Thursday, October 30, 2014

Wall Street Banks Already Breaking Law Again, Violating Settlements With Prosecutors


By:  Thursday October 30, 2014 8:00 am

Brace yourself for an epic shock – Wall Street is breaking the law again. After a couple of years of questionable compliance with legal settlements the banksters are now straight up violating the terms of the deals prosecutors and regulators struck as an alternative to criminal charges. Apparently, as has been argued by everyone not dim or bought, settlements do not work to stop criminal behavior. Something prosecutors seem genuinely surprised by as they are having to reopen old settlements because the banks are back to their old tricks.
If nothing else it should be entertaining to watch prosecutors excrete yet another ridiculous explanation for why they will not be bringing criminals charges against the rich and powerful. Though the Too Big To Jail cover story is going to be hard to top in terms of comedic value.
Prosecutors in Washington and Manhattan have reopened an investigation intoStandard Chartered, the big British bank that reached a settlement in 2012 over accusations that it transferred billions of dollars for Iran and other nations blacklisted by the United States, according to the lawyers briefed on the cases. The prosecutors are questioning whether Standard Chartered, which has a large operation in New York, failed to disclose the extent of its wrongdoing to the government, imperiling the bank’s earlier settlement…
As reported earlier by The New York Times, prosecutors are also threatening totear up deals with banks like Barclays and UBS that were accused of manipulating interest rates, pointing to evidence that the same banks also manipulated foreign currencies, a violation of the interest rate settlements. The prosecutors and banks have agreed to extend probationary periods that would have otherwise expired this year.
Would any other group of criminals get this kind of treatment? These people have been caught breaking the terms of a deal they agreed to after breaking the law. This corruption is hitting new levels of absurdity every day.
At this point it is rather obvious that trying to rein in Wall Street through the legislative process is futile. Wall Street is not only breaking laws already on the books, they are breaking those laws even after being caught doing so. Maybe prosecutors should just say Wall Street is above the law and end the charade.

Saturday, October 25, 2014

Gretchen Morgenson on Why Banks Are Still Too Big To Fail


The New York Times columnist tells Bill that, five years after the country’s economic near-collapse, banks are still too big to fail, too big to manage, and too big to trust.

Wednesday, October 22, 2014

Top Firm Accused of Rigging Mortgage Mods, Foreclosures


from aol

The Associated Press    Oct 22nd 2014 10:03AM

Ocwen Subprime Mortgages

Benjamin Lawsky, superintendent of the New York State Department of Financial Services, detailed allegations in a letter to Ocwen.
By Alex Veiga

One of the nation's largest servicers of home loans may have denied struggling borrowers the chance to fix loan problems and avoid foreclosures, New York's financial regulator has alleged. An investigation by the state's Department of Financial Services found that Ocwen Financial Corp. inappropriately backdated foreclosure warnings and letters that rejected mortgage loan modifications, making it nearly impossible for borrowers to appeal the company's decision.

Many borrowers who had fallen behind on loan payments also received warning letters months after the deadline for avoiding foreclosure had passed, department investigators found. Potentially hundreds of thousands of backdated letters may have been sent to borrowers, likely causing them "significant harm," Benjamin Lawsky, New York's Superintendent of Financial Services, wrote in a letter to Ocwen released Tuesday.

"Ocwen's indifference to such a serious matter demonstrates a troubling corporate culture that disregards the needs of struggling borrowers," Lawsky wrote in the letter to company's general counsel. In a statement, Atlanta-based Ocwen blamed software errors in the company's correspondence systems for generating improperly dated letters.

The latest claims of wrongdoing against Ocwen come less than a year after the company agreed to reduce struggling borrowers' loan balances by $2 billion as part of a settlement with federal regulators and 49 states over foreclosures abuses. It's the most recent evidence that many of the same kinds of abuses that made the housing crisis and the Great Recession worse are still happening some seven years after the housing bubble burst.

Subprime mortgage lenders thrived during the real estate boom years, as many borrowers turned to a variety of nontraditional, riskier loans when they couldn't qualify for traditional, fixed-interest mortgages requiring down payments. But it all began to unravel in 2007, as defaults started to pile up. That eventually triggered a mortgage meltdown that sent foreclosures soaring and propelled the U.S. housing market into its worst skid in decades.

In the years since, companies like Ocwen have been enlisted to handle payment collection on behalf of banks and, in many cases, investors who own securities backed by bundled home loans. They also handle customer services, loan modifications and foreclosures.

Such companies have also been criticized for not helping homeowners quickly enough -- resulting in delays that lead to more fees and profits for servicers. Many have been the target of consumer lawsuits. Some mortgage-servicing companies processed foreclosures without verifying documents.

Ocwen is the fourth-largest mortgage servicer in the country and the biggest that isn't a bank. It specializes in servicing high-risk mortgages. At the start of this year, it managed $106 billion worth of subprime mortgages, according to Inside Mortgage Finance, a mortgage industry tracker

The New York Department of Financial Services launched a probe into Ocwen in August amid allegations that the company overcharged struggling homeowners on a product called force-placed insurance, which servicers force borrowers to buy if they don't maintain voluntary homeowners' insurance. If mortgage borrowers don't pay up for newly purchased insurance, Ocwen forecloses on their homes.
Among its latest findings, the regulator determined that Ocwen failed to investigate the backdating of its letters to borrowers nearly a year after an employee raised questions about the practice.

The letter did not specify whether the backdating was intentional or the result of poor oversight by Ocwen. "The existence and pervasiveness of these issues raise critical questions about Ocwen's ability to perform its core function of servicing loans," Lawsky wrote in the letter.

In its statement, Ocwen said initially that its systems generated improperly dated letters to 283 of its borrowers in New York. It later said it is aware of additional borrowers, but didn't specify..
The company added that it is investigating two other cases and cooperating with the New York regulator.

"We believe that we have resolved the letter-dating issues that have been identified to date, and we continue our investigation as to whether there are additional letter-dating issues that need to be resolved," the company said.

A company spokesman did not immediately respond to a request for details on how many Ocwen borrowers nationwide received backdated letters or lost their homes as a result of the delayed warning letters. Ocwen's stock slumped $4.78, or 18.2 percent, to $21.48 Tuesday. The stock is down 61 percent this year.

Josh Boak in Washington contributed to this report.

Tuesday, October 21, 2014

When Banksters Buy Regulators and Prosecutors

from forbes

Laurence Kotlikoff 

Two of our nation’s top attorneys, Helen Chaitman and Lance Gotthoffer, just released Chapter 3 of their riveting and free book, JPMadoff – The Unholy Alliance Between America’s Biggest Bank and America’s Biggest Crook. All Americans concerned about financial fraud and the role of our regulators and politicians in sustaining financial fraud need to read this book at
The book, which incorporates exclusive interviews with Bernie Madoff, focuses on JP Morgan Chase ’s 20-year role in laundering money for Madoff. Money laundering, as everyone knows, is a big-time criminal offense. Yet no one at JP Morgan Chase (JPMC) who was involved, year after year, in taking in Madoff’s huge client deposits and watching him transfer them to a small number of special “clients” rather than invest them in the securities he claimed he was buying, bothered to pick up the phone and inform anyone in law enforcement. Indeed, according to the authors, the New York office of JPMC failed to report anything amiss even after its London office conveyed an explicit warning that Madoff was perpetrating a fraud.
If you have a brokerage account you really need to look closely at as well as my columns on SIPC’s brokerage insurance scam, starting with Close Your Brokerage Account, which are posted at
According to a recent NY Times column, a new Ponzi scheme is being uncovered every four days. Your broker may seem and be perfectly honest, but his/her firm may have some very bad apples that are putting the entire operation and your own account at terrible risk. And don’t count on SIPC’s brokerage “insurance.” It actually puts you at triple jeopardy. If you spend enough of the money that you’ve accumulated in your account you stand to a) lose all your remaining assets, b) lose all SIPC insurance coverage, and c) be sued by SIPC for up to every penny you withdrew in the six years before the fraud was discovered.
You might think that parking your money in a big bank like JP Morgan Chase would insulate you from fraud. It’s just the opposite. The big banks are the biggest perpetrators of financial fraud – fraud that affects millions of us, either directly or indirectly, on an ongoing basis. While they are wrist slaps when properly scaled, you can see the list of “settlements” made between the government and the big banks here. These “settlements,” the aftermath of Wall Street’s near production of a second Great Depression, entailed not a single criminal indictment. The top two repositories of banksters, based on the number of settlements, are Bank of America BAC +1.41% and JP Morgan Chase.
The banks engage in fraud for two reasons. First, they profit from swindling the public. Second, they can get away with it via a simple technique. They buy off the regulators with promises of enormously lucrative jobs when they leave government service and they buy off the politicians with huge direct and indirect campaign contributions. Chapter 3 of, aptly entitled All in the Family, documents how this all works in very fine detail.
Many of the conclusions that the authors draw about who did exactly what and when they did it are necessarily speculative because it’s very rare to find smoking guns when it comes to financial fraud and government malfeasance. We are left with a listing of extremely disturbing facts by the authors and an invitation to draw our own conclusions. Here’s an example in the authors’ words.
From 2001 to 2005, Stephen Cutler was Chief of the SEC’s Division of Enforcement. In that position, he ignored repeated complaints that Bernie Madoff was running a Ponzi scheme. When Madoff’s scheme finally collapsed in 2008, an SEC Enforcement attorney testified that it took only “a few days” and “a phone call … to [Depository Trust & Clearing Corporation] to confirm that Madoff had not placed any trades with his investors’ funds.” In 2006, only 14 months after leaving the SEC, Cutler became general counsel of JP Morgan Chase with a compensation package in excess of $10 million annually. Even with that, Cutler did not report Madoff’s criminal activities to the federal government, as required by the Bank Secrecy Act. In fact, he waited until after Madoff confessed to file a suspicious activity report. As if the government needed the information at that point!
The authors also draw connections between a) Preet Bharara – the United States Attorney for the Southern District of New York, who decided to press no criminal charges against JPMC, b) the support by JPMC, by other big banks, and by Madoff, himself, of Bharara’s former employer, Senator Charles Schumer, and c) Schumer’s close relationship to Bharara, who was Schumer’s chief counsel and who, according to the authors, was appointed to his U.S. Attorney position in 2009 thanks to the sponsorship of the Senator.
The authors have no evidence that Senator Schumer had anything directly to do with Preet Bharara’s failure to criminally prosecute anyone at JPMC for money laundering. But the financial ties between Wall Street and Schumer and the personal ties between Schumer and Bharara (who, the authors believe, is being promoted by Schumer to replace Eric Holder as our chief law enforcement officer) raise eyebrows.
The good news with respect to Senator Schumer is that he is clearly standing up to Wall Street’s “brokerage insurance” company – SIPC, which has a) denied insurance coverage to most Madoff victims and is suing large numbers of innocent Madoff victims for spending money they were told they’d earned, b) denied brokerage insurance coverage to all Stanford victims, and c) denied brokerage insurance coverage to all McGinn-Smith victims.
Madoff, Stanford, and McGinn-Smith are the three huge Ponzi schemes discovered in the past five years. Collectively, they wiped out the finances of roughly 10,000 Americans, mostly retirees. SIPC let all three criminal operations lure in innocent victims with the promise of SIPC insurance protection. But when these frauds were discovered, SIPC decided to renege on virtually all of its insurance protection promises. Why? Because SIPC was, itself, running a scam, in this case an insurance scam. It had been collecting essentially zero insurance premiums from the big banks and was in no position to cover its insurance obligations.
Together with Senator David Vitter, Senator Schumer is sponsoring theRestoring Main Street Investor Protection and Confidence Act. Passage of this bill would not only force SIPC to actually fulfill its insurance commitments to Madoff, Stanford, and McGinn-Smith victims. It would also prohibit SIPC from suing any of us who a) invest in a brokerage account, b) do well, and then c) do what SIPC apparently thinks is criminal — withdraw and spend the principal plus investment income we are told we’ve earned.
JPMadoff — the Unholy Alliance Between America’s Biggest Bank and America’s Biggest Crook is a book you must read. It’s also a book you get to read in real time. Authors Chaitman and Gotthoffer are posting new chapters as they write them. From what I understand, they have many more shockers to disclose in their forthcoming chapters.
How will the book end? That depends, in large part, on how hard Senator Schumer fights for the little guy – the average American who can’t hire people at $10 million a year to protect his interests and ends up being swindled, first by Ponzi schemers and then by SIPC.

Thursday, October 16, 2014

Spanish High Court Orders Ex-Bankers to Deposit Millions

from reuters

Spain’s High Court on Thursday gave two former senior executives at bailed-out lender Bankia and its predecessor Caja Madrid three days to hand over several million euros as it investigates claims of misuse of company credit cards. Rodrigo Rato, chairman of Bankia up until its state rescue in 2012, was asked to deposit 3 million euros ($3.84 million) with the court to avoid having his assets blocked, the court said. Mr. Rato’s predecessor Miguel Blesa, who used to run Caja Madrid, was told to pay 16 million euros. The two ex-bank chiefs have been accused of improper management by magistrates investigating allegations that dozens of former executives used company credit cards for personal expenses like clothing, food and trips.

Monday, October 13, 2014

Chaos and noise cover the fraud and crime of the paper money system


Posted on 
Dollars pile as background
Every person in the U.S. and in the world is now face-to-face with impoverishment at the hands of the paper money creators.
All paper currencies throughout history have become worthless. They are created to eventually become worthless. The only periods in history when paper money is stable for any length of time is when it is backed by gold at a set exchange rate. U.S. currency was completely and finally removed from the gold standard by President Nixon, who created the “Nixon shock” by ending the Bretton Woods agreement in August 1971.
Banksters, governments and politicians love paper money simply because it is a means of aggrandizement, wealth and power at the expense of the people. The people produce and save. The banksters, the government and the politicians steal the peoples’ savings and production with paper money. Every new dollar the banksters create is a dollar stolen from you.
You know that the government creates money through the Federal Reserve by printing money. And I described to you last week how the banks create money out of thin air in my column “How banks and the government rob you blind.”
This deception has gone on for years, and the people are unaware. Why and how can this deception work to the destruction of millions and billions of people for so long? The answer:
  1. We are born into the system. Most people never question the system that they are born into.
  2. The destruction of paper money is gradual. Anything can be accomplished over time. Only a very few people become alert to what is happening.
  3. Noise: What is noise? Noise is constant bombardment by the system on the human psyche. Anything that keeps the mind from focusing is a form of noise. There are many distractions like war, pandemics, terrorism, political noise, weather, political scandals, etc.
For example, the current Ebola “crisis” is noise and a scam. Ebola cases are currently confined to a specific area of Africa — an area that has experienced decades of war and the detonation of chemical and possibly small-scale nuclear munitions and that has inadequate infrastructure, unsanitary conditions and little food. It is also the location of manufacturing facilities that are leaching toxins into the air, ground and water.
Malnourished, immunity-compromised people constant exposed to toxins are subject to a host of ailments that mimic the symptoms attributed to Ebola. The test that is used to diagnose Ebola is not even a reliable test. Who says? The Department of Defense said so in a manual titled “Joint Project Manager Medical Countermeasures Systems,” produced Aug. 14:
[The PCR test] should not be used as the sole basis for patient management decisions. Results [of the PCR] are for the presumptive identification of the Ebola Zaire virus (detected in the West Africa outbreak in 2014).
In other words, the PCR test may detect Ebola and it may not.
The inventor of the test says the same thing. Kary Mullis won the Nobel Prize in 1993 for inventing the PCR test. He says the test cannot determine how much Ebola is in the body. (Source: “Questioning the HIV-AIDS hypothesis: 30 years of dissent,” by Patricia Goodson; published in Frontiers in Public Health on Sept. 23, 2014.)
So we have Ebola, ISIS, Ukraine, illegal immigration and numerous Obama scandals. Dozens of things are occurring all at once to keep the people from reality: all noise. These diversions keep the public mind off the super fraud and crime of paper money. The crowd never wakes up.
  1. Finally, it is not credible to the public mind that government is organized crime supported by its monopoly of paper money. Government runs on paper money and deception. But people are indoctrinated from the beginning of life to trust the system.
But, Bob, you ask, why do you write so much about “money” when there is so much else going on in the world?
Discussion of the U.S. dollar is timely because there is so much paper money being created. This affects every man, woman and child. The policy of the U.S. government is to inflate (depreciate) the U.S. dollar. There is nothing that you could know or understand as important in your life and your finances as this.
Currencies can be destroyed by official and announced devaluation. They can be destroyed by unofficial and unannounced devaluation or depreciation. The public understands this as inflation or rising prices.
You readers who have been following us understand inflation as depreciation of the currency. Governments can steal and confiscate from the people more through the depreciation (printing paper money) of the currency than through military conquest.
Depreciation of the currency is done gradually and silently. The public is unaware until the final stages of inflation (depreciation). It is then too late to save their assets.
Not one person in a million suspects that his dollars are melting every day and that his dollar assets — his savings and retirements — are evaporating. Because it is gradual, no one gets upset.
The constant confusion and noise diverts the public mind away from government theft of our assets. Underneath lies that deep dark secret that the government gets everything for nothing. It’s all so simple.
The money creators “buy” with money that costs them nothing. But you can take these depreciating dollars and buy real assets like silver and gold while there is still time.
The source of all world chaos today is the escalation of the creation of paper money (credit). This is central to our thinking and planning. All that we do or all that we should plan to do is directly related to the systematic depreciation and destruction of the U.S. dollar and all dollar-denominated assets.
Our personal survival depends solely on our advanced knowledge and understanding of government’s scheme of inflating the currencies. We think dollars in everything we do. We need to transfer our thinking and our finances into gold, silver and commodities.
We have been through a long paper money era. We are now reverting back to hard money and a store of wealth.
We are seeing the inflationary expansion of the currency and the world of chaos being spun. Stability is giving way to quicksand. Morality is diminished and replaced by humanism. Politics is a mode of deception. This is what paper money finally does to the human experience.
I want to be perfectly honest with you. I wish I could tell you that events and history are random and political chance. I wish I could tell you that you should vote for political candidates and that you should believe in “democracy.”
But history is not chance or accident. It is organized crime parasitizing on millions of human pawns who live in fiction.
We have a great country but an illegal government that does not abide by the Constitution and the laws of the land.
Note: To better understand the true nature of the Ebola “crisis,” I urge you to go to and read Jon Rappoport’s excellent series on Ebola.

Sunday, October 12, 2014

Virginia Files Billion Dollar Suit Against Banksters


OCTOBER 11, 2014   AFP 


Virginia files lawsuit against plutocrats who conned state with toxic mortgages.
By Ronald L. Ray —
True to its state motto — “Sic semper tyrannis,” or “Thus always to tyrants” — the Commonwealth of Virginia has brought a $1.15 billion civil fraud lawsuit against a “banker’s dozen” of the largest international investment houses. Attorney General Mark R. Herring announced the case in mid-September, which was filed in Richmond Circuit Court. In a prepared statement, the Office of the Attorney General (OAG) alleged that the big banks deliberately misrepresented the quality of residential mortgage-backed securities (RMBS), a form of financial derivative, sold to the Virginia Retirement System (VRS), beginning in 2004.
Prior to 2010, “Virginia was forced to sell the vast majority of these toxic securities built on junk mortgages and lost $383 million.” The attorney general now seeks to obtain the maximum penalty allowed by law, in order to redress the harm done to Virginia taxpayers. The OAG expects that the money recovered will go to repay the taxpayers and VRS for their losses.
In a virtual “who’s who” of plutocratic pirates, 13 mega-banks have been accused of violating the commonwealth’s 2002 Fraud Against Taxpayers Act, which permits treble damages for losses, plus additional penalties.
According to the Richmond Times-Dispatch, however, two JPMorgan Chase subsidiaries, JPMorgan Securities LLC and WAMU Capital Corporation (formerly Washington Mutual), were dropped subsequently, when the OAG learned thatHerring’s predecessor, Kenneth T. Cuccinelli II, had previously reached a secret settlement with the two firms for $3 million. Depending on circumstances, however, they could be sued in the future.
The remaining “banker’s dozen” are subsidiaries of the world’s biggest institutional usurers: Barclays, Citigroup, Countrywide, Credit Suisse, Deutsche Bank, Goldman Sachs, RBS, HSBC, Morgan Stanley, UBS and Merrill Lynch.
In brief, Virginia alleges that 220 securities it purchased were offered as being rated AAA or similarly, with 0% delinquency. This factor is important to institutional investors like Virginia because of the need for a stable and secure return. However,75% of the mortgages eventually defaulted. The RMBSs were backed by 785,000 mortgages, of which 40% were “fraudulently misrepresented.” The OAG stated that the banks “knew, or should have known,” that claims in their prospectuses and sales presentations were false.
The fraudulent practices were discovered by Integra REC, LLC, “using extremely sophisticated proprietary methods” to match RMBSs with the respective individual mortgages, said the OAG.
The first of three main accusations is that the banks misrepresented the loan-to-value ratio (an indication of likely default). On average, only 23.4% of loans were represented as being for more than 80% of property value, when it was really 54%. Fifteen percent were “underwater.” Further, rates of owner occupancy were overstated significantly, and second mortgage numbers were severely understated. Both of these latter factors also contribute to delinquency rates.
Herring stated: “Every Virginian was harmed by the financial crisis. Homes were lost, retirement accounts were devastated, small businesses saw their credit dry up almost overnight. . . . I will not allow Virginians to be left holding the bag for the reckless, fraudulent business practices of a few big banks who thought they were above the law. These banks lied to Virginia, and taxpayers and [nearly 600,000] state employees lost hundreds of millions dollars as a result.”
As a measure of Herring’s confidence and resolve, the Commonwealth of Virginia has demanded a jury trial. It is to be hoped that true justice will be served, and that there will be no further secret settlements that allow the plunderous plutocrats to return to usury as usual.
Despite a nearly endless stream of revelations of the moneylenders’ wrongdoing—now including collusion by the Federal Reserve—at least one apologist for the weasels of Wall Street, Matthew E. Fishbein, suggests in the New York Law Journalthat the banksters and other corporate criminals are the victims, forced by evil government lawyers to admit to things they believe they did not do. He goes so far as to call cases similar to the Virginia lawsuit “marginal,” because they involve only a few hundred million dollars.
But the truth is that the international bankers are usurious pirates, bent on sucking every cent out of the nearly empty pockets of widows and orphans. They have created a corporate culture of corruption, which is destroying nearly every economy on the face of the planet. It is time to end the financial pharaohs’ stranglehold on the common man by ending usury and putting every single one of these predatory banks out of business.
Ronald L. Ray is a freelance author and an assistant editor of THE BARNES REVIEW. He is a descendant of several patriots of the American War for Independence.

Thursday, October 9, 2014

Financial Regulators Bend Rules for Banksters


Oct 08, 2014 - 04:29 PM GMT
The cozy relationship between financial institutions and their respective regulators has long been known. Concern from reformers and activists comes from all stripes of ideological perspectives. With the attention that Carmen Segarra, the whistleblower of Wall Street, has gained, the noise from the banking establishment pushes back. Here comes the expected spin from the Fed, The New York Fed Slams Tape-Recording Whistleblower, Says She Was Fired After Just 7 Months Over Performance. Read theirStatement Regarding New York Fed Supervision. So what is this controversy all about?

How dare a mere low level regulator document the goings on within the financial establishment, Inside the New York Fed: Secret Recordings and a Culture Clash, writes.
“As ProPublica reported last year, Segarra sued the New York Fed and her bosses, claiming she was retaliated against for refusing to back down from a negative finding about Goldman Sachs. A judge threw out the case this year without ruling on the merits, saying the facts didn't fit the statute under which she sued.
At the bottom of a document filed in the case, however, her lawyer disclosed a stunning fact: Segarra had made a series of audio recordings while at the New York Fed. Worried about what she was witnessing, Segarra wanted a record in case events were disputed. So she had purchased a tiny recorder at the Spy Store and began capturing what took place at Goldman and with her bosses.
Segarra ultimately recorded about 46 hours of meetings and conversations with her colleagues. Many of these events document key moments leading to her firing. But against the backdrop of the Beim report, they also offer an intimate study of the New York Fed's culture at a pivotal moment in its effort to become a more forceful financial supervisor. Fed deliberations, confidential by regulation, rarely become public.”

In an attempt at damage control, the Fed was looking for a favorable review. What they got was not what they wanted, N.Y. Fed Staff Afraid to Speak Up, Secret Review Found.
“The investigation, conducted by Columbia University finance professor David Beim, was initially confidential but was later released by the Financial Crisis Inquiry Commission.
Mr. Beim’s report called on the New York Fed to demand that its regulatory staffers maintain a “more distanced, high-level and skeptical view” of how the banks they oversee make money.”

A Short History of the Breathtaking Cluelessness of U.S. Financial Regulators, is outlined by the Motley Fool analysis. Any serious observer of the cozy relationships that permeate the financial community knows all too well, that the revolving door turns when favorable regulation decisions spin in the right direction.

The significance of this latest scandal, points out just how the regulation process is conducted in the suites of money manipulation. This next account is most telling; You Should Listen To The Goldman New York Fed Story.

“This American Life has a banking supervision story that turns on secret recordings made by a former employee of the New York Fed, Carmen Segarra, and it's pretty good, because it shows how regulators basically do a lot of their regulating of banks through meetings, with no action items after. That's weird, and it's instructive to see how intertwined banking and supervision are. There's a killer meeting after a meeting with Goldman Sachs where Fed employees talk about what happened, and - though we don't know what was left on the cutting room floor - the modesty of the regulatory options being considered is fascinating. Nothing about fines, stopping certain sorts of deals, stern letters, or anything else. The talk is self-congratulation (for having that meeting with Goldman) and "let's not get too judgmental, here, guys."
The takeaway of the story, which is blessedly not an example of the "me mad, banksters bad!" genre, is that this kind of regulation isn't very effective. It clearly hasn't prevented banks from being insanely profitable until recently, in a way that you'd think would get competed away in open markets.”

Why is Goldman exempt from any meaningful oversight? William D. Cohen over at Politico provides an answer to the question, Why the Fed Will Always Wimp Out on Goldman.
“Although Michael Silva, Segarra’s superior, didn’t doubt that the Goldman-Santander transaction was legal, he didn’t think it passed the smell test. “It’s pretty apparent when you think this thing through that it’s basically window dressing that’s designed to help Banco Santander artificially enhance its capital position,” he told his New York Fed team before a meeting on the topic with Goldman executives.”
Segarra thought her boss’s pre-occupation with whether Goldman “should” have done the deal, or been allowed to do the deal, was all just a big waste of time and obfuscated the larger issue that Goldman, and other Wall Street banks, were busy pushing around a key regulator – the New York Fed – rather than the other way around. She worried that her bosses were focusing on “fuzzy” and “esoteric” issues such as Goldman’s “reputational risk.” Silva also shared with Segarra that it was all moot anyway, because Tom Baxter, the New York Fed’s general counsel, had, he said, “reined him in” on the subject. “I was all fired up, and he doesn’t want me getting the Fed to assert powers it doesn’t have,” Silva tells Segarra, according to the tape recording.”

Breaking down all the details and dialogues that transpire in the normal course of banking reviews comes down to the undeniable fact that Goldman is in charge of the process. The ownership of the Federal Reserve, a private entity, is ultimately owned by the shadow families that control the major financial institutions. Only a very naïve analysis or a compromised minion of the financial elite Plutocracy would dispute the power and clout that is applied to the political nature of regulatory oversight.

Bankster’s earn this graphic title by the way they conduct their protection racket. Courageous regulators like Carmen Segarra are treated as traitors to a system that is designed to facilitate every abuse that firms like Goldman can devise. Now you know who really owns the gold, because they make up whatever rules that foster their financial corruption.

James Hall – October 8, 2014