Bankers are too big to jail, and Americans are too stupid to stop them

Why are these banksters free?

Because you simply can't mess with these guys. They are too big. They will destroy you if you mess with them.

There oughta be a law. But too many of the voters of America won't support it. They simply aren't well enough educated to know what's in their best interest. It kind of makes you wonder if our failing education system might not be, up to a point, at least, a tactic by the the elite to keep their power. And they even get the superficially liberal teachers union to buy into it. How? Small favors.

Members of the poor and middle classes of America admire the rich and powerful--no matter how they got their money and power.

Who's more greedy, the rich or the poor who vote to protect them? The right-wing poor think they're going to be rich, and they want to make sure they won't have to share with their current neighbors by paying taxes when they do get rich. They'd be smarter to support a flourishing middle, with the poor working their way up to the middle. That was the situation we had just a few decades ago.

(Note: part of the problem is the failure to vote by many low income citizens, and the tactics used by the rich to keep them from voting.)

See: Scientific study says we are an oligarchy

VIDEO: "The Untouchables"
VIDEO: A parody of Lanny Breuer's response is posted

Too Big to Jail
By David Cay Johnston
NEWSWEEK
April 16, 2014

Bankers behind the subprime collapse are lucky Congress and the White House refused to call in the one man who knows how to nail them.

When fraudulent banking nearly sank the global economy in 2008, one former government official knew exactly how to nail the crooks. And he'd already swooped in to clean up a similar mess.

More than two decades ago, during the savings and loan crisis, Bill Black exposed the Keating Five, senators who took big campaign contributions from the most infamous of the savings and loan executives and then tried to hide their crimes by stopping bank examiners from doing their job. The scandal ended the careers of three of those senators. One of them—John McCain—went on to run for president.

Black also helped prosecutors convict more than 3,000 crooked bankers, a third of them high-level executives. He also trained bank examiners and FBI agents in what to look for and showed prosecutors how to frame charges and present complicated evidence to juries in a compelling manner.

After that, Black, a lawyer, got a doctorate in criminology and developed a theory he calls "control fraud" to describe how corrupt bankers turn legitimate institutions into criminal enterprises. He devised techniques to help bank regulators quickly spot crooked banking practices, and rolled all this into a book,The Best Way to Rob a Bank Is to Own One.

With a track record like that, you might think Black would have been the first person President Barack Obama called when he took office five years ago as the economy was being gutted because of reckless and rapacious banking practices that plundered profits through subprime mortgages and devilish derivatives. A second Great Depression was stalking America, as the stock market was tanking and businesses small and large were hemorrhaging jobs.

The economy is still recovering from those cynical depredations, and many people are still wondering why no one has gone to jail for pushing us all to the brink of ruin.

But to this, day no one in the White House or the Justice Department, no one in the banking regulatory agencies, will return Black's calls. In 2012 he did get invited to brief Capitol Hill staffers on fraud by banks. He bought plane tickets to D.C. from Kansas City, Mo., where he teaches law and economics at the University of Missouri's law school there. But before the plane took off his phone rang. "I was told not to come," Black recalls. "The staff said they were afraid I would engage in too much bank bashing."

Federal officials say they have no need of Black's expertise because the FBI is diligently investigating crooked banks. They say that without providing any evidence that they have successfully completed any significant cases. Or are even doing much of anything.

In December 2011, after being buffeted by complaints that no one had gone to jail for nearly bankrupting the country, President Obama said on 60 Minutes, "Some of the most damaging behavior on Wall Street—in some cases some of the least ethical behavior on Wall Street—wasn't illegal." Black called me then, asking how the declaration, which he regarded as at best woefully uninformed, could get past the serious journalists who work on that show.

When Obama's explanation didn't quell the protests, the White House decided to pretend to flex its muscle. Attorney General Eric Holder announced in October 2012 that an interagency task force had generated 530 criminal charges for bank crimes involving more than $1 billion.... And then publicists at the Justice Department stonewalled reporters who asked for details, names and case numbers.



Black said then that Holder's boast was hooey—and said it again when the attorney general repeated the claim last year. And now the Justice Department's inspector general has issued a report that proves Black was right, that Holder and the Obama administration did nothing to prosecute those who racked in billions through illicit banking practices.

When the inspector general asked to see those 530 cases Holder claims to be so proud of, he saw "numerous significant errors and inaccuracies." The inspector general reported last month that "despite being aware of the serious flaws in these statistics," Holder and the Justice Department continued to cite them.

The report also notes that in 2009 Congress gave the FBI an additional $196 million to investigate mortgage fraud. However, the inspector general says, "the number of FBI agents investigating mortgage fraud as well as the number of pending investigations decreased" over the next two years.

Mortgage fraud became "a low priority, or not listed as a priority, for the FBI field offices we visited, including Baltimore, Los Angeles, Miami and New York," the report says. The extra money allotted to bust the perpetrators of the subprime meltdown was diverted elsewhere.

The Justice Department now admits it has brought only 107 criminal cases, not 530, and those misdeeds involved a paltry $95 million. Not one case involved any of the so-called "too big to fail" banks.

After a contrite Holder admitted while testifying before the Senate last year that he feared prosecuting the big banks would damage the economy further by impeding the recovery, some took to calling them the "too big to jail" banks. Black concurs.

He also says that it would have been easy to nail many of the "too big" players. He insists he could have landed big fish by the thousands instead of the few minnows the Obama administration so halfheartedly pursued.

What's Morality Got to Do With It?

The richly and luridly detailed report of the Financial Crisis Inquiry Commission, which Congress created and whose report it tossed unread into the round file, shows that fraud was open, deliberate and endemic in the financial world prior to the 2008 crisis.

The big questions: Why did Justice ignore those big fish? And did Obama and Holder lie to the American people, or were the misinformed?

A disturbing answer begins with an FBI announcement in 2004, years before the crisis. The nation's premier law enforcement agency said it had uncovered a growing problem with fraudulent mortgages and had taken on a partner to combat these crimes. That partner was the Mortgage Bankers Association, the trade association for banks that make such loans.

In announcing this partnership, the FBI said that—with help from its new partners—it would pursue two types of crimes. One fraud they would be chasing was borrowing money for a property the buyer could not afford in the hopes of quickly selling it at a higher price. The other was to living in a nicer house than the borrower could afford until foreclosure, which can take months or sometimes years.

Note that both of those types of fraud are directed at individuals, and there is no mention of fraud by banks. "The FBI accepted the mortgage bankers' view," Black says, "and explicitly rejected the fact that some banks were committing frauds against their customers and investors who bought fraudulent mortgages."

At the time the FBI partnered with the bankers to "investigate" mortgage fraud, the chief White House economic adviser was Gregory Mankiw, a Harvard economist on leave. At a 1993 conference on such frauds at the Brookings Institution, Mankiw had already declared that of course bankers steal from institutions when conditions are right. "Given the incentives that regulators set up, it would be irrational for operators of the savings and loans not to loot," he said.

Black calls that "Mankiw morality," and points out that high-level government officials have their own incentives to look the other way.

The Revolving Door Reward Black now commutes to Kansas City from suburban Minneapolis, where his wife of 33 years, June Carbone, an authority on family issues, holds an endowed chair at the University of Minnesota law school. He says the FBI and regulators can easily spot control frauds by scrutinizing disclosure statements sent to bank regulators and investors. The indicators: Extremely rapid growth of loans issued at above-average interest rates to borrowers with little or no equity and shrinking reserves for loans that go sour. The control fraud must eventually come to an end because bad loans will start souring. As insiders see the horizon race toward them, they press workers to issue loans faster and faster, with fewer and fewer limits so they can pocket as many fees, stock gains and bonuses as possible before the enterprise collapses. Another of Black's indicators of control fraud is inflated appraisals, which justify loaning more than a property is worth, sometimes several times more. Black notes that in the early 2000s more than 11,000 real estate appraisers signed petitions to federal bank regulators complaining that appraisers who gave honest estimates were blacklisted by big banks in favor of appraisers who overstated values. "How much more obvious an alarm did bank examiners and the FBI need?" Black asks, breaking into a smile. "But did anybody do anything? Nooooooo." Black says the FBI had witnesses galore eager to testify against fraudulent practices by the big banks, and this was confirmed in a January 2013 Frontline documentary called "The Untouchables". Correspondent Martin Smith asked Lanny Breuer, then Holder's chief of criminal prosecutions, why PBS was able to find many people who knew of bank crimes and were eager to testify, but Justice had not prosecuted a single high-level insider. Breuer replies that although he found Wall Street riven with "abominable greed," he lacked the proof beyond a reasonable doubt that "makes a criminal case." A parody of Breuer's response is posted at a website maintained by Black's colleagues at the University of Missouri-Kansas City law school. In it, Breuer says, "If I contact people who have firsthand knowledge of fraud, I am going to have to follow up! "Look at my suit," the parody voice continues, "if I prosecute the most powerful people in the world, what will be left of my career? Nothing. Nada.... I have a stellar career ahead of me if I use the revolving door in Washington properly. If I go after bankers, I'm going to end up like Bill Black, marginalized, an assistant professor at some small university somewhere.... " Black, a ruddy-faced man of 62, chuckled when I ask him about the parody video. It is true, he says, that he hasn't managed his career as shrewdly as he might have were he only looking to get rich. "I've created all sorts of obstacles to getting anyone to hire me or even listen to me," he says, smiling. "That's what happens in America these days when you just tell the truth and point out the obvious."

Voting machines tied to the Romneys could decide the election in Ohio

Voting machines tied to the Romneys could decide the election in Ohio
a publication of Working Assets
October 22, 2012

Could a voting machine company with deep financial ties to the Romney family help Republicans steal the presidential election in Ohio?

It could happen. If this year's presidential election comes down to the electoral votes in Ohio, the deciding votes could be cast on electronic voting machines manufactured by Hart Intercivic.

Tell the Department of Justice: Don't let Republicans steal the election in Ohio with Romney-owned voting machines.

A 2007 study conducted by Ohio's Secretary of State showed that Hart Intercivic's touch screen voting machines could be easily corrupted. The New York Times reported:

At polling stations, teams working on the study were able to pick locks to access memory cards and use hand-held devices to plug false vote counts into machines. At boards of election, they were able to introduce malignant software into servers.1

Hart Intercivic is majority owned by H.I.G. Capital which controls two of the five seats on the Hart Intercivic board. An investment fund with deep ties to the Romney family and the Mitt Romney for president campaign, H.I.G. Capital was founded by Tony Tamer, a major bundler for the Romney campaign, and it is one of the largest partners of Solamere Capital, an investment fund founded by Tagg Romney and Spencer Zwick, Mitt Romney's chief fundraiser from the 2008 presidential campaign.2 This makes the Romney family part owner of the voting machine company, through it's interest in H.I.G. Capital.

Tell the Department of Justice: Don't let Republicans steal the election in Ohio with Romney-owned voting machines.

What's more, three other H.I.G. Capital directors are major fundraisers for the Romney campaign, and H.I.G. Capital is the 11th largest contributor to the Mitt Romney campaign.3 Two of the company's directors, Douglas Berman and Brian Schwartz, were even in attendance at the Boca Raton fundraiser4 where Romney infamously declared:

There are 47 percent of the people who will vote for the president no matter what... who are dependent upon government, who believe that they are victims, who believe the government has a responsibility to care for them, who believe that they are entitled to health care, to food, to housing, to you-name-it... These are people who pay no income tax...[M]y job is is not to worry about those people. I'll never convince them they should take personal responsibility and care for their lives.5

And as if the ties between Tagg Romney's Solamere, Romney contributors at H.I.G. Capital, and Hart Intercivic weren't astonishing enough, two members of Hart Intercivic's 5-member board of directors made direct contributions to the Romney campaign.

That's right. Directors of the company that makes touchscreen voting machines that could decide the presidential election in Ohio, have made contributions to the Mitt Romney for President campaign.

It is disturbing and dangerous that Hart Intercivic, the company that makes the machines that will count many of the votes in Ohio on election night has deep financial ties to family members of Mitt Romney. And that its leadership has been actively involved presidential campaign by donating and bundling hundreds of thousands of dollars to the Mitt Romney. The fact that these machines are easily corruptible touch screen voting machines makes matters even worse.

Gov. Mitt Romney and President Barack Obama are locked in a tight election race which could very well be decided by Ohio's 18 electoral votes. We must take action now.

Thank you for all you do to protect the integrity of our Democracy.

1. Bob Driehaus, "Ohio Elections Official Calls Machines Flawed," New York Times, December 15, 2007.
2. Rick Ungar, "Romney Family Investment Ties To Voting Machine Company That Could Decide The Election Causing Concern," Forbes, October 20, 2012.
3. "Mitt Romney (R) Top Contributors." Open Secrets, October 1, 2012.
4. Dave Gilson, Who Was at Romney's "47 Percent" Fundraiser?, Mother Jones, Sept. 18, 2012.
5. MoJo News Team, "Full Transcript of the Mitt Romney Secret Video," Mother Jones, September 19, 2012. Sign the petition

Potential voter registration fraud in Florida: GOP’s own 'ACORN' scandal?

Colo. girl registering ‘only Romney’ voters tied to firm dumped by RNC over fraud
Eli Stokols
FOX 31 Denver
September 28, 2012

The Colorado Republican Party has terminated its contract with a firm hired to run voter registration and get-out-the-vote operations here after allegations of fraud, FOX31 Denver has confirmed.

The move came at the recommendation of the Republican National Committee, leading to the termination of contracts with Strategic Allied Consulting in seven swing states, following an investigation of voter fraud by the company in Florida...

In Colorado, the state GOP has spent $466,643 — roughly half its total budget — with Strategic Allied Consulting, the firm in question.

Already this year, the RNC has funneled more than $3.1 million to the company, just formed in June by Nathan Sproul, an Arizona voting consultant who has run other firms that have been accused of dumping registration forms filled out by Democrats and other improprieties aimed at helping Republican candidates.

And FOX31 Denver has confirmed that the young woman seen registering voters outside a Colorado Springs grocery store in a YouTube video, in which she admits to trying to only register voters who support Mitt Romney, was indeed a contract employee of Sproul’s company...

Strategic Allied Consulting was hired to do voter registration drives in Florida, Virginia, Colorado, North Carolina and Nevada, and had been planning get-out-the-vote drives in Ohio and Wisconsin, Sproul told the Los Angeles Times Thursday.

Reports from the Federal Election Commission show that Sproul’s other company, Lincoln Strategy Group, has been paid more than $80,000 by the Romney campaign to help register voters between November 2011 and March 2012 during the GOP primary season.

Sproul told the Times he formed Strategic Allied Consulting at the request of the RNC for publicity’s sake, given past negative media coverage of Lincoln stemming from past allegations going back to 2004, when employees in Nevada and Oregon signed up Democrats but threw out their forms instead of turning them in.

Sproul has also been linked to signature fraud this election cycle in his home state of Arizona where he was working on a ballot initiative that would allow the state to nullify any federal laws it finds to be unconstitutional.

In Florida, the state GOP fired Strategic Allied Consulting on Tuesday after election workers in Palm Beach County discovered numerous registration forms that appeared to be filled out in the same handwriting, some including wrong addresses and birthdays...


Florida GOP Election Fraud scandal spreads to ten counties
*UPDATED x3 with CO Tie-in*
Daily Kos
SEP 28, 2012

...This is sort of like our ACORN story - except that ACORN actually reported fraudulent or suspicious registrations whereas Strategic Allied Consulting has been systematically trying to engage in voter registration fraud in order to add fictitious and/or redundant GOP voters to the rolls. Disgusting.

...Third Update: As someone downthread has correctly pointed out, the young lady from El Paso County, Colorado (Colorado Springs) who was only registering Republicans was indeed working for this Strategic Alllied group - that is, Nathan Sproul's group.

And FOX31 Denver has confirmed that the young woman seen registering voters outside a Colorado Springs grocery store in a YouTube video, in which she admits to trying to only register voters who support Mitt Romney, was indeed a contract employee of Sproul’s company.

“I’m actually trying to register people for a particular party,” the girl tells a woman in the video, which has been viewed more than 417,000 times. Because we’re out here in support of Romney, actually.”


Potential voter registration fraud in Florida: GOP’s own 'ACORN' scandal?
By Patrik Jonsson
The Christian Science Monitor
September 29, 2012

Saying the party has “zero tolerance” for voter fraud, the GOP also filed complaints against the company with the Florida Secretary of State’s office. The company, run by long-time GOP operative Nathan Sproul, says a single employee was responsible for the forged signatures, though the problem, by Friday, had spread to 10 counties.

"This is an issue we take extremely seriously," RNC spokesman Sean Spicer told CBS News. "When allegations were brought to our attention we severed all ties to the firm."

While reasonable, those explanations could have trouble finding traction among the US electorate, which has watched battles erupt in mostly swing states from Florida to Ohio over control of voter rolls, and heated debates about potential disenfranchisement of key Democratic constituencies, poorer, minority, and elderly voters.

Why do Election 2012 swing states matter? 5 resources to explain.

The allegations are particularly poignant in Florida, which decided the presidential race in 2000 after a massive recount was halted by the US Supreme Court in a way that gave the election to the GOP, and where the current Republican state administration has fought with the US Department of Justice over an effort to weed out illegal immigrants from the state’s voter rolls.

Even more to the point of third-party voter registration contractors, the League of Women Voters sued Florida earlier this month after it instituted a new 48-hour deadline for turning in registration forms. The state relented, reinstating a 10-day deadline.

What’s more, the fraudulent registration findings have echoes of the 2008 controversies over the now-disbanded ACORN community activism group, which was accused by Republicans in 2008 of falsifying forms.

Brad Friedman, who runs the electoral watchdog Brad Blog, helped break the story, tying it to other emerging GOP registration controversies in California and Colorado. Other states where Sproul’s firm had been hired to gather registrations have not reported any problems.

“A massive GOP voter registration scheme, which appears to involve the upper-echelons of the national party, [has begun] to emerge,” Mr. Friedman writes.

At the center of the controversy is Mr. Sproul, a long-time GOP campaign operative, whose firm has faced allegations of questionable tactics in the past, including changing or throwing out registration forms filled out by Democrats.

Quoted by Lee Fang of the nonpartisan Republic Report, former Rep. Chris Cannon (R) of Utah, during a voter fraud hearing, admitted that “the difference between ACORN and Sproul is that ACORN doesn't throw away or change registration documents after they have been filled out.”

Mr. Sproul has worked for a string of Republican presidential campaigns, including Mitt Romney’s. He was recommended to the Florida GOP by the National Republican Committee. Until being fired Tuesday, Sproul’s company had received $1.3 million from Republicans, including nearly $700,000 from the Florida Republican Party...

Ex-lobbyist Paul Magliocchetti charged with campaign-finance fraud

Ex-lobbyist Paul Magliocchetti charged with campaign-finance fraud
By Dan Eggen and Maria Glod
Washington Post Staff Writer
August 6, 2010

Paul J. Magliocchetti was one of the most powerful and influential lobbyists in Washington not too long ago, known for steering campaign contributions to favored lawmakers while securing millions of dollars in projects for his clients.

On Thursday, the former defense lobbyist stood accused by federal prosecutors of orchestrating one of the largest campaign-finance frauds in U.S. history. He faces devastating testimony from his son and has checked himself into a Baltimore clinic for anxiety.

Magliocchetti, 64, the founder and owner of the now-closed PMA Group, was charged in U.S. District Court in Alexandria with eight counts of illegal campaign contributions and three counts of making false statements. He is accused of funneling hundreds of thousands of dollars to lawmakers to enhance his firm's stature and business prospects.

His 34-year-old son, Mark, pleaded guilty in the same Alexandria courthouse Thursday to one charge of making illegal campaign contributions at the behest of his father, whom he portrays in a sworn statement as the mastermind of the scheme...