The €335 Billion European Heist: How Banking Cartels Across Europe Extract Wealth from 450 Million Citizens

Following my exposé of the UK's £105 billion GEMM scam, let's lift the lid on the even bigger racket operating across the European Union

European taxpayers paid €335 billion in interest payments in 2024 - a staggering 15.6% increase in just one year. That's €745 for every man, woman and child in the EU. But where does this money go? And why does a monetary union with its own central bank need to pay private banks hundreds of billions in interest?

The answer exposes one of the greatest financial scams in history.

The Same Scam, 27 Times Over

Just as the UK has its 18 GEMMs (Gilt-Edged Market Makers), nearly all EU countries have their own exclusive club of "Primary Dealers" - banks with monopoly rights to buy government bonds at auction:

• France: 15 Spécialistes en Valeurs du Trésor (SVTs)
• Germany: 25 members of the Bund Issues Auction Group
• Italy: 16 Primary Dealers for Italian government bonds
• Spain: 21 Market Makers and 6 Primary Dealers
• Netherlands: 14 Primary Dealers

These aren't local banks serving their communities. The same names appear again and again: Goldman Sachs, JP Morgan, Deutsche Bank, BNP Paribas, Barclays, Société Générale. It's a transnational banking cartel with exclusive access to create money for governments.

The Zero Risk Weight Scam Goes European

Under Article 114(4) of the EU Capital Requirements Regulation (CRR), ALL European government bonds carry a 0% risk weight when held by banks in their domestic currency. This completely overrides the Basel Banking regulations that would normally require capital based on actual risk. This means:

• Greek government bonds (rated BBB) - 0% risk weight
• Italian government bonds (rated BBB) - 0% risk weight
• German government bonds (rated AAA) - 0% risk weight

All treated identically despite vastly different default risks!

The Perverse Incentive

Here's where it gets truly insane. Since Greek and Italian bonds pay HIGHER interest rates (to compensate for their higher risk), banks actually have an incentive to:

1. Create money from nothing (remember: 0% capital requirement)
2. Buy the riskiest EU government bonds for maximum yield
3. Collect higher interest from taxpayers in struggling countries
4. Face zero regulatory penalty for loading up on risky debt

A German or French bank can create unlimited euros to buy Greek debt paying 3.4% interest instead of German debt paying 2.7%. More risk, more reward, but still zero capital required!

The Double Standard

When normal citizens or pension funds buy government bonds, they must use real money - savings they've earned and accumulated. When they buy Greek bonds, they take real risk with their real money.

But when banks buy the same bonds:

• They can create the money from thin air - as they do when making standard loans
• They need no capital to back it
• They face no regulatory constraint on how much they buy
• They collect billions in interest from taxpayers

A French bank can create €10 billion from nothing to buy Italian or Greek debt, still at 0% risk weight, and collect hundreds of millions annually in interest.

Follow the €335 Billion

Where do European taxpayers' interest payments actually go?

Based on patterns similar to the UK:

• €100-130 billion likely goes to foreign investors - pension funds in the US, Canada, Asia, and sovereign wealth funds
• €70-90 billion to European insurance companies and pension funds - predominantly benefiting wealthy retirees with private pensions
• €60-80 billion to the banking sector - the very banks that created the money from nothing
• The remainder to various European institutional investors

Just as British taxpayers fund American and Canadian retirements, European taxpayers are doing the same on a massive scale.

The Great Lie of "Market Discipline"

European politicians constantly invoke "the markets" to justify austerity. "The markets demand fiscal discipline!" "We must satisfy the bond markets!" But what markets?

When the "market" consists of banks that can:

1. Create unlimited money to buy bonds (zero risk weight = no capital constraint)
2. Never have to sell (they can hold to maturity and collect interest forever)
3. Face zero risk (government bonds in their own currency can't default)

Where exactly is the market discipline?

The ECB's Fake Constraint

"But the ECB can't lend directly to governments!" cry the defenders of this system. "It's Article 123 of the Lisbon Treaty!"

True. But this "constraint" is a deliberate choice to force governments to borrow from private banks who create the money anyway. It's like saying "I can't walk through this door" while ignoring the identical door right next to it marked "Private Banks Welcome." 

The ECB proved during the pandemic and sovereign debt crisis that it can buy unlimited government bonds on secondary markets. The money creation happens either way - the only question is who profits.

The Democracy That Never Was

No European citizen ever voted for this system. No referendum ever asked: "Should we let private banks create money from nothing and charge taxpayers €335 billion annually in interest?"

Yet whether you vote for socialists in Spain, conservatives in Germany, or populists in Italy, this system remains untouchable. The banking cartel's right to create money and collect interest transcends all democratic choice.

The Solution: People's Banks in Every Nation

Here's the beautiful irony: while the ECB cannot lend directly to governments, there's nothing stopping EU countries from creating public banks that can. A People's Bank in each country could:

1. Be capitalized by the government (as many public banks already are)
2. Participate in government bond auctions (no rule prevents this)
3. Create money to buy government bonds (just like private banks do now)
4. Return all interest payments to citizens (instead of private shareholders)

This isn't radical - it's exactly what private banks do now, just with public ownership.

What Could Europe Do with €335 Billion Annually?

Instead of enriching global bondholders and banking cartels, €335 billion could:

• End homelessness across Europe (estimated cost: €20 billion)
• Provide free university education for every European student
• Build a genuine green energy infrastructure
• Establish universal childcare across the continent
• Give every EU household €2,000 per year

The National Breakdown of the Scam

Let's look at some specific countries:

France pays approximately €50 billion annually in interest:

• €15-20 billion likely leaves the country
• €10-15 billion to French banks that created the money from nothing
• French taxpayers funding foreign retirements while their own services are cut

Italy pays approximately €65 billion annually:

• Despite having its own currency before the Euro, now trapped in a system where Italian banks create money that Italian taxpayers must pay interest on

Germany pays approximately €40 billion annually:

• Even the "fiscally responsible" Germans are caught in this trap
• German banks profit while German citizens are told to tighten their belts

Breaking the Cartel

The solution doesn't require treaty changes or ECB reform. Each country can:

1. Create a national People's Bank tomorrow
2. Have it participate in bond auctions alongside private banks
3. Gradually replace private debt with public debt where interest returns to citizens
4. End the €335 billion annual extraction

The private banking cartel maintains its monopoly only because politicians lack the courage to challenge it. The moment one country shows it can be done, the whole edifice crumbles.

The Ultimate Irony

The European Union was sold as bringing prosperity to its citizens. Instead, it has created the perfect mechanism for extracting wealth from 450 million Europeans for the benefit of:

• Global financial elites
• Foreign pension funds
• A transnational banking cartel

The very banks that caused the 2008 financial crisis, required massive taxpayer bailouts, and destroyed millions of lives, now collect €335 billion annually from European taxpayers for creating money from thin air.

Conclusion: End the European Debt Scam

The UK's £105 billion GEMM scam is replicated and amplified across Europe. €335 billion annually - and rising 15.6% in a single year - flows from European taxpayers to banks and bondholders who did nothing to earn it except create digits on a computer.

This isn't about left or right, North or South, fiscal hawks or doves. This is about ending a system where private banks have captured the money creation power of democratic states and use it to extract tribute from citizens.

Every European should be asking their representatives:

1. Why do private banks have monopoly rights to create our money?
2. Why do we pay €335 billion in interest on money created from nothing?
3. Why don't we create People's Banks to keep this money in public hands?

Until these questions are answered, European democracy remains a facade behind which banking cartels extract wealth from citizens with perfect efficiency and zero risk.

The scam ends when citizens understand it and demand change.

€335 billion annually. 15.6% increase in one year. Zero risk for banks. Maximum extraction from taxpayers.

This is not economics. This is theft.

---

Sources: European Central Bank, Eurostat, National Debt Management Offices of EU Member States, 2024 data