumably believes, is him ‘going that extra mile’ deserving of a bonus. Lying is therefore presumably just basic business as usual, deserving of his basic pay and perquisites. 

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