This buried headline in today's Vancouver Province could well be the most important story of the year. The European Union loses some $800 million to suspected fraud every year and it will consider setting up an office to combat it, a senior official said Tuesday.
This is relevant because that is a huge drain on the system. It is also relevant because the Greek financial crisis was the result of investment fraud. That massive fraud was hidden by Goldman Sachs who ripped off the EU of that massive bailout.
Allegations against Goldman Sachs highlight the pressing need to break up big banks and introduce strict financial regulation. Deregulation opens the flood gates wide open to investment fraud.
When you consider that the administrative budget for the EU for 2011 was 268.4 billion Euros (352.82 billion CAD), losses to fraud at $800 million is really just a drop in the bucket. Entitlements and corporate welfare are the real culprits. When the population becomes accustomed to early retirement on the government tit, and the top earners are barely or if all taxed, there are going to be problems down the road.
ReplyDeleteNot that I'm opposed to stricter regulation of banking. I just figured I'd point out where the real problem is.