Tag Archives: TBTF

Another Oligarch Wrist Slap: Citigroup Settles in Secret on Housing Fraud Charges

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Guess what just happened?  In case you forgot, the Federal Housing Finance Agency (FHFA) had previously accused Citigroup of violating securities laws and making misrepresentations of billions of mortgage bonds.  Unsurprisingly, Citigroup settled, which is just a euphemism for an “oligarch wrist slap.” What’s really disturbing is that the settlement amount will remain a secret, which takes cronyism to yet another despicable level.  After all, take a look at the man who runs the Treasury Department.  From Bloomberg:

The conservator for Fannie Mae and Freddie Mac was eager for publicity in September 2011 when it sued 17 financial institutions, accusing them of ripping off the two government-backed housing financiers. It isn’t so enthusiastic anymore.

This week the U.S. Federal Housing Finance Agency told a federal judge it had settled its case against Citigroup Inc. The agency won’t say how much money Citigroup is paying. Neither will Citigroup, which survived the financial crisis only because it got multiple taxpayer bailouts. The parties agreed to keep the terms confidential. The government has decided this is none of the public’s business.

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Elizabeth Warren Confronts Eric Holder, Ben Bernanke and Mary Jo White on Bankster Immunity

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Elizabeth Warren is one of the few Senators out there pushing to understand why the federal government has created an untouchable class of criminals in America that can do whatever they want whenever they want and, not only get away with it, but also get bailed out when they make mistakes.  In case you missed it, I highlighted a powerful video a few months ago in which she made regulators squirm when confronted on “too big to jail.”  Now she has written a letter to Ben Bernanke, Eric Holder and Mary Jo White.  My favorite line is:

“If large financial institutions can break the law and accumulate millions in profits and, if they get caught, settle by paying out of those profits, they do not have much incentive to follow the law.”

Indeed, which is why they don’t.  Full letter embedded below.

Congress Moves to DEREGULATE Wall Street

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The best part of this story is that Wall Street is, of course, anything but regulated. Nevertheless, the minuscule rules that do apply to the nation’s financial oligarchs are apparently just too much to bare.  It doesn’t seem to bother Congress that the TBTF banks are actively involved in offshore payday lending schemes with rates well over 500%, or that they destroyed multiple municipalities across the nation selling swaps, including picking away at the carcass of the once strong Detroit.  Nope, all that matters is that Congress’ pockets are lined with Federal Reserve Notes.  As expected, this is a bipartisan effort.  From the Huffington Post:

WASHINGTON — A bipartisan cadre of House lawmakers will move on legislation to deregulate Wall Street derivatives Wednesday, less than a week after Sen. Carl Levin (D-Mich.) released adevastating report on the multibillion-dollar derivatives debacle at JPMorgan Chase.

“It is incredible that less than a week after new JPMorgan Whale hearings detailed how the bank’s London office piled up risk, hid losses, and dodged regulatory oversight, that some House members are again supporting the weakening of derivative safeguards.”

It’s not incredible Carl, it’s called payoffs.

Yet in an era of partisan gridlock in the nation’s capital, Democrats and Republicans have come together to repeal or weaken those rules. Although Obama may not want to sign a standalone package of Wall Street deregulation into law, bipartisan legislation could be inserted into a broader bill that the president might find difficult to reject.

I’m sure it’ll be real difficult for Barry to sign.  About as gut wrenching as signing the NDAA.

At a congressional hearing last week, Wallace Turbeville, a former Goldman Sachs banker and current senior fellow at the public policy group Demos, testified on behalf of Americans for Financial Reform that exempting utilities from the rules would ultimately help Wall Street firms profit at the utilities’ expense.

“I had the uncomfortable opportunity to witness sales calls by derivatives specialists on governmental utilities,” Turbeville said. “I have seen the technique of fostering a sense of trust, encouraging an advisory relationship that can be exploited to sell an immensely profitable derivative when other alternatives could be better.”

The bills to be considered Wednesday also include legislation from Rep. Jim Himes (D-Conn.) — another Goldman alum — that would roll back Dodd-Frank’s ban on taxpayer support for some kinds of derivatives trades. Himes has defended his bill as a way to ensure that more regulators oversee derivatives, though the measure is opposed by the Americans for Financial Reform.

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HSBC Faces More Money Laundering Accusations

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I’m shocked.  Shocked, appalled, horrified and betrayed.  Actually, I’d be shocked if this didn’t happen.  From Reuters:

BUENOS AIRES, March 18 (Reuters) – Argentina’s tax agency said on Monday it has uncovered 392 million pesos ($77 million) in fraudulent transactions by HSBC Holdings Plc and said it has asked the judicial system to probe the European bank for alleged tax evasion and money laundering.

HSBC, Europe’s largest bank, was fined $1.9 billion last year for similar irregularities in Mexico and the United States.

“On the basis of what’s been investigated so far, in six months we’ve recorded 392 million pesos in fraudulent transactions, generated by evasion and money laundering,” Echegaray told a news conference.

Echegaray said HSBC executives had secured fake receipts from local businesses, allowing illicit transactions to be made.

HSBC said the AFIP’s allegations were of “great concern.”

“Great concern” huh?  Concerned about what exactly?  A tiny slap on the wrist?  What a menace to society these big banks have become.

Full article here.

In Liberty,
Mike

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GATA Meets CNBC: Host Calls Gold Market a “Matrix”

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First off, fantastic job by Chris Powell in this interview.  The host cracked me up when he describes the gold market as “almost like the matrix.”  My favorite line from Chris is when he says “the banks are bigger than the government.”  Those two lines sum up a lot of what’s wrong with the world today.

Of course, this video was aired when Americans were fast asleep.


More Evidence Emerges of Big Banks Abusing American Military Families

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“Complaints that active military personnel and National Guard members were losing their homes while deployed in war zones set off national outrage and prompted Congressional hearings in 2011. The case of Sgt. James B. Hurley, a disabled veteran whose home outside Hartford, Mich., was sold two months before he returned from Iraq, dragged through the courts for years, highlighting the devastating effect of foreclosures.”

- From the recent New York Times article: Banks Find More Wrongful Foreclosures Among Military Members

The above is part of a very depressing theme I have covered in the past.  Most recently in my piece from last November titled:  Big American Banks Particularly Enjoy Ripping off Active Duty U.S. Soldiers.  Today’s post follows up on that one and what we find; unsurprisingly, is that the more you peer behind the curtain, the more filthy the whole thing becomes.  That’s precisely why the oligarchs don’t want anyone to peer behind the curtain for too long.  From the New York Times:

The nation’s biggest banks wrongfully foreclosed on more than 700 military members during the housing crisis and seized homes from roughly two dozen other borrowers who were current on their mortgage payments, findings that eclipse earlier estimates of the improper evictions.

Bank of America, Citigroup, JPMorgan Chase and Wells Fargo uncovered the foreclosures while analyzing mortgages as part of a multibillion-dollar settlement deal with federal authorities, according to people with direct knowledge of the findings. In January, regulators ordered the banks to identify military members and other borrowers who were evicted in violation of federal law.

These four banks just keep popping up in criminal schemes don’t they?

The analysis, which was turned over to regulators in recent days, provides the first detailed glimpse into the extent of wrongful foreclosures amid the collapse of the housing market. While lenders previously acknowledged that they relied on faulty documents to push through foreclosures, the banks claimed borrowers were rarely evicted by mistake, including military personnel protected by federal law.

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Video of the Day: Regulators Squirm When Asked About “Too Big to Jail”

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This video has been going around for a few days, but wow.  Very powerful and could be effective in knocking some sense into more sheeple if it gets spread widely enough.  It’s an absolute joke that these people being questioned by Senator Elizabeth Warren are supposed hold the banks to task.  I mean this Tom Curry character.  I could probably go up to him, take his glasses off his face and walk away and he wouldn’t even notice.  Furthermore, those little placards in front of them that state “honorable.”  These people have zero honor.  The joke’s on us.

She also makes the key point how ordinary citizens are constantly harassed by the “authorities” for what are in many cases petty and victimless crimes, while the bankers who have unleashed more destruction than anyone else, get slaps on the wrist.  Every single American should watch this short clip.

Big American Banks Particularly Enjoy Ripping off Active Duty U.S. Soldiers

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The following article from the Houston Press titled “Country Club Sopranos” is the most comprehensive rundown I have seen of all the various frauds committed by large banks since we bailed them out.  What I find particularly infuriating is that the banks seem to really like ripping off members of the armed forces.  Veterans pay close attention.  The biggest threat to America does not reside outside our borders, but from within.  This is a very powerful article and I think could be quite effective in waking up some sheeple so please pass it along.  Here are some of my favorite passages:

But despite a colossal civil-rights fraud perpetrated against 30,000 customers, the settlement amounted to just .011 percent of the San Francisco bank’s annual income. It was like forcing a $30,000-a-year working stiff to pay a $240 fine.

These were just the opening salvos of the assault. Bank of America was caught illegally foreclosing on the homes of active-duty soldiers.

But not a single boss went to jail. Some firms settled for just a fraction of what they’d stolen. Most have never admitted wrongdoing. And in the ethics-optional land known as Wall Street, many saw their stock prices rise.

“Unquestionably, that’s true,” says Notre Dame law professor G. Robert Blakey, whose career prosecuting organized crime runs all the way back to the Kennedy administration. “I was looking at stuff on Mulberry Street, and the real theft was on Wall Street…All of the people who ran the scams have their big houses and their airplanes, and they’re laughing — they got away with it.”

“My biggest mistake in life was that I committed my crimes in the 1980s,” he says. “If I committed them today, I wouldn’t even get house arrest. I’d just hire a good lawyer and pay a fine and I’d be free.”

It began the year before, when Dimon’s bank paid a $27 million settlement for systematically screwing 6,000 active-duty soldiers. JP Morgan was caught overcharging on interest rates and illegally foreclosing on the soldiers’ homes. (The bank did not respond to interview requests.)

But when he appointed Eric Holder attorney general, it was like making John Dillinger’s lawyer head of the FBI bank-robbery unit.  Holder, a former Wall Street defense attorney, would ramp up big-dollar settlements. But criminal charges quietly sputtered to a trickle.

“Retired criminal” Sam Antar, who now trains the IRS and FBI how to bust corporate looters: “It’s almost like stealing a billion dollars with a pencil is not as bad. You have a lesser chance of going to jail than if you mug somebody on the streets of New York.”

So bad has the leniency become that the feds are allowing bankers to keep much of what they steal. Ask Morgan Stanley.

In August, it settled with the Justice Department over its role in fixing New York City’s electricity rates. The bank played middleman in a deal between two energy providers, KeySpan and Astoria Generating, which then colluded to withhold electricity from the market, artificially driving up prices and costing consumers an estimated $300 million.

Morgan Stanley was paid $21 million for arranging the scheme. But the ever-generous Holder let the bank settle for $4.8 million.

It marked a stunning new low in federal prosecutions, akin to forcing a bank robber to return just $2,500 after stealing $10,000. With no jail time, of course.

Morgan Stanley offers little defense for its actions. “We will decline comment,” says spokeswoman Mary Claire Delaney. But New York state senator Michael Gianaris will happily fill that silence.

“It’s a good business deal for Morgan Stanley,” he says. “They could break the law and get away with almost $17 million in profits for it, so why not do it again? If they get caught — and that’s a big if — they still get 70 percent of the profits.”

Peter Vallone Jr., a Queens councilman and former prosecutor, has never seen such tender handling of criminals.

I was a prosecutor for six years, and I’ve never seen someone being fined less than they made.”

In less than two years, Bank of America had chalked up six major fraud cases. But there was no talk of three strikes. No indictments for racketeering. Not one executive charged with a crime.

Now here is my favorite one:

A month later, ING paid a $619 million settlement for violating international sanctions and anti-terrorist laws. It spent a decade providing “state sponsors of terror and other sanctioned entities with access to the U.S. financial system,” Assistant Attorney General Lisa Monaco said at the time.

So the American people have sacrificed the Bill of Rights and all civil liberties to fight the phony “war on terror,” yet banks pay a settlement for aiding “terrorists.”  What do you think would happen to you if you were caught doing that?  A cell in Guantanamo? A drone missile to the head?

Full article here.

In Liberty,
Mike

 

Bitcoin: A Way to Fight Back Against the Financial Terrorists?

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Although I have followed Bitcoin over the years a bit, I am admittedly pretty ignorant on the subject.  What really caught my eye in the last couple of days was an article in Forbes detailing the fact that when the big financial institutions initiated a blockade on Wikileaks, the whistleblowing organization was still able to accept donations via Bitcoin.

From Forbes:
It used to be that people had secrets and the government was transparent; now it’s the people that lack privacy and the government has secrets. Freedom of payments is an extension of financial privacy and digital cash-like transactions without financial intermediaries become a critical piece of that foundation. Money was never intended to act as a form of identity tracking or payments restriction and this is why the option for anonymous and untraceable transactions is so vital as society moves to a world of digital currency.

To those that don’t support freedom of payments, consider this financial blockade invoked in the name of political correctness before you dismiss the inherent value of a nonpolitical unit of account and of a decentralized medium of exchange. It should be offensive to most free-minded people that you are not the final arbiter of how and where you spend your money. Bitcoin restores the balance.

I don’t think Bitcoin is THE answer.  It could be part of a solution.  Gold could do it.  Silver could do it.  They key point; however, is that in a world in which payment is increasingly digital we need more options for a medium of exchange.  Governments themselves should arguably get out of the money businesses entirely and let people and business transact with each other however they deem appropriate.

One thing that each and every one of us needs to agree on is that the ability to buy and sell certainly shouldn’t be in the hands of these TBTF (too big to fail) financial terrorist institutions.  These institutions, which have raped and pillaged this country in the last several years, shouldn’t even exist let alone have this kind of power.  The mere existence of these institutions is an insult to every single American alive today and an embarrassment to the memory of our ancestors who aggressively guarded the liberty and freedom this current generation of leaders is so willing to give away.  As Neil Barofsky, the former Special Inspector General for TARP, so eloquently put it today:

As I saw first hand while providing oversight of the bank bailouts as the Special Inspector General of the Troubled Asset Relief Program and as I detail in my recently released book Bailout, this perception was embraced by both Bush and Obama Treasury officials, who repeatedly turned away my efforts to impose conditions, restrictions and transparency on the banks. They declared such measures unnecessary because the banks “would never risk their reputations” by putting profit over the public interest.

Two years after the passage of Dodd-Frank, and in the wake of the recent proliferation of scandals involving the largest banks, many are now embracing this cinematic truth, with even the banker’s Dr. Frankenstein himself, Sandy Weil (whose Citigroup was the founding model of the megabanks of today), picking up a pitchfork and joining the growing mob of academics, regulators, former bank executives, Occupiers and Tea Partiers in calling for the monster to be torn apart.

Read the Forbes article on Bitcoin here.

Read Barofsky’s piece on the bipartisan support for the financial terrorists here.

Reality Bites

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The difference between [socialism and fascism] is superficial and purely formal, but it is significant psychologically: it brings the authoritarian nature of a planned economy crudely into the open. The main characteristic of socialism (and of communism) is public ownership of the means of production, and, therefore, the abolition of private property. The right to property is the right of use and disposal. Under fascism, men retain the semblance or pretense of private property, but the government holds total power over its use and disposal.

Under fascism, citizens retain the responsibilities of owning property, without freedom to act and without any of the advantages of ownership. Under socialism, government officials acquire all the advantages of ownership, without any of the responsibilities, since they do not hold title to the property, but merely the right to use it — at least until the next purge. In either case, the government officials hold the economic, political and legal power of life or death over the citizens.

Needless to say, under either system [socialism or fascism], the inequalities of income and standard of living are greater than anything possible under a free economy — and a man’s position is determined, not by his productive ability and achievement, but by political pull and force. Under both systems, sacrifice is invoked as a magic, omnipotent solution in any crisis — and “the public good” is the altar on which victims are immolated.

- All Quotes by Ayn Rand

Reality Bites
The thing that I disdain more than anything else with regard to the government bureaucrats and Central Planners, is the inexplicable and unjustified confidence they have in their abilities.  As much as I bash Wall Street, I would rather have a good investor (not a crony, government welfare baby investor like Warren Buffett, but a legitimate one), in a leadership position rather than the lifetime academics and politicians (lawyers) that are running things today.  Why?  Because anyone that has worked in the real world of investing has made so many mistakes it is impossible to count.  I want to make clear that none of this applies to the TBTF banks, which absolutely couldn’t make a dime without government handouts and bailouts, or the buy-side firms that are in bed with the government (you know who you are), but legitimate “eat what you kill” investors and traders that have no help and must be right more than wrong to survive.  These folks are consistently humbled, week after week and year after year by the market and forces beyond their control.  They are constantly reminded that failure is just around the corner.  In many cases, folks do fail and then they have to pick themselves up off the ground, shake away the dirt and fight to win another day.  This of course doesn’t merely apply to investors and traders, but to all those out there in the private workforce trying to create a new business, climb the ladder from line cook to store manager at McDonalds or Wal-Mart, or those spending hours upon hours in a garage or lab trying to discover the next game changing invention.  The people it does not apply to are the people running the planet at the moment, which is why there is no doubt they will run the entire global economy straight into the ground.

We need to understand that there is a war raging outside.  A war between the parasite class and the productive human.  The parasites have total control of all levers of power at the moment, and they intend on using the ultimate implosion of the system to further consolidate their gains in order to create a neo-feudalist society where productive humans will become serfs that exist merely to produce for the pleasure of the parasites with no hope of escape for themselves or their children or grandchildren.  We cannot allow this to happen, which is why the most important thing is to inform as many people as possible of the game plan ahead of time so that they are unable to manipulate humanity to acquiesce to its own bondage in the middle of a crisis.

The most dangerous people on the planet are the lifetime academics and these are the folks in charge of the most powerful institutions in the world today, the Central Banks.  These lifetime academics have been coddled their whole lives within the “prestigious” institutions that define the paradigm that we live under.  In rising high up in academia, these folks never really experienced failure.  Sure, they may have received a B+ on a paper once instead of an A, but they have never experienced that crushing failure that only the real world can deliver.  As I mentioned earlier, I would put all of the leaders of TBTF banks/brokers in the same category.  They have been bailed out at the taxpayer’s expense so many times that they do not live in reality either.  When they fail they get bailed out, when they succeed they take all the gains and then buy everyone else off around them.  This is not a novel point, but it is extremely important to fully internalize because these are the people (academics and TBTF executives) that are in total control of all economic, social and political policy in the Western world today.  It is because of them that we are in the situation we are in and it will be because of them that we will crash and burn.

So What Will The Maniacs in Control Do?
Mario Draghi’s (The head of the European Central Bank) statement today, is a perfect example of how delusional and dangerous these characters are.  Amongst other things, he stated that “the ECB is ready to do whatever it takes to preserve the euro,” and that “believe me, it will be enough.”  First of all, whenever a bureaucrat says “whatever it takes” images of red flags should appear all over your field of vision and you should immediately turn around and run the other way as fast as you can.  He also stated that the European Monetary Union is “irreversible.”

Ok, so let’s dissect these statements.  First, nothing in life or human society is irreversible.  I am sure the Pharaohs of Egypt and the Emperors in Rome said similar things right before their civilizations came crumbling down.  There is no need to make such statements when a civilization is functioning well and the populace flourishing.  Such statements are the last refuge of weak leaders in failing systems.  How about the “whatever it takes line.”  Notice he didn’t say he would do “whatever it takes” to create a better system, or to empower humanity.  No, he said whatever it takes to preserve the Euro, despite the clear fact that a breakup of the euro prison would be the best options for all of the PIIGS.  So what we can take away from the statement is that once again they will do “whatever it takes” to preserve the big banks and the status quo.  If 99.9% of humanity goes down in the process, that is merely collateral damage to these guys.

This brings me to the final point.  We are right now about to enter by far the most dangerous period since 2008.  The reason I say this is because I believe the Central Planners realize that their theories were nothing but eloquently written academic nonsense and have completely failed in practice.  Rather than ever admit this and change course, I know how these clowns think and they would rather burn the world to the ground than “lose.”  I think it has been about a year since The Bernank realized his whole life’s work will be relegated to the trash bins of history, but in an attempt to save face, he and all the others will lie, cheat (manipulate behind the scenes) and steal.  They have been doing this for all of 2012, and with the U.S. now in recession they will do more.  So brace yourselves.  If you don’t already realize this is war, you will soon enough.  The parasitical system of control is breaking down all over the place and TPTB are getting increasingly desperate.  An increasingly desperate power structure is a dangerous one.  Get emotionally ready for the trying days ahead.  It will not be easy but free humanity will prevail.  For some more in depth thoughts on what I see in the days to come please take a listen to this in-person interview, “Don’t Live in Fear,” I recorded while at Freedom Fest a couple of weeks ago.  I think it is one of the best interviews I have ever done.

Peace and wisdom.

In Liberty,

Mike