NO ADVERTISING, GOVERNMENT OR CORPORATE FUNDING

  • Latest News
  • Pitch a Story
  • Work with a Journalist
  • Join the Blog Squad
  • Afghanistan
  • Africa
  • Asia
  • Baltimore
  • Canada
  • Egypt
  • Europe
  • Latin America
  • Middle East
  • Russia
  • Economy
  • Environment
  • Health Care
  • Military
  • Occupy
  • Organize This
  • Reality Asserts Itself
  • US Politics


  • Black: Too Big to Prosecute and It's Obama's Fiscal Cliff


    Bill Black: Criminal money laundering goes unpunished and Fiscal Cliff was created by Obama -   December 23, 2012
    Members don't see ads. If you are a member, and you're seeing this appeal, click here

    Audio

    Share to Facebook Share to Twitter



    I support The Real News Network because I am tired of lies and biased journalism. Long live TRNN! - Roberto
    Log in and tell us why you support TRNN

    Bio

    William K. Black, author of The Best Way to Rob a Bank is to Own One, teaches economics and law at the University of Missouri Kansas City (UMKC). He was the Executive Director of the Institute for Fraud Prevention from 2005-2007. He has taught previously at the LBJ School of Public Affairs at the University of Texas at Austin and at Santa Clara University, where he was also the distinguished scholar in residence for insurance law and a visiting scholar at the Markkula Center for Applied Ethics.

    Black was litigation director of the Federal Home Loan Bank Board, deputy director of the FSLIC, SVP and general counsel of the Federal Home Loan Bank of San Francisco, and senior deputy chief counsel, Office of Thrift Supervision. He was deputy director of the National Commission on Financial Institution Reform, Recovery and Enforcement.

    Black developed the concept of "control fraud" frauds in which the CEO or head of state uses the entity as a "weapon." Control frauds cause greater financial losses than all other forms of property crime combined. He recently helped the World Bank develop anti-corruption initiatives and served as an expert for OFHEO in its enforcement action against Fannie Mae's former senior management.

    Transcript

    Black: Too Big to Prosecute and It's Obama's Fiscal CliffPAUL JAY, SENIOR EDITOR, TRNN: Welcome to The Real News Network. I'm Paul Jay in Baltimore. And welcome to this week's edition of The Bill Black Financial and Fraud Report.

    And Bill now joins us from Kansas City, where he is a professor of economics and law at the University of Missouri–Kansas City. He's a white-collar criminologist, a former financial regulator, and author of the book The Best Way to Rob a Bank Is to Own One.

    Thanks for joining us again, Bill.

    BILL BLACK, ASSOC. PROF. ECONOMICS AND LAW, UMKC: Thank you.

    JAY: So what are you following this week?

    BLACK: Well, this week they've added UBS, the giant Swiss bank, to the ranks of the criminal enterprises that are admitting that they committed massive violations of the law. So, to review the bidding, HSBC, the largest bank in Europe, had for at least 15 years been violating the law in three areas. One, it was helping the most violent drug cartels in Mexico launder massive amounts of money. Two, it was helping nations like Iran and Sudan evade U.S. financial sanctions. And three, it was helping organizations the United States considers terrorist—Hamas, Hezbollah, and al-Qaeda—evade financial sanctions.

    Despite these massive violations, the United States Department of Justice said: not only will we not bring a criminal case against HSBC; we won't bring it against its officers, and we won't even bring it against former officers, because it's too big to prosecute. And the newly appointed head of supervision, banking supervision in the United Kingdom, said, yes, that's right; this entity is too big to prosecute. So we have the official insanity that they've decided that in the interest of banks' stability, we need to leave felons in charge of the largest banks in the world.

    Then came UBS. And UBS is an entity that's been bailed out multiple times and also admitted to committing large-scale felonies in terms of tax evasion against the United States, where again it got a slap on the wrist. This time it got another fine and slap on the wrist.

    But one entity, a Japanese affiliate, will be prosecuted and two individuals, both of them relatively down in the food chain, but one of whom while quite young making the mistake of emailing other employees engaged in the fraud. And this fraud was fixing the Libor rate—that's the most important rate in the world, in which—a massive amount of financial contracts are priced off of that—and they engaged in just a naked cartel to fix the price of that Libor index. Well, this particular individual who's being prosecuted sent emails to other people engaged in the fraud, urging them not to cooperate with the FBI investigation. And that of course got him on the list of we're going to find a way to put you in prison. So two trivial guys and one obscure affiliate, but otherwise, UBS won't be prosecuted either.

    JAY: Let's go back to the money laundering thing and the drug cartels and such. First of all, these aren't the only banks that have been involved in money laundering. Some of these big banks have been caught in the past. Am I right? And is there anything in all of this that would stop them from doing this?

    BLACK: Well, yes. Many banks have done it. Yes, HSBC did it for many, many years, and it did it after repeated warnings from government, and from even internal employees. But they didn't want to stop doing it, because, of course, they were making a lot of money. And in particular, the officers—who, after all, decide these things—were making big money in the form of bonuses and such. And those people don't even have to give back their money. Only a couple of obscure compliance people will have to give back their money.

    So what have they done? These entities—well, Barclays just hired the former head of supervision in the United Kingdom, someone who is notorious for absolutely refusing to enforce the laws, and he is their guy in charge of compliance. So I'm sure that's going to make everything better.

    JAY: That's brilliant. Okay. What else you watching this week?

    BLACK: Well, we're headed into the next year. Right at this point, it looks like the grand fiscal cliff negotiations won't succeed before the end of this year.

    I've just done a piece, you know, that asks the question, since everybody agrees now that the fiscal cliff is incredibly stupid and really dangerous, in the sense that it's designed to impose austerity, and they're saying that if we were to continue this austerity for very long, we would throw the nation back into recession, I went back and looked. How did we come about—you know, who's the moron that created this fiscal cliff that they're talking about? And it turns out it's President Obama. And it's not only President Obama that insisted on this, but he insisted on the fiscal cliff for the express reason that it would create what he called "discipline"—what I would call extortion—on liberals to vote in favor of beginning to unravel the safety net—Social Security, Medicare, Medicaid, and food stamps—'cause if they didn't, lo and behold, there'd be this fiscal cliff and all kinds of social programs would be gutted. So throw Grandma under the bus was the logic.

    JAY: So you're saying it wasn't meant to target the Republicans into a crisis; it was actually more meant—more progressive Democrats to stampede them into a crisis.

    BLACK: That's from Obama's perspective. And then two things happened. The House Republicans in particular said, let's de-fang this fiscal cliff, and Obama fought that and killed it. And then the Republicans, after the so-called supercommittee failed to get budget cuts, said, let's change the law so there's no fiscal cliff, and President Obama issued a veto warning, saying that he would veto any legislation removing the fiscal cliff.

    So we're left with the following forms of insanity. First, that President Obama is the leading person who created this fiscal cliff to deliberately create this danger of austerity throwing the nation back into recession. Now he agrees that's insane.

    So what is his proposed solution? Even greater austerity through an agreement with congressional Republicans. So, you know, Obama would have been destroyed politically and United States would have been thrown back into a great recession if Obama had been able to get the austerity he was seeking back in July 2011 through what he called the grand bargain and I call the great betrayal.

    Fortunately, the combination of the Tea Party and progressive Democrats saved Obama and saved the nation. But Obama has kept on trying to get austerity ever since. And so the new year, the major question is: can progressives once more save Obama from Obama and save the nation from Obama and this European-style austerity that would throw America back into recession?

    JAY: Thanks for joining us, Bill.

    BLACK: Thank you.

    JAY: And thank you for joining us on The Real News Network.

    End

    DISCLAIMER: Please note that transcripts for The Real News Network are typed from a recording of the program. TRNN cannot guarantee their complete accuracy.


    Comments

    Our automatic spam filter blocks comments with multiple links and multiple users using the same IP address. Please make thoughtful comments with minimal links using only one user name. If you think your comment has been mistakenly removed please email us at contact@therealnews.com

    Comments


    Latest Stories


    How I Joined the CIA - John Kiriakou on Reality Asserts Itself (2/8)
    Obama to Get "Fast Track" for Trade Pacts
    Official: Baltimore Cutting Water to Hundreds of Residents and Zero Corporations
    Welfare System Designed to Keep the Poor Poorer
    The UK Election Debate: "Hamlet Without the Prince"
    BREAKING: US Senate Advances the Trans-Pacific Partnership
    I Believed America Could Do No Wrong - John Kiriakou, Former CIA Official, on Reality Asserts Itself (1/8)
    TRNN Covers Historic National Day of Action for Fast-food Workers
    The Rich Get Richer If House Republicans Repeal the Estate Tax
    The Fragmentation of Canadian Climate Policies
    Lincoln and Black Self-Emancipation
    Pentagon Declares Airstrikes against ISIS a Success in Iraq
    Why Did Russia Sell S-300 Missiles to Iran?
    Safe Streets: Baltimore's Secret Crime Fighting Weapon
    Obama To Remove Cuba from "Terror" List
    Is Rand Paul Still a Libertarian?
    Fast Food Workers Gear Up for Nationwide Strike for $15
    Blackwater Guards Sentenced for the Murder at Nisour Square, Baghdad
    Growing Calls for Reparations for the International Slave Trade
    Sen. Marco Rubio Unveils His Candidacy and Platform for "A New American Century"
    Ethiopia Accuses Eritrea of Backing al-Shabaab
    Lessons from the Summit of the Americas
    Empowering Baltimore Youth with Media, Art, Activism, and Pan-African Culture.
    TRNN Replay: Why, Senator Clinton? October 18, 2007
    Proxy Morons: The Demolition of Yemen (3/3)
    The For-Profit Video Visitation Industry Quietly Sweeps the Nation's Prisons and Jails
    TRNN Replay: Clinton Dynasty Revisited
    The Story of a Struggle to Keep East Baltimore's Men and Families Center Open
    The EuroDiVision Contest
    Will Canadian Provinces Block Pipeline Expansion?

    RealNewsNetwork.com, Real News Network, Real News, Real News For Real People, IWT are trademarks and service marks of IWT.TV inc. "The Real News" is the flagship show of IWT and Real News Network.

    All original content on this site is copyright of The Real News Network.  Click here for more

    Problems with this site? Please let us know

    Linux VPS Hosting by Star Dot Hosting