Fresh off setting a record with the Department of Justice, CitiGroup Chief Executive Officer Michael Corbat is looking to set another record.
The record? No, not the amount of the fine. The fact that no individual bank executive was prosecuted when fraud was all around is an amazing achievement, a show of power that the 1 percent really are in control.
But the record Corbat might want to break has nothing to do with control of the levers of government power to the firm’s benefit. It has everything to do with raising money for charity.
CitiGroup’sCorbat charity auction
The charity the big bank receives from big government is not what were talking about. Corbat is auctioning himself off to the highest bidder to benefit BYKids, a nonprofit that teaches young people about documentary-making, the Journal reports. The event, auctioned by website Charitybuzz.com, provides the “winner” an opportunity to meet with Corbat and discuss the world according to Michael.
According to a recent Wall Street Journal report, Corbat will action access for a meal with the executive and potentially his wife to discuss “a few of his favorite topics.” The article goes on to list the topics: banking, the economy, globalism, fly fishing and skiing.
It is unknown if some real questions might be asked at lunch that matter.
“Michael, so tell me,” a real dialogue might ensue. “Can you detail your notional directional risk exposure in credit default exposure? When sovereign nations start defaulting or interest rates rise dramatically in a short period – a move being considered by top quantitative minds – how does the notional risk model look?”
Perhaps for that conversation the appropriate partner might be a qualified risk manager. Perhaps Ken Griffin’s wife might be available?
Another conversation might uncover the real value the banks enjoy in their mastership of the levers of government’s favorite protection racket. “When you sell CDS insurance to those seeking protection, can you detail the method you wink and nod to clients when they ask about risk backstops? How would you compete with smaller brokerage firms and banks if you didn’t have this risk underwriter?”
But then perhaps the biggest question might be about government influence. “Can you talk about the risk reward profile your investments in government lobbying and control of the media discussion yields?”
This is the real secret of the big banks. These are questions that likely won’t be asked, but should be.
Bidding on the event closes today who we may soon know who is the lucky “winner” of the auction.