How evil is your bank? See if your bank paid a record fine in 2012 for playing dirty

Is your bank evil? For the past several years, large banks have been engaging in a wide range of abusive and illegal practices which have cost them more than $10.7 billion in fines this year alone. Those offenses range from illegal foreclosures to laundering money for Cuba and Iran.

LOS ANGELES, CA (Catholic Online) - Big finance, from the stock market to the banks, is losing the confidence of the consumer. According to news reports on MSNBC, more Americans today are pulling their money out of the stock market than ever before. Banks are also being hit repeatedly with fines from the government and lawsuits from consumers.

What's going on in our financial sector?

One of the things that made America such a great country and an economic powerhouse, has been public accessibility to the stock market. Throughout the 20th century, and particularly in the last few decades, the public has been able to invest private capital into markets right alongside billionaires like Warren Buffet and Donald Trump.

The development of electronic trading software for personal computers and the internet has allowed billions of dollars, possibly trillions, to flow into the stock market and into banks. This infusion of capital has fueled much of the prosperity of the past few decades, a prosperity enjoyed by most, even in the face of recession.

However, some have taken liberties with the money. Bernie Madoff comes to mind, however he was not alone in his endeavors, nor was he an anomaly. Entire financial institutions have been cheating consumers and flaunting the law - and without the risk of prison.

Consider these example cases and the sometimes record-breaking fines associated with them:

-    $175 million paid by Wells Fargo to settle cases with minority homeowners who were sold subprime mortgages.

-    $210 million paid by Bank of New York Mellon for directing customers to Bernie Madoff.

-    $335 Million paid by Deutsche Bank and Flagstar for selling risky mortgages without disclosing that level of risk to buyers.

-    $1.2 billion paid by UBS for manipulating global interest rates.

-    $3.2 billion paid by HSBC, ING, and Standard Chartered for laundering money for Cuba and Iran.

-    Another $5 billion paid by banks for various violations especially associated with the subprime mortgage market.

Note that these fines are only those paid to the U.S. treasury and interests. They do not include fines paid to European regulators.

And despite the size of these fines, the banking sector raked in some $167.7 billion in profits throughout 2012. They can easily afford the fines.

The liberties go well beyond manipulating home buyers and interest rates. Loopholes and exploits associated with electronic trading also allow unscrupulous traders to take advantage of the system.

In all, Americans are being fleeced. They may not be able to articulate just why or how, but there's a feeling of gloom in the public sector that breeds mistrust of large banks and financial institutions.

The greater problem may be the overwhelming focus on fiduciary responsibility, which is to maximize profits, without a corresponding focus on ethics. Our financial institutions reward profits and investors expect ever-increasing returns. This provides incentive, even pressure, to return profits in an increasingly competitive and fast-paced market.

Perhaps instead of bonuses paid for record profits, bonuses should be paid for time without lawsuits and settlements. Taken as a whole, with $10 billion on the table, there is profit in that strategy too.

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