You might recognize a pattern. There is systemic fraud inside a corporation. Someone tries to blow the whistle. Their reward? Fired, their income lost and reputation ruined. Such is the fate of those who tried to do anything regarding the massive subprime mortgage fraud, a major underlying cause of the financial crisis.
CBS 60 Minutes asked the same question we've been asking since 2008, why aren't executives and the perpetrators of the crisis in jail? In spite of bringing the globe to her knees, criminal prosecutions are down 28.6% from just before this latest debacle.
It's like ground hog day in corporate crime. Nothing ever changes and the only ones punished are the ones with a conscience and the U.S. middle class and poor.
The transcript for the 60 Minutes report is here.
Comments
Justice Dept. and SEC Definitions of Fraud for Citibank etc
The Banksters universally fail the anti-fraud tests of SARBOX and SEC/1933-34.
The Enforcement Chief for the U.S. Department of Justice is using a legal standard of fraud not based upon the SEC Acts of 1933-34 and SARBOX. SARBOX enhances the anti-fraud provisions of original SEC law. The standard the Justice Department wants to apply is intentional falsity. The actual standard includes both willful misrepresentation and gross negilgence. Citibank, GS, AIG, BoA and many others fail the gross negligence test in valuation of securities in terms of Internal Controls.
Internal Controls are part of audit procedures since the 30's. The auditors must now certify under SARBOX. Essentially every financial, accounting and IT policy
and procedure must be designed and implemented in a way which assures the integrity of the financial statements, the integrity of managements control of the business (under the 1933-34 SEC/FASB test) and now must include all IT processes and procedures. Relevant to the Crisis is the failure to value mortgages, mortgage backed debt, and derivatives.
Why would Justice and the SEC apply a more rigorous legal test to the behavior
of management based upon intentional deception, so difficult to prove? Think of the IRS and Al Capone. The Feds got Capone on a tax rap because murder was so hard to prove. This is the reverse. If you want put the fix in and let your campaign contributors get buy, then you prosecute on a standard which will be difficult to prove and so the proecutors will lose. In other words, the fix is in.
Justice Department and SEC are Putting the Fix In for Friends
The Banksters universally fail the anti-fraud tests of SARBOX and SEC/1933-34.
The Enforcement Chief for the U.S. Department of Justice is using a legal standard of fraud not based upon the SEC Acts of 1933-34 and SARBOX. SARBOX enhances the anti-fraud provisions of original SEC law. The standard the Justice Department wants to apply is intentional falsity. The actual standard includes both willful misrepresentation and gross negilgence. Citibank, GS, AIG, BoA and many others fail the gross negligence test in valuation of securities in terms of Internal Controls.
Internal Controls are part of audit procedures since the 30's. The auditors must now certify under SARBOX. Essentially every financial, accounting , IT policy and procedure must be designed and implemented in a way which assures the integrity of the financial statements, the integrity of management's control of the business (under the 1933-34 SEC/FASB test) and now must include all IT processes and procedures. Relevant to the Crisis is the failure to value mortgages, mortgage backed debt, and derivatives.
Why would Justice and the SEC apply a more rigorous legal test to the behavior of management based upon intentional deception, so difficult to prove? Think of the IRS and Al Capone. The Feds got Capone on a tax rap because murder was so hard to prove. This is the reverse. If you want put the fix in and let your campaign contributors get buy, then you prosecute on a standard which will be difficult to prove and so the prosecutors will lose. In other words, the fix is in.
Burton Leed
A beautiful typo!
I don't know if it's an intentional or a fortuitous typo, but it's great and to the point --
"If you want put the fix in and let your campaign contributors get buy"
The country needs the Occupy Amendment
See also, for example, ThinkProgress article, 18 November 2011 --
Also see, Robert Oak blog (7 November 2011), Everybody Hates Jack Abramoff
GD commercials. I am not
GD commercials. I am not waiting a fukng minute to watch this video
Commercials on web videos
I agree, they suck, but on the other hand, they are way less than watching on regular broadcast. I think regular TV, esp. cable has to be majority commercials than actual content and less we not forget the product placements within the content.
They have to make money somehow to pay for the shows, so at least these are available and you don't have to be clued to your chair at 7pm Sunday, or own a Tivo to see them.
Countrywide and Citibank Systemic Frauds
The answer why there are no Justice Dept prosecutions is very simple, but no one cares.
In @ 2005, Harvard held a conference on the 50th Anniversary of Brown v. Board of Education.
Dean Kagan, now Supreme Court Justice Kagan in her Introductory Comments, noted that in attendance were two possible Presidential Candidates, Sen. Obama and Governor Spitzer. Larry Sommers, stood up and took exception to her comments, by stating that indeed, only one Presidential Candidate was in attendance, as Governor Spitzer had alienated Wall Street and could never become President without their financial backing.
With that, Governor Spitzer and his wife unceremoniously walked out!
Knowing this incident, can anyone seriously believe that President Obama would risk alienating Wall Street and thus jeopardizing his fund raising campaign for the 2012 Election?
This is fact, not fiction. Not until Holder and Obama are removed will there be any substantive effort to prosecute a bank.
Yes folks, politics as usual.