Yves here. Bill Black discusses his favorite topic, fraud, with Marshall Auerback of the Institute of New Economic Thinking. Some of this talk is familiar terrain for those who know Black’s work, such as Black’s well-argued criticism of the failure of financial regulators to make criminal referrals for misconduct in the runup to the financial crisis. Even so, many readers are likely to find new information here, such as the number of FBI agents assigned to handle white collar fraud, and how some regulators during the savings & loan crisis defied Congressional pressure to go easy on failing and defrauded banks, and the career costs they paid.
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That’s easy. They’re in on the fraud.
In retrospect it seems likely that taking the FBI off the financial crimes beat and putting them on terrorism beat was a strategic move on the part of DOJ, at the behest of Wall$t interests.
After all, they passed the bankruptcy reform act well ahead of time because they foresaw the need to prevent our escape from the coming crisis, evidence they have some overall understanding of the likely results of their behavior.
Why then would we doubt they plan ahead to forestall prosecution for their crimes by systematic gelding of regulators and Justice to create a backstop?
(Not mention the missing $ trillions Rumsfeld admitted to congress on 9/10/01, and the subsequent attack on the Pentagon that managed to destroy only the offices of the guys auditing the MIC books?)
(Not mention the missing $ trillions Rumsfeld admitted to congress on 9/10/01, and the subsequent attack on the Pentagon that managed to destroy only the offices of the guys auditing the MIC books?)
The Pentagon has been hiding the evidence of wf&a from the public since long before 9/11. It sounds like you need to brush up on “leaps of logic”, “jumping to conclusions” and most of all critical thinking, seriously. The insinuation you’ve made is the attack on the Pentagon was (at least in part) to destroy evidence from auditors.
Really?! I’m gunna go out on a limb here; you follow Alex Jones. Please, less Alex (much less) and more rational, objective critical thinking. We can’t get too much of that.
http://www.youtube.com/watch?v=A7zbEiNnY5M
https://www.google.com/search?q=critical+thinking&ie=utf-8&oe=utf-8&aq=t&rls=org.mozilla:en-US:official&client=firefox-a&channel=sb
The way officials dealt with the massive financial fraud during the aughts, particularly the Obama Administration, was the final nail on the coffin of the U.S. government. There is no way to argue that we have a legitimate government in Washington. First 9/11 and the Global War on Terror a totally bogus and Orwellian enterprise that took FBI agents out of their jobs chasing wild geese or focusing on dissidents like Occupy protesters. I believe that the fraudulent nature of the GWOT should be a key ingredient of any analysis of our political situation and it should be looked at as a part of the massive financial fraud of that period–the two are not separate.
The rest of the federal government will collapse into the most sordid kind of political corruption eventually though this will take some time since most bureaucrats, dispirited as many of them are, are not constitutionally corrupt or corruptable–but eventually the Washington maxim of “no good deed goes unpunished” will win out. When I say corrupt, btw, I mean structural corruption not a few people selling their services to the people they regulate–I mean the corruption we have today is sytemic and incurable. Reform cannot happen at this time–there are no political forces that have a) articulated how bad the situation actually is (if criminals suffer no consequences then criminals will flourish); and b) know how to do anything to remedy the situations. The mainstream media and even the financial press is an integral part of the system that is focused on disinformation and misdirection with, at least, the occasional article that shows a little glimpse of the ankle of this situation.
Anyone familiar with the work of Black and many others that does not grasp that a system that rewards its worse criminals is, essentially, a criminal system. It is as if organized crime has taken over the U.S. and we haven’t even noticed! Where is Batman?
The one good line Kinsley has, “the outrage is not what’s illegal, its what’s legal”
The 0.1% have 24/7 access, and no one else does. These government people cannot even fathom what is wrong, because they are never actually exposed to another viewpoint…
The fraud is pervasive in all of our courts and government. We sued our insurance company after they refused to pay our claim, and brought out their “preferred contractor” who stalled the work to restore our burned home. I went to the Appeals Court, and showed them where Allstate’s lawyers lied to the judge, and where we had proof that what Allstate told the court, that we were not living in our house at the time of the fire, etc. was merely made up by the lawyers for the insurance company. The appeals court found all kinds of problems with my briefs, that I was not a lawyer, etc. I am 73 years old and I no longer believe that America is the land of the free.
Not only is there (almost) nobody calling out the criminals for their behavior, the bad actors themselves believe they have done nothing wrong.
If I am ever charged with a crime, I’ll just arrange a personal meeting with the USAG. We can work something out over drinks.
Remembering that it is only petty criminals that are subject to law today.
They knew very well what they were doing–these guys brag about it in private the way adolescents do about their transgressions–they believe they are the “cool” guys of the world and so, it appears, does most of the rest of the population.
During an oral argument, a foreclosure defense attorney was forbidden by the judge to use the word, “FRAUD” when she was arguing that the banks were committing FRAUD.
I am that foreclosure defense attorney. I was arguing against a motion to strike my client’s counterclaims against PNC Bank, N.A. and its predecessor, the servicer of a Freddie Mac mortgage, which included a cause of action for FRAUD. My client’s timely payment in October, 2008 was refused by the mortgage servicer, National City Mortgage Company, which had merged with National City Bank (of Cleveland), the sole survivor of multiple mergers of separate National City Banks in 2006. National City Bank was trying to qualify for TARP funds and was trying to create as many defaulted loans as possible to claim TARP funds to re-capitalize itself and avoid a hostile takeover (characterized as a merger by the Office of the Comptroller of Currency) by PNC. My client was current on her mortgage payment and had paid over 30% down on her home, on the bargained-for condition that her loan would not be sold to any third party. National City Mortgage Company was doing business as FNMC in the State of Maryland when she negotiated for the loan. The Note she signed and the Mortgage she granted were payable to and granted to “FNMC, a Division of National City Bank of Indiana,” which ceased to exist in 2006. Wisconsin law requires plaintiffs to plead their identity and capacity in the initial complaint, which was not done. The trade name FNMC had expired in February, 2008. National City Mortgage Company, the servicing agent for Freddie Mac, merged into National City Bank (of Cleveland) on October 1, 2008. The complaint was filed in the name of a nonexistent entity in April, 2009. When it was discovered on December 30, 2012 that Freddie Mac claimed ownership of the loan by purchase on the loan collateral (note and mortgage) on September 14, 2005, it was clear that the complaint alleging that “FNMC, a Division of National City Bank of Indiana” is the “current owner and holder of the Note and Mortgage” was a fraudulent misrepresentation to the Court. Our amended pleading counterclaiming for several causes of action, including FRAUD, breach of contract, and other counts, was stricken by the judge “for all the reasons stated by PNC.” I did not succumb to the judge’s instruction not to use the word FRAUD and my client continues to argue the defense of fraudulent foreclosure, in the face of sanctions for removing the case to federal court within 30 days of discovering the grounds for federal jurisdiction, which is that Freddie Mac is the real party in interest and original federal jurisdiction arises under 28 USC 349 because Freddie Mac is more than one half owned by the United States Treasury. A petition for writ of certiorari to the United States Supreme Court is being prepared. My client is still residing in her home, despite the manufactured default, sale of her loan documents in breach of a condition precedent, fraudulent pleading in the name of a nonexistent entity, concealing the identity of Freddie Mac, and intimidating sanctions. FRAUD is FRAUD. There is no other word in the English language for it. I told the state court judge that I had to use the word FRAUD because that is the legal name for the cause of action being asserted.
My client would be delighted to share her story, in detail with Yves. She is a whistleblower, a law school graduate and an activist for homeowner’s rights. She has a remarkable story to tell. The same scheme was used on hundreds of other homeowners who have been and are being foreclosed based on Notes and Mortgages payable to and granted to “FNMC, a Division of National City Bank of Indiana.” We have found no evidence that FNMC was ever a “division” of National City Bank of Indiana. Like America’s Wholesale Lender, a trade name used by Countrywide Home Loans, Inc., which also never existed as a corporate entity, the name “FNMC” appears to have been used to conceal off-balance sheet transactions to avoid regulation. The initials “FNMC” are coincidentally an acronym for Federal National Mortgage Corporation, which is a blend of the initials of the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac) which is what caused us to investigate National City Mortgage Company’s business model. It appears to have existed solely as a conduit to acquire loan collateral for the two GSEs.
That Holder said it might be “fraud” but he wasn’t touchin’ it with a 10-ft pole, is a quote to die for. I must ask then, isn’t the US financial system a classic SOE? Indeed it is. China eat your heart out. So it follows that MMT doesn’t necessarily apply in this case because our system divvies up the money inequally by design and not equally (also by design) – ergo corporatist design. Nevermind that 90% (?) of our corporations are terminal. Giving the banksters (partners in crime) a lavish allotment mostly to allow them to then support the MIC and etc. God praise private banking, er, agency banking. So what’s not to love about Bill Black’s wonderfully graphic description about the authorities denying “fraud” as “suddenly realizing you are in an elevator with a crazy person.” And it then almost makes me think, in my entrenched paranoia, that the S&L crisis might have merely been a dry run.
“History with all her volumes vast, hath but one page.” -George Gordon Byron
I am an old guy and I have worked with perhaps thousands of acronyms in my career doing engineering for our military. I do not know “SOE”. What does it refer to?
Given the proliferation of acronyms, the military adopted a rule requiring spelling out an entire term followed by its acronym in parens whenever an acronym is first used in a document.
I do not enjoy quibbling this petty matter. I enjoy your comments and value them. I cannot fully understand your comment.
I do not know “SOE”. What does it refer to?
State-owned enterprise, probs. “China eat your heart out.”
When you have CEO’s like Jamie Diamon who goes before Congress wearing White House cufflinks, he pretty much gave the finger to Congress. and Obama saying they did nothing wrong, is why I lost my support for President Obama. Obama why did you have to suck Diamon’s dick?
Even the Financial Crisis Inquiry Commission (FCIC) was told they could never use the word “Fraud” in their investigations. Sick, isn’t it – and sickening.
I can’t wait to hear how Holder is going to answer the questions about Alayne Fleischmann, the former JPMorgan Chase securities lawyer who tried to blow the whistle on “massive criminal securities fraud” by the bank and Jamie Dimon, only to have the government try to silence her with a $9 billion settlement. Like we’ve been trying to say for years, you can prosecute the TBTF’s.