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TechnoratiNeeded: A New Commission to Probe Corporate Crime
Why Hasn’t Obama Targeted The Ongoing White Collar Crime Wave?
Another day. Another ponzi scheme.
This time it's the Millennium Bank in the Eastern Caribbean accused of a mere $65 million dollar rip off. (Ponzi king Bernard Madoff allegedly took in $65 billion.) Regulators say there is a "ponzimonium" underway with scores of newly opened investigations. We are talking about pervasive institutional crime, not just individual theft.
The role of shady, largely unreported, "off shore" institutions is slowly emerging as a component of a larger criminal scheme. There is a report that "a class action lawsuit has been filed against several offshore entities and individuals on behalf of investors in four hedge funds who allegedly lost over $3 billion in the Bernard Madoff fraud."
On shore, in New York, Attorney General Andrew Cuomo has issued new subpoenas to AIG. Former Governor Eliot Spitzer is saying the problem there is not just with bonuses by billions from government bailouts going to "counterparties" -- companies that did business with the infamous insurer which just changed its name.
Reports the Wall Street Journal: "CDS contracts were at the heart of AIG's meltdown," Cuomo said in a statement. "The question is whether the contracts are being wound down properly and efficiently or whether they have become a vehicle for funneling billions in taxpayers dollars to capitalize banks all over the world."
The Obama people must be worried about the capacity of white collar crooks to undercut their own programs because they are setting up their own investigation of those who took bailout monies.
Reports a Memphis newspaper: "Eil M. Barofsky, the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), recently announced the creation of a broad, multi-agency task force designed to deter, detect and investigate instances of fraud in the soon-to-be-launched Term Asset-Backed Securities Loan Facility (TALF) program."
They know who they are dealing with. It's always been easier to rob banks with fountain pens and electronic transfers than guns and stickups.
In North Carolina, a judge sentenced Lance Poulsen, the former CEO of National Century Financial Enterprises, to 30 years for security frauds. Said the Judge, "Poulsen was the architect of a fraud of such magnitude that it would have made financial experts shudder."
Judges may be shuddering but our media is still downplaying the extent of the crimes behind the collapse of our economy. This issue does not seem to have a high priority with the Obama Administration either. The President had denounced "reckless speculation" but is preoccupied with pumping more money into banks rather than tracking down the fraudsters that Franklin Roosevelt called "banksters."
Recall that this crisis started with the collapse of the housing bubble. The FBI has called mortgage fraud an "epidemic" and says "the thousands of financial fraud investigations now underway are putting a strain on the bureau's ability to fight other crimes. An explosion of mortgage fraud cases has stretched the FBI so thin it's having a hard time investigating other white collar crime."
They have 250 agents investigating these crimes as compared to more than l000 who handled the S&L crisis in the 1980s. Many of their corporate crime experts were reassigned to combating terrorism.
The Tri-State Defender in Memphis reports:
"The Federal Bureau of Investigation said it received 46,717 suspicious activity reports related to mortgage fraud last year - compared with 45,617 in 2006 and 6,936 in 2003. By the end of fiscal year 2007, the Bureau was handling just over 1,200 mortgage fraud investigations - a 47 percent rise from 2006. That figure has reached 1600 for the current fiscal year.
FBI Deputy Director Pistole told a Senate Judiciary Committee last month that the agency is investigating 530 open corporate fraud investigations, including 38 directly related to the current financial crisis. Pistole said the fraud investigations were putting a strain on the staffs.
"The increasing mortgage, corporate fraud and financial institution failure case inventory is straining the FBI's limited white-collar crimes resources," he said."
FBI Director Mueller told the Senators the Justice Department and the bureau were working on "what we call fast track prosecutions in a number of areas, and....we're prioritizing our cases to hit the most egregious early and put those persons away."
The Financial Crimes Enforcement Network (FinCEN) released a new report that shows subjects reported for suspected mortgage loan fraud may also be involved in other financial crimes such as check fraud, money laundering, stock manipulation, structuring to avoid currency transaction reporting requirements and others. From depository institution Suspicious Activity Reports (SARs), FinCEN identified approximately 156,000 mortgage fraud subjects, and found that 2,360 were reported for suspicious activity in 3,680 of the other SAR types.
"This study analyzes the possible interrelationship of illicit activity occurring across different financial sectors. Criminal actors may attempt to exploit any vulnerability to commit fraud and launder money through a range of financial institutions," said FinCEN Director James H. Freis, Jr. "The interconnected nature of suspicious activity across multiple financial sectors covered by FinCEN's Bank Secrecy Act regulations underscores the immense value of combining insights from the different sectors for the purpose of detecting and thwarting criminal activity."
This whole crime by crime approach is incremental at best and misses the deeper problem. We might look back at an earlier crisis and learn what was done then to combat what John Kenneth Galbraith denounced as widespread "corporate larceny."
Galbraith cited the Pecora Commission which in 1932 investigated the causes of the 1929 crash. It uncovered a wide range of abusive practices on the part of banks and bank affiliates.
A Wikipedia entry explains: "These included a variety of conflicts of interest such as the underwriting of unsound securities in order to pay off bad bank loans as well as "pool operations" to support the price of bank stocks. There was outrage then when banker JP Morgan admitted he had paid no taxes for two years. The commission's Chief Counsel Ferdinand Pecora said ;
‘Legal chicanery and pitch darkness were the banker's stoutest allies."
Somehow those lessons were lost. Amnesia about the past contributed to denial about the present. We need a new Pecora Commission with subpoena power to investigate the causes of this crisis-and it's too bad that a man with the stature of John Kenneth Gailbraith is not alive to chair it.
Senator Bernie Sanders is calling for just such a commission complete with an investigative staff and subpoena powers. Why don't all progressive groups, media, unions, and concerned organizations endorse this call. We need professionals like Eliot Spitzer who had denounced predatory lending practices involved. You need people who have been on Wall St to see through the tricks on Wall Street.
We need to look into the $5 billion these firms have spent to rewrite laws and deregulate. We need to know which politicians took their payoffs and do their bidding. We need a jailout, not just a bailout.
We need to remember Balzac's insight: "Behind every great fortune lies a great crime." But he was not the only great thinker with insight. "In a closed society where everybody's guilty, the only crime is getting caught," wrote Hunter S. Thompson, " In a world of thieves, the only final sin is stupidity." And that does not just apply to the perpetrators.
32 Comments so far
Show Allsmipypr
Some US Attorney, somewhere, has got to have a few files started based on our old friend, RICO. A few well-placed subpoenas can make for a good start, if they don't appear to be casting a noticeably wide net - at first. Hank Paulson made it hard to follow the TARP money, but the trail existed long before the initial bailout began.
"This issue does not seem to have a high priority with the Obama Administration either. The President had denounced "reckless speculation" but is preoccupied with pumping more money into banks rather than tracking down the fraudsters that Franklin Roosevelt called "banksters."
The O'Dems are continuing their 30 year imitation of the Republican creed of holding self-interest and the interests of elites as more important than public interest.
While I love the honesty here of commenters, especially now that there is a mutual acceptance of the truth behind this 'financial terrorism' instigated, fueled, constructed,and prosecuted by the respected 'Republican Party, the sophism continues and the ranks of the ignorant, again begin to swell.
People!
This will occur ad nauseum. Take a Pepcid. Drink tonic water, etc. your parents told you about.
it makes one wonder...
has it ever occured to americans that were one to LIST these things:
america having the largest arsenal of DESTRUCTION and KILLING the world...
going to war unilaterally, attacking weaker nations for "national interest" - defined by General Smedley Butler as "Foreign policy ALWAYS been geared towards gathering as much of the world's resources unto ourselves at the expense of other nations"....(which by any definition is plain theft and murder and plunder)
domestic implosions and disfunctionalities:
Corporate dominance of life, loss of liberties, a debased entertainment-fed culture, shallowness, intellectual and moral depravity,
dishonesty about the role of the nation in the world...
hubris,
rewarding the BIGGER and more institutionalized the Crimes
banks and corporations run rampant.
a business community largely profiteering upon human misery
politicians who talk Orwellian language
hypocrisy of a monumental scale about not only torture, "democracy" and "freedom"....and 'accountability'....
a propensity for parasitically consuming far more of the world's resources than it really deserves..
etc etc etc etc etc......
does it really surprise anyone that the Muslim world had long denounced the USA as "the great satan?"
God save us from friends like Ethel and Julius Rosenberg and AIPAC spies.
Getting caught especially in 'war time' can get a person killed. Amen!
The Justice Department is feeling the heat as it continues the prosecution of former AIPAC staffers Steve Rosen and Keith Weissman.
The two officials from the American-Israeli Public Affairs Committee (AIPAC) were in 2005 indicted for passing along secret US documents to Israel in violation of the 1917 Espionage Act.
The American Jewish Committee and the Anti-Defamation League, two top Jewish lobby groups in the US, are demanding the Justice Department reconsider its case against Rosen and Weissman.
actually
as early as Thomas Jefferson -- said something like this:
realizing or imagining perhaps the POTENTIAL for MONSTROSITY that the nation created bore....
he said:
"IF there is a God of JUSTICE....how I TREMBLE for our nation".
after all -- he had seen and lived and was part of the genocide that BEGAN the creation of the United States of America --
and grew it power and wealth through enslavement ]
in order to become an empire -- defined by the former CIA "economic hitman" (author of "Confessions of an Economic Hitman" ) -- John Perkins :
"we americans have very little understanding that the REASON we are LIVING the LIFESTYLES we have is because it is ONLY PART of a VERY, VERY VICIOUS system of exploitation and empire that ENSLAVES and MISUSES people everywhere".
We don't need new commissions. What we need are new pols. Besides, what's the guarentee that the new commission can't be corrupted? There's got to be a line to draw as to how far we can allow government to grow with too many useless bureaucracies. Don't get me wrong. I'm not an anarchist type Libertarian but I do believe that the electorate must ask itself why it keeps voting against its own economic interests by voting Republican or Democrat election after election? While I do appreciate honest efforts by a few good Democrats such as Kucinich, Maxine Waters, Barbara Lee, etc ..., I still tend to vote Independent and usually for ones who are like my favorite candidate Nader who I thrice voted for.
And why is this author wondering about Obama's refusal to prosecute white collar crime. Obama made no such promise to hold them accountable all throughout his campaign for president. All he did was spread his "hope and change" pixy dust while playing kissyface with Wall $treet and openly too. Even my friends who were supposedly "liberal" bought into Obama's crap hook, line, and sinker and joined the Obamabot crowd. Between the Obamabots and the Dubya diehards, I see no difference !
The United States, unfortunately , is like a computer that has SYSTEM WIDE CORRUPTION.
its very institutions are now UTTERLY CORRUPT.
"should this nation fall...it shall fall not because of foreign enemies or threats, real or imagined......it will fall because the people are CORRUPT".
Benjamin Franklin.
this includes the uncaring attitude of americans described as:
"we americans carefully nurture a studied attitude of detached indifference to the suffering of others.....
........ EVEN IF WE are the cause of it" (unknown american poet)
one might even ask:
HAD the Iraq invasion , even if revealed as based on LIES -- gone SUCCESSFULY...and COST america LESS than it turned out --
WOULD AMERICANS REALLY have "turned against it" if they could be CONVINCED it is a WINNER and "worth it"?
for here is revealed that americans don't "support war" ONLY when it is "costly" but so long as "it can be WON" and the price is TOLERABLE -=
no matter how EVIL WAR IS -- especially INVADING other countries for their resources........
americans likely WILL continue to support it
for america IS a WAR nation.
it was so -- from the beginning - it is so today.
its ENTIRE culture is suffused with WARMAKING. ...
whether it is ECONOMIC war or MILITARY war or Cultural or religious war -- which all go hand in hand -- one being merely the OTHER FACE of the different COIN denominations of the SAME CURRENCY ....of WAR against others as the ESSENTIAL and FINAL trait of America .
patrick buchanan said something quite wise:
"we americans have many fine qualities....seeing ourselves as OTHERS see us -- is NOT one of THESE qualities".
Well stated, JenniferBedingfield.
I'm losing count of the various commissions proposed to sort out the plethora of government and financial crises and scandals.
I mean, how many pieces can you cut Lee Hamilton into?
· Yr Obd't Servant
I don't want to cut anyone into pieces. What I would appreciate is government learning to make do with what they got. Dubya has no business to tell us to spend and Obama has no business telling us to sacrifice. We'll do our part but the government has to stop inventing excuses for stealing our taxpayer money and growing our government like mad. It's disgusting how the conservatives complain about big government and yet they too allow it to grow like mad. Ronnie Raygun would be blushing by now at this and Obama's stupid "inspiration" support. Sometimes, even the libertarians can be correct on the issue of government growing bigger especially at a time when the huge corporations such as AT&T (think FISA) and Halliburton (think war contractors in place of US troops) and getting into a toxic mix with the government and fulfilling Mussolini's dream of fascism. Corporations have no business tying themselves to government at the expense of the taxpayer. Either they be what they claim to be or fall apart already !
The U.S. Attorneys (prosecutors) are too busy prosecuting women on social security and may have worked part time jobs to supplement their meager income. They don't have time to prosecute the corporations. This is at what happened in Utah...the local assistant U.S. attorney is a prosecuting a schizophrenic woman who is on social security disability but to supplement her income she worked an additional job, and of course that is a felony because it "defrauds" social sec. admin. So the prosecutors have their priorities straight (at least here in the state of Zion) and are going after the those who may be working (working! mind you, not stealing) to make ends meet while being disabled. Welcome to the World of Alice in Wonderland!
What is needed is a new commission to probe corporate crime that does not include any individual with ties or connections to these entities just like obama did in picking his cabinet by selecting the same financial terrorists that got us here in the first place to 'fix the problem'. And that problem is those poor ole white boy ceo's meager pay of just a few million dollars. I still keep shaking my head over this.
It will take very objective investigators truly working in the interest of the people and NOT stacking the panel with corporate lackeys. And that goes to the necessity of congress becoming concerned and involved in regulating corporations that have proved their ciminal intent time and time again, by depriving the people of jobs, income and life. Consider this also, with the huge amount of criminality and corruption going on, this should provide a whole new bunch of jobs to start investigating and prosecuting these crimes. The key point here is the the lobbyists are the pivot men in the grand larceny circle jerk that is a determined effort to destroy the middle class. If this cozy arrangement is not broken up, the effects will be very bad for the people.
Just a few thousand bad apples, man, nothing to worry about. All the big boys have promised to be good from now on. Don't worry, be f@#king happy, okay?
Paraphrasing George Soros from 60 Minutes: you can't get rich in the financial "industry" legally.
Corporate crime is so widespread and the numbers so great that minority of honest people would have to be put in prison to protect them from the corporate wolves.
Britain is a mirror situation, and I'll wager that in The States Unemployment Benefit fraud is denounced constantly...However, needing a probe and getting one that gives consequences is a very long shot with a very slow bullet.
Enormous media attention and taxpayers money is thrown at Benefit Fraud "Which (OMG!!) Runs into Millions.......Whilst Corporate fraud conducts risk-assessed crimes as a profit driven right, totalling many....many BILLIONS!!!
For the future we need to replace the Stock Market Listing Statement that requires any newly listing company to declare that its reason for existence is simply for shareholder profit. The new Statement needs a caviat where working toward that profit does not jepordise human life, humam rights or the long-term sustainability of any physical natural environment. It is the only path to corporate responsibility and accountability.
nuffsed, I wouldn't take your bet because it's a sure winner.
You would have done better to name yourself "wellsed".
Indeed, when it comes to military expenditures and corporate welfare, our political overlords, ostensibly Servants of the People, remain wholly focused on how far they can roll that decimal point to the right; the decimal point is rather like a bowling ball launched forcefully up the lane, and it's a strike every time.
A few more hundreds of billions? Done! Frankly, we've been dumping truckloads of revenue into the "bailout" so fast that we've kind of lost count anyway! But there's always more where that came from, even if we end up just PRINTING the stuff.
But when it comes to funding so-called "Entitlement Programs"-- a term that has acquired a pejorative cast as the Compassionate State was dismantled in favor of the Hollow State-- politicians clap on the green eyeshades and squeal like stuck pigs about how costly and unproductive it is to prop up the lazy and worthless.
OK, even if they don't actually express the latter point, it's certainly true that when it comes to deciding whether to provide 7, 13, or 20 additional weeks of unemployment compensation to the rapidly swelling ranks of the unemployed, our politicians suddenly become parsimonious and resolve not to bleed the taxpayer one drop more than absolutely necessary.
And yes, the issue of benefit fraud & abuse is a well-worn gong that is tolled constantly, along with occasional tempests in a teapot about some miscreant or criminal receiving benefits due to some bureaucratic screw-up. Small local newspapers are prone to feature stories, or scathing editorials, of such ostensible scandals.
So, right you are!
· Yr Obd't Servant
An appropriate parable may be drawn from the climax of Charlie Chaplin's "Monsieur Verdoux," when the title character bitterly commented, "Numbers justify."
I believe it was kivals who said bring back the guillotine. Let's do it! Make these kinds of corporate war crimes punishable by death by beheading. Take everything from these pigs. Leave them penniless, Mercedesless, Rolexless, Botoxless, mansionless . . . and then execute them publicly and on live tv. That might get their attention.
I was daydreaming this morning, listening to the latest financial news, and picturing a road with each lamppost displaying a hanging body with a sign around its neck noting 'justice for greedy and selfish exploiters'....
We, each of us, have our visions.
"Why Hasn’t Obama Targeted The Ongoing White Collar Crime Wave?"
_____________________________________________
Um, because Obama IS the Ongoing White Collar Crime Wave?
· Yr Obd't Servant
Needed: A New Commission to Hang Corporate Criminals and Bribe Taking Officials.
Disenfranchisemend of Corporations to Follow!
I would submit to you that replacing a selfish and elitist form of governance and commerce with socialism will inevitably ensue. But to turn ones back upon any sort of progress is simply to display a negativism and elitism of your own.
As we currently live in a democratic republic we are doomed to gradual change. Regulated capitalism is step forward and the gradual insertion of socialism is a better strategy than armed insurrection.
"Why Hasn’t Obama Targeted The Ongoing White Collar Crime Wave?"
Why? Because that is a bottomless pit, a pandoras box, it is the rule not the exeption.
Open your eyes.
I suppose there is a very slim chance that this current economic disaster will bring the need for govt regulation to the fore. But how about the investigations into the collusion between govt and corporation that has been so rampant for decades, is accepted so readily and has led inevitably to our current predicament?
To effect meaningful change this would need to be one of the US Government's largest departments and warrants a cabinet secretary to oversee it.
Sioux Rose
RED RICK: You hit the issue, but will the guards consent to exposing their own culpability?
What struck me in this article is the romantic notion of taking so many "experts in corporate crime" off the domestic trail and instead sending them off into the netherlands of fighting terrorism. All this evil, love of money notably one of its root causes, but the wisdom of the Bush administration was to send the experts off elsewhere, to clear the way for the biggest bank heist in mankind's history. Kind of reminds one of fighting evil over there, rather than seeing its ugly distorted presence within the confines of our own homeland. Alas, the dark magicians understand all too well the power of sleight of hand and how it requires getting the "audience" to focus on the "wrong" diversion.
Diabolical distortions have engineered policies in homage to mammon (the banking caste) and Mars (the warriors/MIC); it will take time and pain to unravel them for they go right to the weave of American culture. As so much falls into collapse around us, the bright side is the realization something healthier will in time come to replace what was rotten to the core.
Each one teach one....We can win this thing.
Good comment. We can win some things very soon if we keep up the energy. From my recent experience, I believe that the average person is as angry as the people on this site. So in addition to listening and teaching, it would be good to motivate or organize one heretofore inactive person to do something they have never done before.
Joe
I have always been a "political loudmouth" at my work. I work among a horde of so-called "rednecks", and my company employs 23,000, many in construction of varying sorts so there are a bunch of working class guys. I have never been afraid to speak my mind and I have never before made such headway or seen so many heads nodding in agreement.
The times are changing and as Malcolm once noted "the chickens are coming home to roost"....