By William K. Black
This column was prompted by an unusual source for me. Cuenca High Life is a site for ex pats living in Ecuador. It often discusses serious issues of national importance. The three issues a recent volume discussed are all important economic issues and they have prompted a fourth economic issue I will discuss in this column.
By William K. Black
(Cross posted at Benzinga.com)
FBI Director Robert Mueller is taking his victory lap as he steps down after 12 years of service. I have done three articles in a series that explains how the Mortgage Bankers Association (MBA) conned the FBI into adopting the Tea Party’s mythology about the causes of the crisis – virginal banks beset by ultra-sophisticated fraudulent hairdressers. The MBA created a faux definition of mortgage fraud under which the bank and its senior officers were always the victims instead of the perpetrators.
Posted in William K. Black
Tagged accounting control fraud, banksters, FBI, mortgage fraud, Robert Mueller, white collar crime
This is my second column discussing Federal Reserve (Fed) regulation in the context of the question of who President Obama should appoint to be Ben Bernanke’s successor. This column focuses on the sudden discovery by economists (and, purportedly, Obama) that the Fed Chair’s most important function is to regulate. (If that sounds like common sense to you, (1) you are not an orthodox economist and (2) you do not understand the Fed’s culture.) This column begins the process of explaining why most of the economists and finance scholars (Robert Prasch is the exception) writing to urge that the new Fed Chair be chosen based on their regulatory skills demonstrate that they lack any understanding of the fundamentals of financial crises and supervision (and aiding prosecutions). This column begins my response to Amar Bhide’s op ed entitled “Wanted: A Boring Leader for the Fed.”
Posted in William K. Black
By Matthew Berg
If you have ever taken an introductory economics course – or any economics course* – then you have experienced the wonder and the majesty of stick figure economics.
Stick figure economics treats mankind as a representative homo oeconomicus – a person (and an economy) neatly stripped of all flesh, blood, and pesky three-dimensional idiosyncrasies.
The legal culture of big-time settlements can short-circuit the law, protecting wrongdoers from punishment, trial or even an admission of guilt. That’s just what the government has done for the major banks implicated in sweeping mortgage fraud. Is it too late to rectify the big banks role in the housing and financial crisis? Bill and other panelists speak with Alyona Minkovski on this subject.
The Sacramento Bee is a paper with a fine pedigree that just wrote a powerful editorial entitled: “Wall Street needs to be schooled in the rule of law.”
“When the president feels the need to call out his own people for not moving fast enough on new rules for Wall Street, you know that things have really bogged down.
That’s what Barack Obama did Monday, urging top financial regulators to get going on enforcing the Dodd-Frank law, passed by Congress three years ago but still adamantly opposed by big banks.
Wall Street’s freewheeling ways and outright fraud worsened the worst financial crisis this nation has faced since the Great Depression. Nearly five years later, many large financial institutions are making big profits again, but relatively few wrongdoers have seen the inside of a prison cell.
Precious little has truly changed.
Who gets the short end of the foot-dragging? The vast majority of Americans, of course, those who aren’t favored clients of Wall Street firms. You can bet we’re the ones who will be left holding the bag if there’s another crash because proper safeguards aren’t in place.”
Posted in William K. Black
Tagged accounting control fraud, banksters, mortgage fraud, too big to prosecute
The big banks are desperate to prevent Janet Yellen from being appointed as Bernanke’s successor to run the Fed. Their sexist attacks have backfired. On August 1, 2013, Deutsche Bank launched the single most absurd assertion to block Yellen’s appointment. Deutsche Bank wants Larry Summers, or better yet Timothy Geithner, to (not) regulate them because not being regulated effectively is its highest priority.
“To the extent that the job has become much more international and with more regulation and supervision within the new financial world order, that makes people such as Summers and former Treasury Secretary Tim Geithner compelling candidates,” says Deutsche Bank economist Joseph Lavorgna.
Posted in William K. Black
Tagged banksters, crony capitalism, Janet Yellen, Lawrence Summers, Timothy Geithner
By William K. Black
(Cross posted and Benzinga.com)
Introduction
This is the third column in my series discussing why the FBI and the Department of Justice (DOJ) have failed to investigate and prosecute successfully the largest and most destructive financial fraud epidemic in history. The series uses the FBI’s 2010 Mortgage Fraud report to tease out how the FBI and DOJ suffered such a defeat.
The MBA conned the FBI into a “partnership” with the trade association of the “perps.” In my prior column I showed the first product of the partnership – a poster warning customers not to defraud banks but ignoring banks defrauding customers. This column discusses the more consequential and damaging product of the FBI/MBA partnership. The MBA presented a definition of “mortgage fraud” under which the bank is always the innocent victim and never a perpetrator. Because the FBI and DOJ did not draw on the banking regulators’ expertise due to the death of criminal referrals by the agencies the FBI fell for the MBA con.
Posted in William K. Black
Tagged appriasers, banksters, FBI, MBA, Mortgage Bankers Association
This is the second in my series of articles based on the FBI’s most (2010) “Mortgage Fraud Report.”
In my first column I began the explanation of how many analytical conclusions one can draw from a close reading of what is left out of the FBI report.
In particular, I emphasized the death of criminal referrals by the SEC and the banking regulatory agencies. The FBI report implicitly confirms the investigative reporting of David Heath that first quantified the death of criminal referrals by the banking regulatory agencies.
Three Bloomberg reporters have done the Nation a service by ferreting out a scandal of moderate magnitude but emblematic importance. Dakin Campbell, Jody Shenn and Phil Mattingly broke the story on August 14, 2013 that Adam Glassner, recently described, but not named, in the Department of Justice’s (DOJ) fraud suit against Bank of America (B of A), and named as a defendant by Fannie Mae’s in its fraud suit against B of A and several officers, was hired by two companies (Ally and Fannie) bailed out by Treasury.
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