HSBC shut down most of HSBC Finance – except for credit cards. Why? Credit-card issuers collected $22.9 billion in penalty fees such as those assessed for late payments in 2009, up from $19 billion in 2008, said Robert Hammer, who runs a credit-card consulting firm in Thousand Oaks, Calif.
HSBC payment processing has been questionable for over ten years. One must conclude HSBC earned much more than the law allowed. Complaints like “HSBC applies payment one week late” are common. (see them)
Clearly HSBC presumes predatory lending will produce more profits. Fines will be minimal compared to profits.
Will abuses end any time soon? Not likely say some analysts. Here is an example from the financial sector:
The bailout of AIG, which resulted in massive federal government monies to Goldman Sachs, was engineered at a meeting between Paulson, Geithner and Goldman CEO Lloyd Blankfein. Last year, Goldman paid top Obama economics adviser Larry Summers $135,000 for a one-day visit to Goldman Sachs.