ECB Hires ex-Goldman Banker And Vatican Auditor As Watchdog

As one Goldmanite departs (i.e., Mario Draghi, whose term ends on October 31) another Goldmanite arrives at the ECB.

Now that Christine Lagarde (who had her share of run-ins with the French law especially her guilty conviction in 2016 over a €400MM payment to Bernard Tapie) has been picked to head Europe's central bank, the European Central Bank has hired Elizabeth McCaul, a former Goldman Sachs banker who later led an audit of the Vatican’s scandal-ridden bank, as one of its top banking supervisors, the bank said last week.

She is one of three new ECB representatives on the Single Supervisory Board, which oversees the euro zone’s 114 largest banks according to Reuters.

McCaul will join the ECB from Promontory Financial Group, a prominent US consultancy firm - famous Wall Street "revolving door" which sends financial execs into positions of power - which agreed to pay $15 million to New York’s banking regulator in 2015 to settle accusations of whitewashing a report on Standard Chartered Bank

Even more curious is that during her stint at Promontory, now owned by IBM, McCaul helped audit the Vatican’s bank during a clean-up ordered by Pope Francis in 2013 and also did consultancy work for the ECB during the set-up of the Single Supervisory Mechanism. Before that, McCaul was Superintendent of Banks for the State of New York, having joined that department after a decade as a banker at Goldman Sachs.

And yes - there's more - a mother of seven, McCaul is married to former Goldman Sachs partner Frank Ingrassia, who used to head the bank's municipal finance group.

She will be joined on the Single Supervisory Board by Edouard Fernandez-Bollo, who currently works for the French banking watchdog, and Kerstin af Jochnick, until Thursday the first deputy governor of the Swedish central bank.

In other words, all the people who are directly and indirectly invested in perpetuating the status quo which has failed to result in any tangible change for the past decade, will be in charge of making sure that Lagarde gets the precisely right advice - from Goldman and others - to not threaten the perpetuation of what has worked only for the ultra wealthy for the foreseeable future.