There is something profoundly rotten in the World banking system. The Lehman disaster offers us yet another view of it.

The top-ranking British law practice Linklaters signed off on controversial accounting practices that let Lehman Brothers shift billions of dollars of debt off its balance sheet. This masked the perilous state of the bank’s finances, and for many years misled both investors and regulators.

As legal reporting periods loomed, Lehman would enter an arrangement to sell and then buy back financial assets. Such deals should be listed in the accounts as ‘transactions’. However, by illegally introducing a cash element, Lehman was allowed to report these as “sales”. (The Slogger can confirm that a leading UK advertising agency in the 1980s used precisely the same trick. It remains undiscovered and unpunished to this day; and the perpetrator remains rich and retired, having swindled City investors out of huge amounts of falsely attracted investment monies).

Not only has crooked dealing been a clear and present carbuncle on the City’s reputation for decades, ancillary professional concerns have long been up to their necks in illegal collusion in such activities.

It’s not as if we’re talking about maverick renegades here: Linklaters belongs to Britain’s inner elite of law outfits, along with Allen & Overy, Clifford Chance, Freshfields Bruckhaus Deringer, and Slaughter and May. The practice is in the global Top Twenty rankings.

Time and again, accusations of wrongdoing are met with appalled sanctimony by those routinely involved in serious misdeeds….only to result in even worse revelations followed by convictions. And equally, the sentences handed out to miscreants justifiably evoke cries of ‘one law for the rich and another for the poor’.

When I suggested in a 2007 edition of the magazine Market Leader that robust Lehman results hid an overdependence on merger and acquisition business, I did not for a second suspect wrongdoing – only myopia. But I can promise you, no editor has ever received such a level of vitriol from Lehmans and others in the sector – coupled with bullying threats of legal action, and accusations of dangerous naivety on my part. How the Mighty are fallen.

Maybe I remain a naif, but I am coming to the conclusion that the lack of political will to deal with widespread nefarious behaviour by top bankers (and the obvious unwillingness of that profession to even give greed a low profile, let alone change its ways) is going to produce a backlash of unimagined proportions from citizenries around the world.

This will not be based on any high-minded rejection of hopelessly corrupt people. More threateningly, it will be based on raw, vicious revenge. Be the avengers ordinary Greek investors stitched up by Goldman Sachs, or former Lehman employees rendered jobless by management hubris and JP Morgan, viral electronic barricades of one form or another will emerge with (I suspect) very little warning – and absolutely no mercy.

Major Western democratic States will see no alternative beyond redeploying their already overworked law enforcement officers to focus on containing the revenge. And in such scenarios, both liberty and democracy will be under threat.

Only two groups will be to blame: sociopathic financiers and blind-eye turning legislators. They will deserve almost whatever punishment they receive.