FREE BERNIE MADOFF… FREE BERNIE MADOFF…
Over this past year or so, and especially last month, it feels as if weâ€™ve been treated to an overabundance of financial scandals.Â And I have to tell you that a friend of mine changed my perspective on these things, and Iâ€™m starting to feel much better about the situation as a whole.
1 – In the winnerâ€™s circle would have to be the one in which everyone has great INTEREST.Â Ladies and gentlemen, hereâ€™sâ€¦ LIBOR, which apparently stands for â€śLying In Between Other Reporting.â€ťÂ Said to be a multi-trillion dollar scandal, to-date weâ€™ve seen a CEO resign and a fine levied against just one bank, Barclays, for a little under half a billion.Â As to jail timeâ€¦ not a chance.
Of course, one bank out of 16 wouldnâ€™t be able to manipulate the LIBOR rate, which is the rate at which banks lend to each other, and with some now suspecting that others may be involved, whatâ€™s going to happen to the other 15 banks?Â Well, recent reports say that theyâ€™re looking to pursue an 49 AG type of group settlement with regulators, of course, so they can put this scandal behind them.Â And that, the smart money says, will be the end of that.
But, reallyâ€¦ who could have known something like this was going on?Â Itâ€™s not like anyone could have seen this coming and done anything about itâ€¦ right?Â Iâ€™m sure that we did what everybody else did, right?
2 – JPMorgan Chase comes in at number two this month, because it started out disclosing losses of over $2 billion from what was supposed to be a hedging strategy to reduce risk.Â A couple of weeks ago, however, the bank disclosed that the losses could exceed $7 billion, but beyond that, it seems the bankâ€™s traders may have lied to cover up the amount of the losses, although the business press phrased it as â€śintentionally tried to obscure.â€ť
With no one buying the values of the trades being disclosed by the bank, the company finally had to announce that its Q1 earnings were no longer reliable. Â Federal regulators are now considering whether JPMorgan employees lied about their losses with the intent to defraud investorsâ€¦ or, I suppose, whether they lied about how much theyâ€™d lost just for fun.
How big are our losses?Â I’d say about this big.
JPMorgan Chase doubled down this past month with an energy market rigging scandal involving power-market manipulation that is nowÂ being investigated by the Federal Energy Regulatory Commission (â€śFERCâ€ť).Â So far, the agency has had to ask the court to compel JPMorgan to produce emails it says the bank has been withholdingâ€¦ or provide a reason for withholding them.
The investigation is following up on reports submitted last year that describe bidding practices that California and Midwest system operators consider abusive.Â FERC says that based on estimates by the two system operators, three of the bidding practices combined to create improper payments of $73 million.
As to the potential for jail time in either case above?Â Nope, not happening.
3 – Coming in third on my list of this monthâ€™s marauders is the muni-bond market scandal, where it seems three former UBS executives helped deceive cities and towns all across this fair land by rigging bids to invest municipal bond proceeds.
ark ZaiThe prosecutionâ€™s star witness, Mno, testified that he and the three bankers on trial excluded aggressive bidders, solicited losing bids on purpose, and provided information to favored bidders in order to rig investing outcomes from the proceeds of municipal bonds.Â And so, I would have to sayâ€¦ very well done there.
I suppose some jail time could happen for three guys, but not much and not necessarilyâ€¦ maybe home jail with ankle bracelets and probation.Â UBS is too big to fail, and these guys are irrelevant, and undoubtedly almost as rich as Canada already.
Isnâ€™t is interesting how the Wall Street crowd always talks about how theyâ€™re risk takers, but given the chance all they seem to want is a sure thing?
4 – Fourth place is a scandal reminiscent of John Corzineâ€™s dalliances while CEO of MF Global, who by the way was a past recipient of the coveted, â€śInability to Recall Where $1.6 billion Went Without Going to Jail,â€ť award. Â How does he do it?Â Itâ€™s simple, really.Â Documents recently uncovered by the Government Accountability Institute reveal that MF Global was a client of U.S. Attorney General Eric Holder and Assistant Attorney General Lanny Breuerâ€™s former law firm, the irrepressibleâ€¦ Covington & Burling.
Of course, Iâ€™m talking about Peregrine Financial Groupâ€™s fraud, which has apparently been going on for decades and involves the disappearance without a trace of $1.2 billion.
The scandal at Peregrine Financial Group (â€śPFGâ€ť), which is now being investigated by regulators and in congressional hearings, was only brought to light with the assistance and dedication of the firmâ€™s founder and CEO, Russell Wasendorf, who left a suicide note describing how he had been stealing his customerâ€™s money, and then failed to successfully commit suicide.
For the length of his fraudulent scheme and the fact that he turned himself in, most believe him to be the favorite for this yearâ€™s â€śPonzi Award,â€ť which is a statue cast in the image of Bernie Madoff.Â This year, as I understand it, the Ponzis are being held at the Milken Pavilion and are being sponsored by the International Monetary Fund.
Jail?Â Not for Corzine, heâ€™s ex-Goldman.Â What about Wasendorf?Â Iâ€™d have to say, â€śOver his dead body.â€ť
5 – Next upâ€¦ further evidence that America is losing ground as a world leader, Wells Fargo Bank, the undisputed king of the drug cartel money laundering market since its acquisition of Wachovia in 2008, saw its dominance threatened recently by the Britainâ€™s largest bank, HSBC.
HSBC broke all previous records for money laundering by a commercial banking institution by adding terrorist funding and tax evasion to the bankâ€™s capabilities â€” totaling more than $30 billion in suspect transactions all linked to sanctioned companies in Iran, North Korea and Burma.Â While some have chosen to view these acts as being less than positive, rumor has it that, as a result, HSBC has been offered the part of the villain in the next James Bond movie.
HSBC executives were not just let off the hook scot-free this time around, however, a half dozen of the bankâ€™s executives were forced to appear before the Senate Permanent Investigations Sub-committee for an entire day where they were presented with a 335-page scrapbook-of-memories and given a stern talking to.
Wells Fargo has admitted that it failed to properly monitor and report on suspected money laundering by narcotics traffickersâ€¦ including cash used to purchase four airplanes that shipped a total of 22 tons of cocaine.Â And I hate to say it, but isnâ€™t that just another example of how American banks have gotten lazy and fallen behind in global competitiveness as a result.
I just hope that Wells Fargo and the other American-based global banking cartels learn from Wellsâ€™ mistakes, and recognize that had Wells Fargo been more vigilant about monitoring and reporting of all laundering activities, perhaps HSBC wouldnâ€™t have been able to take the lead, and it would be Wells Fargo starring in the remake of Goldfinger instead of the Limey bastards at HSBC.
Itâ€™s a painful lesson, to be sure, but if it wakes up the banks in this country, then itâ€™ll be worth it as we see America once again reclaim its rightful place as the money launderer of choice for drug cartels and terrorist organizations all over the world.
Jail? No way.
6 – Wells Fargo Bank did at least make an attempt at proving its evilness and despicability remain robust by discriminating against African-American and Hispanic borrowers in violation of fair-lending laws.Â In appreciation of the effort, the Justice Department allowed Wells Fargo to pay $175 million to settle the accusations, but alongside the $1 billion fine HSBC received, it was only a reminder to the management team at the San Francisco bank that it had a lot of work to do before it would be breaking those sorts of records once again.
7 – Even the nationâ€™s fifth-largest financial institution, US Bank, tried to get in on the act by allowing more than 150 foreclosed homes in Los Angeles to fall into disrepair, thus making the bank, “one of the largest slumlords in the city.â€ť Â Â While itâ€™s true that the fines could be over $100 million, thereâ€™s little hope among US Bankâ€™s executives that it will be able to challenge their larger competitors this year in terms of urban blight production.
No jail here either.
8 – Also, last month, in a totally unexpected development, Capital One settled charges brought by U.S. banking regulators, by agreeing to pay $210 million because its call-center personnel misled consumers into paying untold tens of billions for extra credit card products.Â As I understand it, the settlement agreement was welcomed by roughly a dozen Capital One executives who used copies of the agreement to help them renew their employment contracts, securing guaranteed record bonuses for the next three years.
Not even illegal, more likely revered.
9 â€“ Face factsâ€¦ NASDAQ trading malfunctions that occurred during the first few hours of trading, and last minute disclosures by analysts that adjusted down Facebookâ€™s revenue growth rates, combined to cause more than a 20 percent aftermarket decline in the price of FB shares, thus reminding investors that the acronym â€śIPOâ€ť really stands for, â€śItâ€™s Probably Overpriced.â€ť
10 – And, whether itâ€™s watching EU central bankers torture Spaniardsâ€¦ transform Greece into a cheap vacation destination for the Germans and Frenchâ€¦ or frighten the Italians into reconsidering fascismâ€¦ all while watching the Irish drink themselves into early graves to avoid lives of certain indentured servitude, watching the takeover of the world by irresponsible lenders considered too big to fail, jail or assailâ€¦ if viewed with the right perspectiveâ€¦ is sort of a hoot.
Itâ€™s kind of like watching the tigers, all vain and dressed in Little Black Samboâ€™s brightly colored clothes that he surrendered so that the tigers wouldnâ€™t eat him, as they chase each other around and around the treeâ€¦ until they are reduced to a pool of melted butter.
Remember how the story ends?Â The tigers lose.Â Sambo recovers his clothes and his mother makes pancakes with the butter.Â Mmmmâ€¦ good.
Oh, and one more thingâ€¦
Something occurred to me earlier and tâ€™s what got me motivated me to write this articleâ€¦ Bernie Madoff.Â Over 25 years, Bernie scammed $60 billion out of investors with his ponzi schemeâ€¦ then he turned himself inâ€¦ and so heâ€™s now in jail.
If I were himâ€¦ Iâ€™d be so pissed off at myself.Â I mean, Bernie must have realized it by nowâ€¦ he didnâ€™t really need to turn himself inâ€¦ because the way things have gone, after defrauding investors out of $60 billion, he might not have even been prosecuted.
Thatâ€™s what Bernie did wrongâ€¦ he gave up and turned himself in.Â No one goes to jail that steals billions in this country, let aloneÂ $60 billion.Â Bond trader, Howie Hubler cost Morgan Stanley about $9 billion in a day, if memory serves, and he went home with something like $40 million.
Letâ€™s start a movementâ€¦
Free Bernie Madoffâ€¦ Free Bernie Madoffâ€¦ Free Bernie Madoff!
If no one else is going to go to jail having to do with the financial meltdown, then I donâ€™t actually care if Bernie is in there either.Â I mean, if crime paysâ€¦ then letâ€™s embrace the change.Â Letâ€™s stop pretending and start rooting for the bad guysâ€¦ because theyâ€™re now the good guys.
Â Loop it and I’m good to go.
Itâ€™s the same way I feel about members of the U.S. Congress.Â Since theyâ€™re not going to accomplish anything, and theyâ€™re notâ€¦ Iâ€™d be fine if theyâ€™d just put C-Span on a loop so it looks like theyâ€™re in session, and then they could all take off for Florida, or Hawaiiâ€¦ or wherever theyâ€™d like.
They really donâ€™t have to fake it on my account, Iâ€™d rather see them all having a good time.Â As long as they remember what the Poet Laureate, Mr. Bob Dylan had to say,,,
Don’t wear sandalsâ€¦ try to avoid avoid the scandalsâ€¦ don’t wannaâ€™ be a bum, you better chew gumâ€¦ the pump don’t work ’cause the vandals took the handles.
Do you dig what heâ€™s saying there?
No, not really.
Itâ€™s blowing in the wind, babyâ€¦ the answer is blowing in the wind.