The Big Banks Are Corrupt – And Getting Worse

By Richard Eskow

The Justice Department’s latest settlement with felonious big banks was announced this week, but the repercussions were limited to a few headlines and some scattered protestations.

That’s not enough. We need to understand that our financial system is not merely corrupt in practice. It is corrupt by design – and the problem is growing.

Let’s connect the dots, using news items from the past few weeks:

The Latest Sweetheart Deal

Four of the world’s biggest banks pleaded guilty to felony charges this week, agreeing to pay roughly $5.6 billion in fines for fixing the price of currencies on the foreign exchange market. Justice Department officials made much of the fact that, unlike previous sweetheart deals with Wall Street, this one required the banks’ parent companies to enter a guilty plea.

That’s an improvement over previous deals. But it’s not as significant as it might have been, since the settlement wasn’t finalized until the banks were able to strike side agreements with regulators to ensure they’d be able to keep doing business as usual.

One of the institutions involved in this deal was Citigroup. That’s the bank whose self-written and self-serving “Citigroup amendment” passed Congress last December, a move which made it the target of an epic Elizabeth Warren takedown.

Another was J.P. Morgan Chase. Chase CEO Jamie Dimon was lionized for far too long by politicians and members of the mainstream media, many of whom insisted that Dimon was smarter and more ethical than his peers. There is now a considerable body of evidence to contradict that assertion – and it keeps on growing.

All four of these banks are repeat offenders with long records of serial fraud, as even this outdated graphic shows.

In A Related Development …

A fifth bank, UBS, was forced to give up a deferred prosecution deal as a result of its involvement in currency exchange fraud. In “deferred prosecution” agreements the Justice Department agrees not to prosecute a bank for crimes it has committed if it keeps a promise not to commit those crimes again. It was not clear whether this would lead to any real-world consequences for the bank, however.

In yet another related development, Bank of New York Mellon Corporation agreed this week to pay $180 million to settle a foreign exchange-related class-action lawsuit. This followed a $714 million settlement for writing pension funds and other institutional clients by overcharging them for currency transactions.

J.P. Morgan Chase – Again

This one seemed to slip through under the public’s radar. In a development that will trigger severe déjà vu for anyone who’s been following the big banks’ foreclosure scandals, the serially criminal J.P. Morgan Chase agreed on March 3 to pay more than $50 million over “robo-signed” documents – that is, documents that the bank fraudulently submitted to courts in mortgage-related hearings.

From the Wall Street Journal:

” … Bank officials admitted to filing more than 50,000 payment-change notices that were improperly signed, under penalty of perjury, by persons who hadn’t reviewed the accuracy of the notices, according to Justice Department officials.”

Telling a court you’ve reviewed a document when you haven’t? That’s perjury.

The Journal also noted that the Justice Department found that “more than 25,000 notices were signed in the names of former employees or of employees who had nothing to do with reviewing the accuracy of the filings.”

Again: perjury.

Many people lost their homes unjustly as a result of this mass-produced fraud. The practice was so widespread at J.P. Morgan Chase that it required the hiring of untrained college-aged temps – referred to within the organization as “Burger King kids” – to generate all the fraudulent paperwork.

This is where we’re obliged to insert a sentence that has long been superfluous when reporting on deals of this kind:

The Justice Department did not announce the indictment of any individual bankers for the crimes that led to this settlement.

Corrupt, And Getting Worse (more…)

As Patriot Act Expiration Looms, Critics Hope for Sunset on Mass Surveillance

With a deadline for the USA Patriot Act fast approaching, Congress has little time to decide how to proceed—but the call to ‘sunset’ the law is growing. (Photo: Dan Cook/flickr/cc/with overlay)

‘Together we will end the Patriot Act, and the sun can rise on a new day filled with freedom and privacy for all.’

By Nadia Prupis and Deirdre Fulton

With the fate of the USA Patriot Act still hanging in the balance late afternoon Friday—and lawmakers eager to leave Washington, D.C., for Memorial Day barbecues and campaign stops in their home states—the chance to see the sun go down on the controversial spying bill is still on the table.

The debate over the Patriot Act is centered around one of its key provisions, Section 215, which is set to expire on June 1 absent congressional action. The U.S. National Security Agency (NSA) previously relied on Section 215 to justify its mass phone data collection operation, but its expiration would force an end to that program.

With that “sunset” approaching, lawmakers have the chance to reform the Patriot Act, end it altogether, or pass a clean re-authorization that renews all the provisions set to expire in mere days.

Senate Majority Leader Mitch McConnell (R-Ky.) is the most outspoken supporter of a clean re-authorization, arguing that the Patriot Act in its current form is a crucial tool in the so-called “War on Terror.” FBI director James Comey also said this week that it would be a “big problem” to lose the authority that the law bestows on the intelligence agencies.

Adding to the urgency is the Obama administration’s warning that Congress only has until Friday to act on the law, because the government will need time to scale down its phone data program if it is not re-authorized. The House of Representatives has already left for the Memorial Day weekend.

The White House, along with the U.S. House, supports reform legislation called the USA Freedom Act, and warned that “there is no Plan B, these are authorities Congress must legislate.”

Should the Senate fail to pass the reform bill, said White House press secretary Josh Earnest on Friday, there is nothing the president can do to stop the Patriot Act provisions from lapsing.

Of course, that would be just fine with privacy activists and advocacy groups who oppose intrusive government surveillance. At protests held in dozens of cities on Thursday, demonstrators called on Congress to oppose any re-authorization of the Patriot Act and instead let its spying provisions sunset as scheduled on June 1.

“It’s time we came together and let the sun go down on this dark age of government surveillance,” said Fight for the Future campaign director Evan Greer. “Together we will end the Patriot Act, and the sun can rise on a new day filled with freedom and privacy for all.”

Free Press Action Fund government relations manager Sandra Fulton added, “The nationwide sunset vigils have sent a signal to Washington: It’s time we closed this chapter on mass surveillance and restored everyone’s rights to connect and communicate in private.”

However, The Hill reported Friday that “momentum appeared to be on the side of reformers, whose hopes were buoyed by the near certainty that the Senate will either need to pass [the House version of] the USA Freedom Act, or allow three parts of the post-9/11 law to sunset.”

The report went on to say the USA Freedom Act “has the backing of the majority of the Senate—including all Democrats—but it remains unclear whether it has the 60 votes necessary to overcome procedural hurdles during what increasingly looks like a rare Memorial Day weekend session.”

The USA Freedom Act passed the House on May 14 with an overwhelming 338-88 vote. But according to advocacy groups like the Electronic Frontier Foundation, the USA Freedom Act is a “small step instead of a giant leap,” particularly in comparison with previous iterations of the bill, introduced in 2013 and 2014, which offered stronger reforms but failed to progress through Congress.

The Act grants a five-year extension to Section 215.

After the bill passed the House, Tiffiniy Cheng, co-founder of Fight for the Future, warned that the USA Freedom Act would actually “expand the scope of surveillance” by the NSA and others.

“This is a fake privacy bill,” Cheng said. “Corrupt members of Congress and their funders in the defense industry are attempting to package up their surveillance-powers wishlist and misleadingly brand it as ‘USA Freedom.’ This is disappointing and offensive, and we will continue to work to kill this bill and any other attempt to legitimize unconstitutional surveillance systems.”

Opposition to the Patriot Act has grown steadily since whistleblower Edward Snowden in 2013 revealed Section 215’s role in the NSA spying program. The call to let the provision expire only grew after a federal appeals court ruled earlier this month that the agency’s phone surveillance operation is illegal. And as Mike Masnick at Techdirt points out, a Justice Department investigation into the FBI’s use of Section 215, released Thursday, found that the provision has never been particularly useful in anti-terrorism efforts.

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Shameful Texas Court of Criminal Appeals wimps out in Keller day care case

The Texas Court of Criminal Appeals embarrassed itself recently by refusing to find Dan and Fran Keller innocent of charges that they sexually molested children in their Austin day care center in 1992. Fortunately for the Kellers, however, the court finally did overturn their wrongful convictions after they had served 22 years in prison. It had little choice since there was no credible evidence that any of the children in their care had been sexually abused after Dr. Michael Mouw, the ER doctor who provided the only physical evidence corroborating the accusers, recanted his testimony after attending a medical conference and discovering his medical diagnosis was mistaken.

The Keller case was one of many satanic witch hunt prosecutions during the 80s and 90s that were initiated by the twisted imaginations of sexually fevered therapists, social workers, police and prosecutors who were adept at using leading questions to get young children to agree to false accusations. Jody Seaborn reports,

Without a finding of innocence, Dan and Fran Keller remain victims of a great injustice. It’s stunning to consider how credulously police and prosecutors fell for the incredible. Under leading and suggestive questioning by therapists, investigators and their parents, several children who attended the day care the Kellers ran in Southeast Austin told tales of videotaped orgies, of murder and dismemberment by chainsaw, of cats and dogs tortured and killed, of shark-filled swimming pools and a mutilated gorilla in Zilker Park, of corpses dug up and desecrated. The children also told stories of blood-soaked satanic rituals and of day flights to Mexico, where soldiers molested them before they were flown back to Austin in time to be picked up by their parents from the Kellers’ day care.

This case is very similar to the Wenatchee Sex Ring prosecutions in Washington State in the mid 90s. I have personal knowledge about it because I recruited 40 lawyers in the Seattle area and organized them into 17 teams assisted by law students from Innocence Project Northwest at the University of Washington School of Law. Each team was assigned to an innocent client who had wrongfully been convicted of swapping their children for sex during satanic orgies conducted in a church basement. We were successful in getting all of our clients released from prison.

As in the Keller case, the only evidence that corroborated the fantastical accusations by children in the Wenatchee case was provided by an incompetent ER doctor who did not know what he was talking about.

Another similarity was the stubborn refusal of therapists, social workers, police and prosecutors to admit the defendants were innocent. The Texas Court of Criminal Appeals sided with them despite the fantastical nature of the accusations, the use of improper child interrogation techniques  and the absence of any evidence that supported them.

The Kellers spent 22 years in prison for something they did not do and their reputations have been destroyed. The cowardly refusal of the Texas Court of Criminal Appeals to set the record straight is shameful and disgusting.

They probably sympathized with the state officials who believed the Kellers were guilty and they wanted to protect them from being sued.

 

 

 

 

US Sending Weapons To Iraq To Use Against Weapons US Previously Sent To Iraq

It’s almost like war is a business. The Pentagon announced on Thursday that the United States would be sending 2,000 AT-4 anti-tank rockets to Iraq. While the Department of Defense emphasized that the rockets were being sent to help combat suicide car bombs, there is another target anti-tank rockets might be needed for in Iraq these days – US tanks and other vehicles in the hands of ISIS.

That’s right, while ISIS is mostly made up by local reactionaries living out a fantasy from the 7th century the weapons they now have in their possession are cutting edge tech. After the Iraqi army first collapsed ISIS gained control of numerous US weapons and vehicles sent to the Iraqi army including modern US tanks. The kind you might need anti-tank rockets for.

Now with the recent fall of Ramadi to ISIS forces the militants have a new cache of US weapons:

The ISIS fleet of captured U.S. military vehicles, including M1A1 tanks, grew by more than 100 when Iraqi Security Forces (ISF) fled the provincial capital of Ramadi 60 miles west of Baghdad and abandoned their equipment , Pentagon officials said Tuesday.In addition, “there were some artillery pieces left behind,” said Army Col. Steve Warren, a Pentagon spokesman, but he could not say how many.

About 100 wheeled vehicles and “in the neighborhood of dozens of tracked vehicles” were lost to ISIS when the last remaining Iraqi defenders abandoned the city of about 500,000, Warren said. The tracked vehicles were mostly armored personnel carriers but “maybe half a dozen tanks” were in the mix, Warren said. He did not say what type of tanks they were. Photos posted by ISIS on social media purported to show about 10 M1A1 Abrams tanks in their possession and large amounts of captured ammunition.

Well this is an interesting game – send weapons to Iraqi army which loses US weapons retreating from ISIS, then send more weapons to Iraqi army to fight now better-armed ISIS only to retreat again and lose more US weapons to ISIS. Rinse, repeat, and consider buying defense stocks.

But don’t worry, the US military will also be attacking some of the US military equipment – ISIS won’t get it all right away. But look on the bright side, now we have somewhere to send all those tanks that the Pentagon did not want but Congress demanded be produced.

And you thought Washington didn’t have a jobs program.

The Roundup for May 21st, 2015

We make our next stop to Senegal. All done with finals. Now I can fully focus on the site while tying up some loose ends. The bourgeoisie lost. Their finals didn’t stop me.

International Politics

Overall

Part three of three with scholar Norman Finkelstein who explains, despite a falling out between President Barack Obama and Israeli Prime Minister Benjamin Netanyahu, why the U.S. is committed to defending Israel

– Attorney Michael Ratner joins The Real News to provide updates with Julian Assange’s case

– Ali Abunimah: “France launches new UN effort to undermine Palestinian rights

– President Obama: We are not losing the fight against the Islamic State in Iraq; Also, Obama said he is personally invested in a deal with Iran

– In addition, Obama said Tunisia was a non-NATO ally of the U.S. and, as a result, will receive $500 million loan

– Glenn Greenwald: “In the Same Week, the U.S. and U.K. Hide Their War Crimes by Invoking ‘National Security‘”

Middle East

– For folks living in Baghdad, even a walk down the street can mean life or death

– In Israel, authorities locked a community behind a steel gate because they live in the West Bank (more…)

Over Easy: Placeholder

Hummingbirds arriving in NW PA, apple blossom time
Hummingbirds arriving in NW PA, apple blossom time

As there isn’t an Over Easy yet, I’ll put this up just for folks to meet and share things here with.

The Antartic Peninsula, from a report from Bristol University that was just released, has been losing ice in dramatic quantities.

Satellites have seen a sudden dramatic change in the behaviour of glaciers on the Antarctica Peninsula, according to a Bristol University-led study.

The ice streams were broadly stable up until 2009, since when they have been losing on the order of 56 billion tonnes of ice a year to the ocean.

Warm waters from the deep sea may be driving the changes, the UK-based team says.

(snip)

“Around 2009/2010, the surface in this part of the southern Antarctic Peninsula started to lower at a really quite dramatic rate, of 4m per year in some places. That’s a pretty big signal,” said Bristol’s Prof Jonathan Bamber.

“The total loss of ice per year is about 60 cubic km. Just to put that into some kind of context: 4 cubic km is roughly equivalent to the domestic water supply of the UK every year.”

Late Night FDL: Who Are You

The Who – Who Are You

The Who had best avoid Denver and Seattle during their US leg…

Roger Daltrey Doesn’t Want Fans Smoking Pot at Who Concerts

Boy, how things have changed since the ’60s. Roger Daltrey threatened to stop a Who concert last night after he smelled pot smoke in the audience.

According to Newsday, the band was playing a show at New York’s Nassau Coliseum yesterday when an abundant amount of weed smoke started to make itself to the stage. Apparently, the singer is allergic to marijuana smoke and it causes his voice to stop working.

You can see Daltrey scold the audience member with the wicked bud in the above video. He asks him to stop puffing or he would walk offstage. Then Pete Townshend gets a few words in too, before the fan apparently put away his stash and let the band continue on with its 50th-anniversary tour show.

Newsday‘s review notes that “the smoke’s impact was almost immediate on his voice, which went from crystal clear and potent for the opening ‘I Can’t Explain’ to something rougher and more limited during ‘I Can See for Miles.’”

Townshend’s been in a particularly prickly mood lately. Earlier this week, he released a new solo song, “Guantanamo,” about the Cuban prison camp where alleged torturing occurred following one of the wars the U.S. has been involved in over the past few years. In the song (which is from an upcoming solo compilation), he spits his words and hasn’t sounded this angry since that time he kicked a cop.

The Who’s 50th anniversary tour continues through November, with dates in North America and Europe. Townshend also has a special gig on July 5 in London, where his 1973 rock opera Quadrophenia will be performed by a classical orchestra.

What’s on your mind tonite…?

Growing Global Inequality Gap ‘Has Reached a Tipping Point’

‘When such a large group in the population gains so little from economic growth, the social fabric frays and trust in institutions is weakened.’

By Nadia Prupis

With the gap between the rich and poor growing worldwide, a new study by the Organization for Economic Cooperation and Development (OECD) published Thursday suggests that the only way to reverse such rampant inequality is by implementing government measures aimed at balancing the playing field

Chief among those measures: Tax the rich and push for gender equality.

In its 34 member states, income inequality has reached record highs, the OECD found in its study, In It Together: Why Less Inequality Benefits All. The average income of the top 10 percent was 9.6 times higher than the bottom 10 percent, the OECD found. In the U.S., it was 19 times higher.

“We have reached a tipping point,” said OECD secretary-general Ángel Gurría. “The evidence shows that high inequality is bad for growth. The case for policy action is as much economic as social. By not addressing inequality, governments are cutting into the social fabric of their countries and hurting their long-term economic growth.”

“In recent decades, as much as 40% of the population at the lower end of the distribution has benefited little from economic growth in many countries,” the study found. “In some cases, low earners have even seen their incomes fall in real terms. When such a large group in the population gains so little from economic growth, the social fabric frays and trust in institutions is weakened.”

Working conditions have also deteriorated, largely due to the rise of a “non-standard” economy that incentivizes part-time work, self-employment, and temporary contracting.

“Between 1995 and 2013, more than 50 percent of all jobs created in OECD countries fell into these categories,” the OECD stated in a press release on Thursday. “Low-skilled temporary workers, in particular, have much lower and instable earnings than permanent workers.”

However, the study found that an increase in the number of women working “helped stem the rise in inequality, despite their being about 16% less likely to be in paid work and earn about 15% less than men.”

Inequality is highest in Chile, Mexico, the United States, Turkey, and Israel. It is lowest in Denmark, Slovenia, Slovak Republic and Norway.

Higher inequality also drags down economic growth by making opportunities more scant for the bottom 40 percent and often preventing low-income children from receiving quality education, or enough of it. The long-term rise of inequality “has indeed put a significant brake on long-term growth,” from developed nations to emerging economies, the OECD found.

“If the bottom loses ground, everyone is losing ground,” the report states.

The OECD recommends a wide range of solutions to reverse the growing wealth gap, including removing the obstacles that prevent mothers from working; doing more to provide youth with useful skills and allow workers to continue updating those skills over time; and redistribute wealth through taxes and transfers, which the report describes as a “powerful instrument to contribute to more equality and more growth.”

“In recent decades, the effectiveness of redistribution mechanisms has been weakened in many countries,” the OECD states. “To address this, policies need to ensure that wealthier individuals, but also multinational firms, pay their share of the tax burden.”

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MENA Mashup: The Truth About Libya Emerges

Very early in the Libyan fiasco I’d smelled a rat on our real intentions in Libya… ‘Intervention – Disaster For Libyans’

‘Al-Qaeda bogeyman of choice for West’

Press TV: There’s always talk of al-Qaeda bogeyman whenever there is any report on Yemen in the Western media. Yet this al-Qaeda affiliate was very quiet since the start of the revolution in Yemen. What does that show?

Steinberg: Al-Qaeda is the buzzword to justify any kind of criminal activity imaginable from military intervention to brutal suppression of a genuinely popular and peaceful revolt against a corrupt and completely bankrupt regime and of course the Saudis in particular have carried out a whole series of brutal campaigns violating the borders of Yemen over a long period of time using this al-Qaeda pretext.

It is noteworthy that according to Colonel Gaddafi in Libya the two main sources of the uprising there are the CIA and Osama Bin Laden so it is almost getting to be comical that this bogeyman is used to justify all kinds of illegal behavior. We are going to find out at some point in the very near future the Saudis are engaged in massive “rendition operations” going into certain neighborhood in Bahrain and picking people off the streets and this is a desperate effort on the part of [Persian] Gulf Cooperation Council countries to basically hold onto these Sunni regimes. It is not going to hold. Either there are going to be some very genuine and legitimate and verifiable concessions or one after the other these regimes are going to go under. The Libya situation has become more complicated by the fact that it is about the American and European interest in Libyan oil.

So that situation is somewhat different when you have a much larger criminal violation going on right now. The whole terms under which the UN Security Council resolution, which was halved with abstention rather than vetoes from Russian and china, has been proven to be a complete sham. The discussion among American and European leaders from day one was not about the humanitarian aid to the people in Benghazi but it was regime change, plain and simple. President Obama went on national television on Monday night and knowingly and systematically lied through his teeth about the nature of the operation was there. So al-Qaeda is the bogeyman of choice for justifying violation international law, and human rights and everything else.

As I noted over a year ago in my Benghazi, Benghazi, Benghazi post… (more…)

Nigerian President-Elect Seeks to Shift Investment From Oil to Other Sectors

Nigerian President-Elect Muhammadu Buhari, who beat incumbent Goodluck Jonathan and will take office on May 29, pledged to invest more resources into other sectors of the economy like agriculture instead of relying on oil.

Buhari believes such investments will provide much-needed jobs for Nigerians, especially amid the massive drop of oil prices:

In the economy, we have to quickly turn to agriculture and mining because that is where you can do the quickest work and earn results.

In terms of oil exports, Nigeria is a top producer with the country being Africa’s largest petroleum producer. Moreover, it holds the most natural gas reserves out of all African countries.

In addition, Nigeria is a member of OPEC after joining in 1971. The country depends so much on oil and gas that it “accounts for about 35 percent of [the nation’s] gross domestic product.”

Although, being the country with the most oil includes some downsides such as corruption. Indeed, The Wall Street Journal reported on June 19, 2000 how, in spite of their profitability, resources, including oil, have been a clutch for African nations such as Nigeria.

‘With the advent of oil, the government lost its initiative,’ sighs Chidi Duru, a Nigerian lawmaker who blames the oil feeding frenzy for the decline of the country’s once-prosperous farm economy. ‘In a sense it has become a curse, not a blessing.’

Recently, allegations arose that the previous administration, under President Goodluck Jonathan, took $20 billion from oil revenues. Ngozi Okonjo-Iweala, the country’s finance minister, denied it ever occurred.

Nigeria also depends on energy imports because its refineries are not reliable enough to fuel the country. For a country once believed to be the next Saudi Arabia or Kuwait when oil was discovered in the 1950s, oil has failed to develop the country, even though it accounts for as much as 25 to 30 percent of the country’s GDP.

In 2005, crude oil production peaked at 2.4 million barrels per day, yet “began to decline significantly as violence from militant groups surged, forcing many companies to withdraw staff and shut in production.” (more…)