DURING THE
BANKSTER-OWNED PRESIDENT’S FIRST TERM ALONE, BANKSTER PROFITS SOARED AS DID
BANK CRIMES and FORECLOSURES.
“That McLaughlin’s plan can be presented as “left” only
underscores the fact that the Obama administration has done absolutely nothing
to assist homebuyers. Its mortgage programs have been based on the banks
voluntarily agreeing to restructure loans for small sections of the population,
with no reduction in principal. The administration has worked closely with the
banks to minimize their liability for their fraudulent and criminal practices
that have already led millions to lose their homes.”
AS A NATION ,
WE’VE WATCHED BARACK OBAMA BECOME THE WILLING RENT BOY TO HIS CRIMINAL BANKSTER
DONORS. DURING OBAMA’S FIRST YEAR ALONE, THESE BANKSTERS MADE MORE PROFITS THAN
DURING ALL EIGHT YEARS OF BUSH. THEIR CRIMES AND FORECLOSURES ARE SOARING AS
WELL.
WELLS FARGO,
ONE OF THE BIGGEST BANK CRIME WAVES IN AMERICAN HISTORY, HAS LONG HAD IT
CALIFORNIA MORTGAGE LICENSE REVOKED IN THE STATE of CALIFORNIA FOR FRAUD AND MALFEASANCE.
IT REMAINS REVOKED TO THIS DAY. THIS FILTHY BANK SIMPLY DECLARED ITSELF ABOVE STATE
LAW AND WENT ON LOOTING THE AMERICAN PEOPLE WITH THEIR FRAUDULENT AND CRIMINAL
MORTGAGE PRODUCTS. THERE ARE COMMUNITIES NATIONWIDE THAT HAVE BEEN LAID WASTE
BY WELLS FARGO’S MORTGAGE PRACTICES.
CALIFORNIA
SEN. DIANNE FEINSTEIN, ONE OF THE MOST CORRUPT AND SELF-SERVING POLITICIANS IN
AMERICAN HISTORY, IS WELLS FARGO AND BANK of AMERICA’S BIG WHORE IN CA. EVEN
AFTER WELLS FARGO HAD THEIR MORTGAGE LICENSE REVOKED IN CA, FEINSTEIN, THE
BOUGHT WHORE, PUSHED FOR THE SO CALLED “BANKSTERS’ BANKRUPTCY REFORM” WHICH
PREVENTS CONSUMERS FROM OBTAINING HELP IN BANKRUPTCY COURT FROM THESE TOXIC
MORTGAGES WELLS FARGO AND BANK of AMERICA PERPETRATED A NATIONWIDE. THESE BANKS
ARE BIG BRIBESTERS TO THE OLD WHORE FEINSTEIN.
WHILE BARACK
OBAMA DID NOTE VOTE FOR THE “BANKSTERS’ BANKRUPTCY REFORM” AS A U.S. SENATOR,
AND SAID HE WOULD REVOKED IT, OF COURSE IT WAS ONE OF THE MANY LIES HE PERPETRATED
ON US. THIS IS THE MAN THAT DECLARED IN THE FACE OF THE NATION HIS BANKSTER
CRONIES ARE LOOTING, THAT HE WAS NOT THERE TO PUNISH BANKS, AND NONE AS BEEN.
MOST OF THE BIGGEST CRIMINAL BANKSTERS NOW VIRTUALLY OPERATE OUT OF THE OBAMA
WHITE HOUSE, OR HAVE ADMINISTRATION JOBS TO ASSURE BANKSTER THERE WILL NEVER BE
ANY REAL REFORM.
THESE FILTHY
BANKSTERS HAVE DESTROYED TRILLIONS OF DOLLARS IN HOME EQUITY IN THE STATE OF
CALIFORNIA ALONE AND ARE STILL LOOTING US THANKS TO OBAMA AND FEINSTEIN, AND
THEREFORE FEINSTEIN’S LAP BITCH, BARBARA “BRIBES” BOXER, WHO VOTES FOR ANYTHING
THAT WILL PUT BUCKS IN FEINSTEIN’S PIMP-HUSBAND, RICHARD C. BLUM’ POCKETS. BLUM
IS A MAJOR DONOR/BRIBESTER TO BOXER AND OBAMA.
NOT ONLY IS
FEINSTEIN THE BIGGEST WAR PROFITEER IN AMERICAN HISTORY, SHE HAS PUSHED A DEAL
FOR PIMP BLUM TO PROFITEER OFF THE VERY FORECLOSURES HER BRIBESTERS WELLS FARGO
AND BANK OF AMERICA CAUSED…. WERE YOU WONDERING WHY NOTHING EVER CAME OUT OF
HER BIG WHORE’S MOUTH ABOUT THE FORECLOSURE CRISIS IN CALIFORNIA OR THE NATION?
WHEN THERE’S A DEAL TO BE MADE, THIS OLD WHORE IS RIGHT THERE IN THE ALLEY ON
HER KNEES DOING IT!
The housing crisis in Richmond,
California and the debate over “eminent domain”
By David Levine
17 September 2013
Last Tuesday,
the City Council in Richmond, California approved, by a vote of 4-3, a plan to
take over the mortgages of a small section of the city’s population, organize a
reduction of the principal and refinance the loans under the auspices of
another private company.
The move has
been combined with a push to utilize the government’s eminent domain powers to
seize mortgages with the ostensible purpose of keeping families in danger of
foreclosure from losing their homes. The city will need a 5-2 vote in order to
actually begin exercising eminent domain over mortgages.
On Thursday,
September 12, US District Judge Charles Breyer granted the city’s motion to
dismiss a lawsuit by mortgage bond trustees Wells Fargo and two units of
Deutsche Bank on the grounds that it was “unripe.” However, there
can be little doubt that if the program goes forward, more lawsuits by the
banks will be forthcoming.
The
determination of the banks and financial institutions to scuttle the city’s
plan points to their intransigent opposition to any measure that involves a
reduction in the principal (the overall amount owed) on mortgages to distressed
homeowners in the US. However, the city’s plan itself is a token measure that
will do nothing to remedy the housing crisis, even if the eminent domain
component goes forward.
The idea of
using a city government’s eminent domain power in this way belongs to Cornell
University Law School Professor Robert Hockett. However, its proliferation is
most strongly associated with the San Francisco-based Mortgage Resolution
Partners LLC (MRP). Beginning last year, MRP has consulted city governments in
various parts of California and other states, offering partnership agreements
for the administration of eminent domain programs based on Hockett’s approach.
Richmond is the first city to execute such an agreement with MRP.
MRP’s proposed plan, which the city government has titled
Richmond CARES (Richmond Community Action to Restore Equity and Stability), is
for the city to seize at-risk mortgages, compensate the mortgage holders (the
mortgage-security firms) based on the fair market value of the loans, and then
make refinancing arrangements that would be more manageable for homeowners.
MRP, in addition to gaining a fee of $4,500 per house, is to split the profits
from the refinancing with the city.
On July 31,
Richmond City Manager William Lindsay sent out a letter to the mortgage holders
of 624 residences offering to purchase the mortgages for their fair market
value (minus 20 percent representing the estimated costs of foreclosure). He
warned that those mortgages whose holders refuse this offer would be subject to
seizure through eminent domain, which would provide a “fair” amount of
compensation based on a court-approved valuation. The letter requested a response
by August 13.
Not only were none of those offers accepted, but Wells Fargo and
Deutsche Bank filed a lawsuit seeking injunctions against the proposed eminent
domain program. In the lawsuit, the two banks are acted under the direction of
a group of investors including Pacific Investment Management Co. (Pimco),
BlackRock Inc., DoubleLine Capital, as well as the government-supported
mortgage loan insurance companies Fannie Mae and Freddie Mac
OBAMA SABOTAGES ANY ACT THAT WILL NOT PUT BUCKS IN HIS CRIMINAL
BANKSTER DONOR’S BOTTOMLESS POCKETS, EVEN AS HE HAS HANDED THESE CRIMINAL
ENTERPRISES BILLIONS IN FEDERAL WELFARE.
On August 8,
the Federal Housing Finance Agency, which regulates Fannie Mae and Freddie Mac,
declared that the agency would instruct those companies to “limit, restrict or
cease business activities” in any jurisdiction that uses eminent domain to
seize mortgages. This directive from the Obama administration significantly
undercut the proposed program, as the city could not possibly afford to handle
being abandoned by these companies, which provide insurance for mortgage loans.
In August, when
the city of Richmond tried to refinance $34 million of its bonds, it failed to
find willing purchasers on the markets. Apparently, investors decided to forgo
purchasing the bonds as payback for the mortgage proposal, which failed to toe
the line dictated by the financial elite.
The city of Richmond, a largely working class city north of San
Francisco, is experiencing some of the worst consequences of the subprime
mortgage crisis that began in 2007-2008. Despite a recent modest recovery in
property values, some 4,600 homeowners, or about 50 percent of the mortgages in
the city, are still “underwater,” meaning that the current balance on their
mortgage loans is greater than the houses’ respective fair market values. The
average mortgage debt is 45 percent of the property’s value.
The limited
nature of the proposed eminent domain program becomes clear in light of the
above numbers. MRP has selected 624 residences for the program—less than 15
percent of the city’s residences with underwater mortgages. Even more telling
are the criteria by which the residences were selected. Over 70 percent of
those selected are current on their payments, and those that are not current
have, for the most part, missed only one or two payments.
MRP
deliberately selected loans that were not at risk of default. Rather, it chose
loans where the borrowers have a high likelihood of avoiding default and
qualifying for new loans that could be sold to a new securitized trust. The
other criterion that MRP followed was that it selected only mortgages held by
“private label” mortgage-backed security trusts, and excluded mortgages held
directly by banks and/or guaranteed by Freddie Mac and Fannie Mae. None of
these criteria have anything to do with protecting homeowners from foreclosure
and have everything to do with MRP’s own business strategy.
The proposed
eminent domain program has been the subject of extensive commentary in the
media, with the majority of commentators opposing the program. However, the debate has generally been framed in terms of
potential impacts on investors and markets, with no concern shown for the
countless millions of victims of the ongoing housing crisis who cannot afford
to refinance their homes, not to speak of the broader housing crisis in the US.
Although there
is no question that the big banks and investors that are driving the lawsuits
and media campaign against the proposed program represent America’s financial
aristocracy, opponents of the program have also made the legitimate criticism
that investors in the mortgage-backed securities under threat of seizure
include “public and private pension plans, college savings plans, 401(k) plans,
insurance companies, mutual funds, university endowments, and
government-sponsored enterprises” (quoting the Wells Fargo/Deutsche Bank
complaint). In other words, a program that may help some remain in their homes
could leave others with less retirement savings and smaller pensions than they
thought they had, and for still others make college education even less
affordable than before.
Essentially, the conflict between the banks and Richmond and MRP
is a fight between two factions within the ruling capitalist class. On the one
side are those banks that act as trustees for the possessors of mortgage-backed
securities. They have profited from subprime lending and other shady policies
that victimize individual borrowers, as well as the fraudulent overvaluation of
the securities created out of the resulting debts. These were the criminal
processes carried out on a massive scale that culminated in the financial
market crash of 2008, for which no one has been held accountable to this day.
On the other
side are MRP and other financial institutions, which stand to profit from the
refinancing of mortgages. In other words, having recognized the social
devastation wrought by the financial and economic crisis, they have developed
an approach that will allow them to rearrange the debts of a small percentage
of the lesser-affected victims for their own benefit while contributing to the
creation of a new housing bubble. Richmond has become their testing ground. If
the program is successfully implemented there, they aim to secure the adoption
of similar programs throughout the country.
MRP has won the
support of Richmond Mayor Gayle McLaughlin, a member of the Green Party who
postures as a “left.” McLaughlin participated in Occupy protests and
collaborated with the Service Employees International Union (SEIU) and various
“antiwar” organizations. On August 15, she led a group of about 50 protesters
to the Wells Fargo corporate headquarters in San Francisco in a phony display
of defiance that can only serve to disorient and demoralize those who suffer
the brunt of the banks’ rapacity. She has also won the backing of pseudo-left
groups like the International Socialist Organization.
That McLaughlin’s plan can be presented as “left” only
underscores the fact that the Obama administration has done absolutely nothing
to assist homebuyers. Its mortgage programs have been based on the banks
voluntarily agreeing to restructure loans for small sections of the population,
with no reduction in principal. The administration has worked closely with the
banks to minimize their liability for their fraudulent and criminal practices
that have already led millions to lose their homes.
A real solution
to the housing crisis in America must necessarily proceed from a recognition
that housing is a social right, and that the realization of that right requires
the expropriation of the banks and other financial institutions whose criminal
practices caused the crisis but continue unchecked. Such a policy can be
effected only as part of a revolutionary socialist program.
*
SEN. DIANNE FEINSTEIN, AND HER VOTING LAP BITCH, BARABARA"BRIBES" BOXER ARE TWO OF THE MOST CORRUPT AND SELF-SERVING POLITICIANS IN U.S. HISTORY. ADD NANCY PELOSI TO THE MIX!
LA RAZA DEMS
LIKE OBAMA, FEINSTEIN, BOXER, PELOSI and REID, A WHO’S-WHO OF CORRUPTION, HAVE
WORKED TIRELESSLY ADVANCING THE INTERESTS OF THE MEXICAN FASCIST PARTY of LA
RAZA. TO THESE LA RAZA DEMS, KEEPING OUR BORDERS WIDE OPEN KEEPS WAGES
DEPRESSED AND PUTS MONEY IN THEIR POCKETS.
YOU CAN NOT
SEPARATE THE CORRUPTION OF THESE POLITICIANS, THE LA RAZA OCCUPATION, AND THE
LOOTING OF THE NATION BY THEIR BANKSTER DONORS!
MEXICAN DRUG
DEALER OPERATES IN OUR BORDERS
THE MEXICAN
DRUG CARTELS OPERATE IN 2,500 AMERICAN CITIES AND WHOLEHEARTEDLY ENDORSE
OBAMA’S OPEN AND UNDEFENDED BORDERS AGENDA.
“Oropeza,
48, was arrested May 31, 2007, by police in Saraland, Ala., who stopped him on
a traffic violation. Checking his record, they learned of the investigation in
Texas.
They
searched the van and discovered 185 pounds of cocaine hidden under a false
floor. That allowed federal agents to freeze Oropeza's bank accounts and search
his marble-floored home in Brownsville, Robinette says.”
The
government, like the banks, had a vested interest in shutting down the
investigation, as the results of any genuine inquiry would have exposed negligence
and collusion on the part of the regulators as well as gross violations of law
by the banks that would have made it more difficult for the Obama
administration to avoid criminal prosecutions.
The Times also reported that such “independent
investigators” played a key role in the HSBC money laundering scandal, helping
cover up the extent of the British-based bank’s money laundering operation for
Mexican drug cartels.
Firms
make billions as middlemen in government cover-up of Wall Street crimes
By Andre Damon
7 February 2013
In
the network of corrupt and incestuous relations between government financial
regulatory agencies and the banks they nominally police, a growing role is
played by private, for-profit “consulting” firms that serve as middlemen in the
government cover-up of corporate crime.
The
New York Times in a front-page article last week called attention to
this lesser-known mechanism used by the government to protect Wall Street from
being held to account for the fraudulent and illegal practices in which it
engages on a daily basis.
The
Times wrote: "Federal authorities are scrutinizing private
consultants hired to clean up financial misdeeds like money laundering and
foreclosure abuses, taking aim at an industry that is paid billions of dollars
by the same banks it is expected to police."
The
firms in question operate in essentially the same way as the credit rating
agencies that facilitated the subprime meltdown. Just as Standard & Poor’s
Rating Services and Moody’s Investors Service are paid by the banks whose
securities they rate, the consulting firms tasked with investigating banks are
chosen and paid by the very institutions they are investigating. This
arrangement is based on a howling conflict of interest. Consulting firms that
want to keep old clients and add new ones, and increase their profits, are
obviously under pressure to cover up the misdeeds of their banking paymasters.
Moreover,
the same revolving door by which individuals move seamlessly between Wall
Street and the regulatory agencies exists between the consulting firms and the
banks and regulatory bodies.
Last
month's $8.5 billion foreclosure fraud settlement with major US lenders lifted
the lid on bank regulators' increasing use of these “independent
investigators.” Tasked with finding the extent of fraud and illegality in the
processing of home foreclosures, these companies helped the banks cover up
their fraudulent activities and ensure that the extent of their wrongdoing was
not brought to light.
The
settlement between ten major mortgage lenders and the Office of the Comptroller
of the Currency (OCC), a branch of the Treasury Department, related to
widespread fraud committed by the banks in their rush to foreclose on as many
homes as possible in 2009 and 2010. To expedite the foreclosure process, the
banks had employees or contractors sign off on thousands of mortgage documents
every month, swearing that they had intimate knowledge of their contents when,
in reality, they had not even read them.
This
resulted in the improper expulsion of an unknown number of families—probably in
the hundreds of thousands—from their homes.
In
April of 2011, the OCC, the Office of Thrift
Supervision (OTS), and the Board
of Governors
of the Federal Reserve System ordered individual
reviews of
foreclosures carried out between 2009
and 2010 by fourteen mortgage lenders,
including
Bank of America, Citibank, JPMorgan Chase and
Wells Fargo.
The
investigation was intended to individually review all cases in which homeowners
claimed that they were improperly foreclosed on, so that each victimized
household could receive a cash payout. The findings of such an investigation
would have undoubtedly shown that foreclosure fraud was far more prevalent than
had been previously known, and laid the basis for further lawsuits against the
lenders.
Instead
of reviewing the foreclosures themselves, regulators had the banks hire
so-called independent investigators, who, while receiving $2 billion in fees
from the lenders, dragged their feet in reviewing the foreclosure cases.
Last
month, government regulators closed down the review on the grounds that it was
too time-consuming and too expensive for the banks and came up with a
sweetheart settlement that cost the banks a relative pittance.
Instead
of payouts to individuals who were harmed by the banks' wrongdoing, the lenders
agreed to split a $3.3 billion cash payout among 4.2 million foreclosed
homeowners, without "determination of harm." As a result, homeowners
will receive a check of under $1,000 even if they were illegally thrown out of
their homes.
The government, like the
banks, had a vested interest in shutting down the investigation, as the results
of any genuine inquiry would have exposed negligence and collusion on the part
of the regulators as well as gross violations of law by the banks that would
have made it more difficult for the Obama administration to avoid criminal
prosecutions.
When
setting up the "Independent Foreclosure Review" in April 2011,
regulators claimed that they had to rely on independent contractors such as
Promontory Financial and PricewaterhouseCoopers because regulators themselves
had neither the money nor the manpower the review the claims.
"The
Office of the Comptroller of the Currency employs just 3,800 people, only about
2,000 of whom are bank examiners," said Bryan Hubbard, director for public
affairs operations at the OCC in a telephone interview Monday. "It would
simply not have been practical to hire the staff necessary for the
review."
He
added that "independent consultants are used often by many regulators, not
just the OCC, in support of enforcement actions. It was not unusual." He
added that the decision to end the review "will provide more money to more
borrowers than maintaining the original course."
The
argument that closing down the investigation resulted in greater compensation
for victimized borrowers is absurd.
The
growing scandal over the role of “independent consultants” in the foreclosure
abuse settlement prompted Senator Elizabeth Warren and Representative Elijah
Cummings to send a letter to the US Federal Reserve and office of the
Comptroller of the Currency last week, asking them to publish documents related
to the role of the consultants hired by the banks to review foreclosures.
The
role of such "independent investigators" in covering up the banks'
crimes goes beyond the foreclosure settlement. Since the 2008 financial
meltdown, it has become increasingly common for financial regulators to rely on
such companies in regulatory actions. The New York Times reported that
the OCC required the hiring of such consultants in more than 130 regulatory
actions since 2008.
The Times also
reported that such “independent investigators” played a key role in the HSBC
money laundering scandal, helping cover up the extent of the British-based
bank’s money laundering operation for Mexican drug cartels. The newspaper reported that
HSBC was cited for its loose money laundering protections in 2003 and turned to
the consulting firm Deloitte & Touche to review its compliance with
regulations.
In
2010, the bank was again investigated in connection to its money laundering
activities, ultimately leading to a $1.9 billion settlement with regulators
late last year. To help determine the fine to be levied, HSBC was ordered to
hire an independent consultant to assess the extent of its legal
transgressions.
The bank hired its reliable
ally of previous years, Deloitte & Touche, which, according to the Times,
"generously bundled hundreds of missed transfers into a single
report," which "may have helped save the bank from some government
fines."
"Independent
investigators" like Deloitte and Promontory are staffed largely by former
regulators, who, having gained experience in government, have turned to using
their knowledge to help banks skirt regulations, for sizable fees. Promontory
Financial, which examined loans for Bank of America and Wells Fargo, is a case
in point. The company was founded in 2000 by Eugene Ludwig two years after he
left his position as Comptroller of the Currency.
Last
month, Promontory announced that Julie Williams, the former chief council at
the OCC, would join the group to become the firm's director of advisory
practice. “I thought I could do more good helping firms understand and comply
with government expectations—which are not always just what’s in rules and
regulations—at Promontory,” she said upon taking the job.
PricewaterhouseCoopers, which carried out the foreclosure fraud
investigation for Citigroup, brags to potential clients that its "teams
consist of experienced regulatory risk specialists, including ex-regulators,
who not only know the rules, but have also implemented and assessed compliance
against them."
OBAMA PROMISED HIS CRIMINAL BANKSTER
DONORS NO PRISON TIME AND NO REAL REGULATION. DID HE DELIVER?
The JPMorgan
scandal also throws into relief the government’s failure to prosecute those
responsible for the 2008 financial meltdown. Despite overwhelming evidence of
wrongdoing and criminality uncovered by two federal investigations last year,
those responsible have been shielded from prosecution.
Records show that four out of Obama's
top five contributors are employees of financial industry giants - Goldman
Sachs ($571,330), UBS AG ($364,806), JPMorgan Chase ($362,207) and Citigroup
($358,054).
*
The
social and historical catastrophe confronting mankind is not simply the product
of an economic crisis in the abstract. This crisis is mediated by class
interests, and these class interests find expression in definite actions.
Behind the central banks and governments stand the interests of a financial
elite whose relationship to the rest of society is fundamentally parasitic.
AMERICAN HAS
WITNESSED HOLDER AND OBAMA PROMISE OBAMA’S CRIMINAL BANKSTER DONORS THEY WOULD
NEVER BE PROSECUTED.
OBAMA HOLDER
HAVE ALSO ENDLESSLY HARASSED AMERICAN STATES WITH LAWSUITS TO ADVANCE OBAMA’S
LA RAZA AGENDA OF OPEN BORDERS, NO E-VERIFY, NO ID TO VOTE, ENDLESS GRINGO-PAID
DREAM ACTS TO KEEP THE ILLEGALS CLIMBING OUR BORDERS AND JOBS.
OBAMA’S DEPT of
(illegal) LABOR IS LA RAZA SUPREMACIST HILDA SOLIS!
CRIMINAL BANKSTERS
WELLS FARGO ARE BANKSTERS TO THE MEXICAN DRUG CARTELS.
WELLS FARGO,
ALONG WITH BANK of AMERICA, IS A MAJOR DONOR TO THE MEXICAN FASCIST PARTY of LA
RAZA.
BOTH BANKS HAVE
OPENED BANK ACCOUNTS FOR ILLEGALS USING PHONY MEX CONSULATE IDS.
A SUBSTANTIAL
AMOUNT OF THE MONEY ILLEGALS DEPOSIT IS MEX GANG MONEY.
WELLS FARGO HAD
THEIR CALIFORNIA MORTGAGE LICENSE REVOKED IN 2003. IT SILL IS. THE CRIMINAL
BANK SIMPLY DECLARED ITSELF ABOVE THE LAW AND WENT ON PERPETRATING THEIR
MORTGAGE SCAMS ON CONSUMERS NATIONWIDE UNTIL TAX PAYERS WERE FORCED TO BAILOUT
OUT ALL THE DAMAGES.
“The program of “gunwalking,” as the tactic of permitting known
buyers for the Mexican gangs to purchase weapons and take them to Mexico, was
part of a murky but undoubtedly reactionary effort by the US government to
develop relations with the drug cartels, some of which deposited huge sums in
American banks, to the benefit of Wall Street.”
OBAMA and HIS
CRIMINAL BANKSTERS – THE LOOTING OF A NATION CONTINUES!
Records show that four out of Obama's top five contributors are
employees of financial industry giants - Goldman Sachs ($571,330), UBS AG
($364,806), JPMorgan Chase ($362,207) and Citigroup ($358,054).
Consider
the Obama administration's choices for the four most important positions in
financial sector law enforcement. The attorney general (Eric Holder) and the
head of the Justice Department's criminal division (Lanny Breuer) both come to
us from Covington & Burling,
a law firm that represents and lobbies for most of the major banks and their
industry associations; indeed Breuer was co-head of its white collar criminal
defense practice, and represented the Moody's rating agency in the Enron case.
Mary Schapiro, the head of the SEC, spent the housing bubble in charge of
FINRA, the investment banking industry's "self-regulator," which gave
her a $9 million severance for a job well
done. And her head of enforcement, perhaps most stunningly of all, is Robert
Khuzami, who was general counsel for
Deutsche Bank's North American business during the entire bubble. So zero
prosecutions isn't much of a surprise, really.
Banking Is a Criminal Industry Because Its Crimes Go
Unpunished
Posted:
07/16/2012 8:23 am
Consider
just this month's news in financial services.
First,
Barclay's has been manipulating the Libor, the main interest rate upon which
most other interest rates and financial transactions are based, since 2005.
Moreover, Barclay's traders were colluding with traders in many other banks to
assist them in manipulating the Libor too, so that they could all profit from
their bets on it.
Second,
JP Morgan Chase is having a really great month. Recent reports describe how it
is resisting Federal subpoenas related to
price-fixing in U.S. electricity markets. It is also accused (by former
employees among others) of deliberately inflating the performance of its
investment funds to obtain business. And finally, JP Morgan's failed "London
whale"
trade, which has now cost over $5 billion, is being investigated to determine
whether the loss was initially concealed from regulators and the public.
Third,
HSBC is paying a fine because it allowed
hundreds of millions, perhaps billions, of dollars of money laundering by rogue
states and sanctioned firms, including some related to terrorist activities and
Iran's nuclear efforts. But HSBC is only one of at least 12 banks now known to
have tolerated, and in some cases aggressively courted, money laundering by
rogue states, terrorist organizations, corrupt dictators, and major drug
cartels over the last decade. Others include Barclay's, Lloyds, Credit Suisse,
and Wachovia (now part of Wells Fargo). Several of the banks created special
handbooks on how to evade surveillance, created special business units to
handle money laundering, and actively suppressed whistleblowers who warned of
drug cartel activities.
Fourth,
a new private lawsuit cites documents indicating that Morgan
Stanley successfully pressured rating agencies into inflating the ratings of
mortgage-backed securities it issued during the housing bubble.
Fifth,
Visa and Mastercard have just agreed
to pay $7
billion to settle a private antitrust case filed by thousands of merchants, who
alleged that Visa and Mastercard colluded to fix fees and terms of service.
Just
another month in financial services. Is it unusual? No, it's not. If we go back
just a little further, we have UBS, HSBC, Julius Baer, and other banks actively
marketing tax evasion services to wealthy U.S. and European citizens. We have
senior executives of several banks (including JP Morgan Chase and UBS) strongly
suspecting that Bernard Madoff was running a Ponzi scheme, but deciding to make
money from him rather than turn him in. And then, of course, we have the
financial crisis and everything that led to it. As I show in great detail in my book Predator Nation,
we now possess overwhelming evidence of massive securities fraud, accounting
fraud, perjury, and criminal Sarbanes-Oxley violations by mortgage lenders,
investment banks, and credit insurers (including senior executives of
Countrywide, Citigroup, Morgan Stanley, Goldman Sachs, Bear Stearns, AIG, and
Lehman Brothers) during the housing bubble that caused the financial crisis. If
we go back to the late 1990s, we have the massively fraudulent hyping of
Internet stocks, and several banks (including Merrill Lynch and Citigroup)
actively aiding Enron in committing its frauds.
So,
July 2012 really isn't abnormal at all. The reason for this is very simple.
Over the past two decades, the financial services industry has become a pervasively
unethical and highly criminal industry, with massive fraud tolerated or even
encouraged by senior management. But how did that happen?
Well,
deregulation helped, of course. But something else was far more important. It
is the one critical factor that unites all of the episodes cited above,
including those of this month. This critical unifying factor is the total
number of criminal prosecutions of major firms and senior executives as a
result of all of these crimes combined.
And
what is that number?
Zero.
Literally
zero. A number that neither President Obama nor Mitt Romney shows the slightest
interest in changing.
Consider
the Obama administration's choices for the four most important positions in
financial sector law enforcement. The attorney general (Eric Holder) and the
head of the Justice Department's criminal division (Lanny Breuer) both come to
us from
Covington & Burling, a law firm that represents and lobbies for most of the
major banks and their industry associations; indeed Breuer was co-head of its
white collar criminal defense practice, and represented the Moody's rating
agency in the Enron case. Mary Schapiro, the head of the SEC, spent the housing
bubble in charge of FINRA, the investment banking industry's
"self-regulator," which gave her a $9
million severance for a job well done. And her head of enforcement, perhaps
most stunningly of all, is Robert Khuzami, who was
general counsel for Deutsche Bank's North American business during the
entire bubble. So zero prosecutions isn't much of a surprise, really.
In
contrast, what do you think would happen to you if, as a lone individual, you
were caught supporting Iran's nuclear program? Do you think that you would get
off with a "deferred prosecution agreement" and a fine equal to a few
percent of your annual salary? No?
But
that's because you don't live right. You probably haven't been to the White
House a dozen times since President Obama took office, or attended White House
state dinners, like Lloyd Blankfein has. Nor have you probably overseen
millions of dollars in lobbying and campaign donations, or hired senior
administration officials, or sent your executives into the government in senior
regulatory positions, or paid $135,000 for a speech by someone who later became
chairman of the National Economic Council. And, well, you get the law
enforcement that you pay for.
OBAMANOMICS:
HIS BANKSTERS PROFITS AND CRIMES ARE SOARING… so are foreclosures and illegals
get all the jobs!
WILL WE
SURVIVE OBAMA’S SECOND TERM?
WASHINGTON
POST
Americans
have rebuilt less than half of wealth lost to the recession, study says
American households have rebuilt less than half of the
wealth lost during the recession, leaving them without the spending power to
fuel a robust economic recovery, according to a new analysis from the Federal Reserve.
From the peak of the boom to the bottom of the bust,
households watched
a total of $16 trillion in wealth disappear amid sinking stock prices
and the rubble of the real estate market. Since then, Americans have only been
able to recapture 45 percent of that amount on average, after adjusting for
inflation and population growth, according to the report from the St. Louis Fed
released Thursday.
In addition, the report showed most of the improvement was
due to gains in the stock market, which primarily benefit wealthy families.
That means the recovery for other households has been even weaker.
“A conclusion that the financial damage of the crisis and
recession largely has been repaired is not justified,” the report stated.
The study is part of a growing body of research on the role
of household wealth — or lack thereof — in amplifying the impact of the
recession and slowing the rate of recovery. Traditionally, economists and
policymakers have focused on the effects of employment and income. But the
report from the St. Louis Fed argued that swings in household balance sheets —
which include home values, stock prices, savings and debt — were critical in
determining which families weathered the financial storm and which got swept
away.
The report found that the most fragile households were not
well educated, relatively young or black or Hispanic, or some combination of
those characteristics. Those families tended to have low savings combined with
high debt and accrued much of their wealth through housing.
How those households respond to the changes in wealth is a
critical component of the recovery. Top officials, including Chairman Ben S.
Bernanke, have pointed to the rebound in real estate and the soaring stock
market as evidence of the success of the central bank’s policies.
“I think we’re at an inflection point,” said Beth Ann
Bovino, senior economist at Standard & Poor’s. “We’re seeing things turn
around. And that’s where the optimism comes in among households.”
But research by noted economists Karl Case, John Quigley and
Robert Shiller found the households were more powerful affected by declines in
wealth than increases. An unexpected 1 percent drop in housing prices caused a
permanent 0.1 percent decrease in spending, that study found. But a similar 1
percent rise in housing prices boosted consumer spending by only 0.03 percent.
“Rising wealth is gratifying, but the loss of wealth is
terrifying,” said Mark Zandi, chief economist at Moodys.com. “Households spend
somewhat more freely as their nest eggs grow, but they slash their spending
when their nest eggs shrink.”
William Emmons, chief economist for at the St. Louis Fed’s
new Center for Household Financial Stability, said that many of the most
vulnerable households began to treat credit as another form of income during
the boom. After the bust, they were forced to dramatically rethink their
finances, resulting in more cautious spending.
Emmons said many families have not experienced any recovery
— or are even still losing wealth. Young Americans, those with few skills or
are unemployed may not have been able to rebuild any wealth. He noted that though the number of foreclosures has dropped
significantly, it is still more than double the
pre-crisis amount.
Meanwhile, he estimated that recent gains in the stock
market mean that the recovery of wealth is nearly complete for white and Asian
households and older Americans.
Wealth accumulation not only impacts families’ current
financial status but also their prospects for future economic success. The St.
Louis Fed report points to studies that connect savings to the likelihood of
attending and completing college and economic mobility.
“Balance sheets matter in ways that income alone does not,”
said Ray Boshara, head of the center.
Related Articles: Tax breaks tilt toward the rich The
economy is holding up surprisingly well in a year of austerity
Low-interest-rate environment exposes seniors to fraudsters Hiring slowed to
88,000 jobs in March; unemployment rate drops to 7.6 percent
OBAMA’S CRONY CAPITALISM – A NATION
RULED BY CRIMINAL WALL STREET BANKSTERS AND OBAMA DONORS
Culture of
Corruption: Obama and His Team of Tax Cheats, Crooks, and Cronies
by Michelle Malkin
In her shocking new book, Malkin digs deep into the records
of President Obama's staff, revealing corrupt dealings, questionable pasts, and
abuses of power throughout his administration.
assault on America – THE OBAMA – JP MORGAN LOOTING of a
nation
DID OBAMA
PUNKED US OR IS HE SIMPLY A FAILED
PRESIDENCY?
OBAMA, THE MAN THAT NEVER VOTED DURING THE BRIEF PERIOD HE
WAS IN THE SENATE, OWNED AND OPERATED BY BIG BANKSTERS, IS NOTHING BUT A CON
JOB CALLED “CHANGE”… OR DICTATOR IN THE MAKING.
EITHER WAY HE IS THE
MOST FAILED PRESIDENCY IN MODERN AMERICAN
CONGRESS
DECLARES THAT ILLEGALS SAP TAX DOLLARS… SO THEN WHAT WOULD 40 MILLION LEGALIZED
MEXICAN LOOTERS DO??? GO OUT AND VOTE GOP?
OBAMA’S CRONY CAPITALISM – A NATION
RULED BY CRIMINAL WALL STREET BANKSTERS AND OBAMA DONORS
Culture of
Corruption: Obama and His Team of Tax Cheats, Crooks, and Cronies
by Michelle Malkin
In her shocking new book, Malkin digs deep into the records
of President Obama's staff, revealing corrupt dealings, questionable pasts, and
abuses of power throughout his administration.
Government of, by, and for the banks
25 May 2013
Five years
since the 2008 financial meltdown, the speculation and fraud that caused the
crash are back in full force in the United States. Flush with the $85 billion
in cash printed up and handed to the banks every month by the Federal Reserve,
business at the Wall Street casino is booming. Stock values are at record
levels and so are bank profits, amidst declining wages and mass poverty.
Big
Banks Get Break in Rules to Limit Risks
OBAMA-STYLE CRONY CAPITALISM… business as usual for Obama’s
banksters!
OBAMA
AND HIS CRIMINAL BANKSTERS… THE LOOTING GOES ON, AND AS PER OBAMA’S
PROMISE…NONE HAVE GONE TO PRISON!
“The changes to the
rule, which will be announced on Thursday, could effectively empower a few big
banks to continue controlling the derivatives market, a main culprit in the
financial crisis.”
CRIMINAL BANKSTERS BANK of AMERICA and WELLS FARGO are two of
criminal Sen. Dianne Feinstein’s paymasters. She voted for each and every
banksters bailout that came along and did nothing about these banks crime tidal
wave the destroyed billions of dollars of property value held by the people of
California where she lives in a $16 million dollar war profiteers mansion in
San Francisco.
Feinstein is a major donor to the
OBAMANATION and supports his amnesty hoax, open borders, no E-VERIFY and any
policy that aids the looting of this nation by Obama’s BIG BANKSTER DONORS!
*
BANK of AMERICA – A MAJOR CAUSE OF
MILLIONS OF FORECLOSURES, A MAJOR DONOR to the MEXICAN FASCIST PARTY of LA RAZA
and a MAJOR MONEY LAUNDERER for the
MEXICAN DRUG CARTELS. Seen that American flag flying over their executive
offices???
BUILDING THE OBAMA DICTATORSHIP: BANKSTERS, LA RAZA
FASCIST and the MEXICAN DRUG CARTELS… business is good for them under the
Obamanation!
“Not one banker was prosecuted for illegal
involvement in the drugs trade.”
BANK of AMERICA – A MAJOR CONTRIBUTOR TO MEXICAN
FASCSIM AND DRUG CARTELS
OBAMA’S INCEST WITH BIG BANSTERS CONTINUES… WHO’D A THOUGHT???
With his faith in government and
coziness with big business, Watt personifies Obamanomics.
Big
government and big banks -- Watt is the perfect fit for Fannie, Freddie, and
Obama.
TOP OBAMA BANKSTERS
AND MEX DRUG CARTELS
BUILDING THE OBAMA
DICTATORSHIP: BANKSTERS, LA RAZA FASCIST and the MEXICAN DRUG CARTELS… business
is good for them under the Obamanation!
“Not one banker was prosecuted for illegal involvement in the
drugs trade.”
SHE RANKS AS ONE OF
THE MOST CORRUPT AND SELF-SERVING POLITICIANS IN AMERICAN HISTORY.
THE STAGGERING DEGREE
OF HER CORRUPTION IS SIMPLY EMBLEMATIC OF THE CORRUPTION OF THE UNITED STATES
SENATE.
MONEY GRUBBING KLEPTOMANIAC DIANNE FEINSTEIN
A COMMENT ABOUT THE WHITE COLLAR CRIME DUAL OF SEN. DIANNE FEINSTEIN
AND RICHARD C. BLUM, MAJOR OBAMA DONORS:
This system is best characterized
as a plutocratic kleptocracy, completely lacking in authentic democracy,
operated by and for corporate racketeers, in short, a dictatorship of big
capital, the top 1% of wealth holders, which makes up a ruling class."
SEN.
DIANNE FEINSTEIN, WHOM RALPH NADER HAS APTLY CHARACTERIZED AS A "CLOSET
REPUBLICAN" (LIKE OBAMA), HAS TURNED CALIFORNIA INTO A MEXICAN
LOOTED WELFARE STATE.
FEINSTEIN - BLIM LOOT VICTIMS OF HER BANKSTER-CAUSED FORECLOSURES!
$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$
EXCLUSIVE: Senator’s husband’s firm cashes in on crisis
-
The Washington Times
On the day the new Congress convened this year, Sen. Dianne
Feinstein introduced legislation to route $25 billion in taxpayer money to a
government agency that had just awarded her husband's real estate firm a
lucrative contract to sell foreclosed properties at compensation rates higher
than the industry norms.
Mrs. Feinstein's intervention on behalf of the Federal
Deposit Insurance Corp. was unusual: the California Democrat isn't a member of
the Senate Committee on Banking, Housing and Urban Affairs with jurisdiction
over FDIC; and the agency is supposed to operate from money it raises from
bank-paid insurance payments - not direct federal dollars.
Documents reviewed by The Washington Times show Mrs.
Feinstein first offered Oct. 30 to help the FDIC secure money for its effort to
stem the rise of home foreclosures. Her letter was sent just days before the
agency determined that CB Richard Ellis Group (CBRE) - the commercial real
estate firm that her husband Richard Blum heads as board chairman - had won the
competitive bidding for a contract to sell foreclosed properties that FDIC had
inherited from failed banks.
• Read the rate list for
the FDIC contract from CB Richard Ellis, the firm Sen. Feinstein's husband
heads as board chairman. (downloads 4-page pdf)
• Read the correspondence
between Sen. Feinstein and FDIC chairman Sheila Bair (downloads
5-page pdf)
About the same time of the
contract award, Mr. Blum's private investment firm reported to the Securities
and Exchange Commission that it and related affiliates had purchased more than
10 million new shares in CBRE. The shares were purchased for the going price of
$3.77; CBRE's stock closed Monday at $5.14.
Spokesmen for the FDIC, Mrs.
Feinstein and Mr. Blum's firm told The Times that there was no connection
between the legislation and the contract signed Nov. 13, and that the couple
didn't even know about CBRE's business with FDIC until after it was awarded.
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Senate ethics rules state that
members must avoid conflicts of interest as well as "even the appearance
of a conflict of interest." Some ethics analysts question whether Mrs.
Feinstein ran afoul of the latter provision, creating the appearance that she
was rewarding the agency that had just hired her husband's firm.
"This clearly gives the
appearance of a conflict of interest," said Kent Cooper, a former federal
regulator who specializes in government ethics and disclosures. "To
maintain the people's trust in government, it is incumbent on a legislator to
take the extra steps necessary to ensure that when she introduces any
legislation that it does not cause people to question her motives or the
business activities of her spouse."
Mrs. Feinstein and Mr. Blum, a
wealthy investment banker, are a power couple in both Washington and California
who sat behind President Obama during his inauguration in January. Mrs.
Feinstein also is mentioned as a candidate for California governor.
The FDIC contract "highlights
the problem of a senator with a spouse who has extensive business interests
that intersect frequently with the federal government," said Melanie
Sloan, executive director of the watchdog group Citizens for Responsibility and
Ethics in Washington (CREW). "Even if there is no actual conflict of
interest, it often has the appearance of a conflict."
A 'very sweet deal'?
Real estate specialists also
question the government's generosity in the CBRE contract.
The firm, known for its commercial
real estate services, is to be paid monthly maintenance fees for each
foreclosed property it handles, as well as commissions and incentives. The
total compensation can range from 8 percent of the sales price on many
residential properties to 30 percent for properties worth $25,000 or less. A
smaller firm also won a slice of the work with similar terms, records show.
Most real estate agents earn no
more than 6 percent on residential, even on foreclosed properties, and CBRE
doesn't have as much experience in foreclosure sales as other firms, the
experts said.
"From everything I know about
it, it is a very sweet deal and went to somebody who is less than qualified in
dealing with foreclosed residential properties. Their expertise is in
commercial real estate," said Cynthia Kenner, a Colorado real estate agent
who specializes in selling bank-owned residential properties and last year
helped sell more than 600 foreclosed properties.
"There are companies that are
more experienced in selling such properties than CB Richard Ellis," she
added.
FDIC and Feinstein respond
The FDIC said politics was not
involved in its decision, noting the contract was awarded after a six-month
competition run by career staff who determined that CBRE was "deemed to be
technically qualified and their fee structure fair and reasonable." That
means the competition did not mandate the contract go to the lowest bidder
necessarily, officials said.
The agency said the above-market
incentives were designed to encourage quick sales of the growing number of
foreclosed properties the FDIC has inherited during the recession. "The
longer the asset is held, the more costly it is for the FDIC, and more expenses
are incurred for the assets," the agency said in a statement to The Times.
Feinstein spokesman Gil Duran said
there was no conflict of interest between Mr. Blum's firm getting the contract
and the senator's legislation. He said she introduced the legislation because
it would help prevent home mortgage foreclosures at a time when many
Californians were in danger of losing their homes.
"She was not aware of the
contract before she introduced the legislation," Mr. Duran said.
"There is no evidence of any relationship or conflict between this
foreclosure relief bill and the contract. Senator Feinstein complies with the
rules and guidelines of the Ethics Committee."
Mr. Duran also said Mr. Blum
"is not involved in the day-to-day operations of the company, nor does he
have any involvement in the company's contracting." Mr. Blum declined
through a spokesman to comment.
CBRE spokesman Robert McGrath said
the firm had $5 billion in revenues last year and was "well
positioned" to help the FDIC as the nation's largest commercial real
estate services company. Its pricing was at market rates after a highly
competitive bid process, he said.
"We believe the FDIC will
realize significant value from all the work we perform on their behalf,"
he said.
The contract process
In May, the FDIC began the formal
process of looking for help to manage and market its growing portfolio of
foreclosed real estate acquired from failed financial institutions nationwide.
It sent letters to 33 real estate firms and received proposals from 18.
In November, the FDIC signed a
contract with CBRE that could be worth tens of millions of dollars or more at a
time when real estate firms are scrambling for business in the distressed
economy.
CBRE said it was hired to act
"as a primary adviser" to the FDIC for its real estate portfolio
nationwide, according to a press release announcing the contract. The firm
called the FDIC a "major account."
Mr. Blum became chairman of CBRE
in 2001 and has played a major role in its corporate business strategies. He
led a buyout of the company, first taking it private and then a few years later
taking it public again. He runs an investment management firm called Blum
Capital Partners, which controls the second largest block of publicly traded
CBRE stock - 38 million shares or 14.4 percent.
Mr. Blum, whose position as
chairman of CBRE is not full time, sets up partnerships through Blum Capital
Partners that invests money for its clients and its owners. He reported owning
more than $3 million in CBRE stock through various partnerships at the end of
2007, according to Mrs. Feinstein's personal financial disclosure statement.
CBRE's initial contract is for
three years. The FDIC has the option to extend it for three two-year periods,
records show. The contract calls for the real estate firm to be used "as
needed."
In March, the FDIC said it had
assigned CBRE 507 properties for disposal, valued at $221.7 million. In March,
the company already had 23 FDIC properties valued at $11 million under contract
to be sold.
Over the past 16 months, 50 banks
have failed and more are expected to close. As a result, nobody knows how much
CBRE will be able to earn over the life of the FDIC contract.
Blum and the stock
offering
The FDIC contract came at a good
time for CBRE. Even though it remains the world's largest commercial real
estate services firm, it was hit hard by the economic downturn. The company saw
its revenues and income slide in 2008 and its stock price tumbled from $24.50
in May to below $4 in November.
"Our third quarter results
reflected the extremely challenging market conditions, which continued to
deteriorate globally," Brett White, president and chief executive officer
of CBRE, said in early November.
A few days later, CBRE raised $207
million through a stock offering that sold for $3.77 a share. Mr. Blum's
investment partnerships bought 10.6 million shares at the market price of
$3.77. The stock offering was announced a couple of days before the signing of
the FDIC contract.
In its November prospectus for the
stock sale, CBRE warned potential investors that the company could be hurt by
the money problems of its clients, noting that federal regulators had recently
taken over one of its "significant" clients, Washington Mutual, the
nation's largest savings and loan.
The terms of the contract
CBRE won a highly favorable
contract, according to real estate experts who reviewed the terms at the
request of The Times.
CBRE is to be paid under a
three-tiered system with sliding rates, according to a rate proposal provided
to The Times under a Freedom of Information Act (FOIA) request. For starters,
CBRE gets to charge a setup fee of $450 for each residential property and $600
for each commercial property it takes over from the FDIC.
"That is highly
unusual," said Ms. Kenner, the Colorado-based foreclosure expert. She said
she does not collect a separate setup fee and was expected to do such work as
part of her commission.
The FDIC said: "The setup fee
is for setting up the assets in the contractor's database and the FDIC
database. In the private sector, a similar fee is usually charged as an
administrative fee, document preparation fee, or asset handling fee."
Milt Shaw, senior vice president
of LPS Asset Management Solutions, which manages nearly 20,000 foreclosed
properties for banks and other clients, said his firm did not charge setup
fees. Others in the industry also called the fee unusual.
CBRE also gets to collect a
monthly administrative management fee of at least $200 for each residential and
$1,600 for each commercial property in its inventory. Ms. Kenner and Mr. Shaw
said fees for management services often come out of the sales commissions at
closing.
But the biggest fees for CBRE will
come from the sales.
CBRE charges commissions of 6
percent of the sales price on residential and 7 percent on commercial
properties worth up to $1 million. It also is entitled to an incentive fee of
as much as 2 percent of the sales price for properties it sells within six
months. The incentives start at two percent for residential properties worth
between $25,001 and $500,000 and for commercial properties worth between
$25,001 and $1 million before dropping to 1.5 percent. The percentages for both
the commissions and incentives become smaller as prices get higher.
Six percent commission is a
standard rate for residential property in the private sector, but some experts
said many buyers negotiate a lower fee.
Ms. Kenner, who deals in
foreclosed residential properties, said she charges 5 percent to 6 percent,
depending on the market, adding that she shares the fee with the buyer's agent
and often with the asset management company.
Mr. Shaw said incentive fees are
not that frequent in the private sector, but when he sees them they are usually
smaller than 2 percent and pegged for a specific market.
The FDIC defended the fees, saying
they were "intended to incentivize the contractors to sell the assets as
quickly as possible for the benefit of the FDIC and to protect the insurance
fund."
"The private sector normally
does not have an urgency to sell assets quickly and thus do not normally have
any incentive to do so," the agency said.
Mr. Shaw disagreed and said his
private sector clients - banks and loan servicers - also wanted their
properties sold quickly.
CBRE has the chance to collect the
largest percentage of the sales price for properties worth $25,000 or less,
under a flat fee agreement far more generous than the private sector.
Under the FDIC contract, CBRE
charges a $5,000 sales commission for each property and can collect an
additional $2,500 incentive fee if they sell it in under six months. In other
words, they can collect as much as $7,500 on the sale of a property worth
$25,000 or less - which works out to a sales commission of 30 percent or more.
Ms. Kenner said she charges $2,000
to $2,500 to sell properties worth $25,000 or less. Another firm, Prescient
Inc., which won a similar FDIC contract at the same time as CBRE, charges a
$1,948 commission and a $485 incentive fee.
"I think it is a little
egregious," Mr. Shaw said of the CBRE compensation deal for small
properties.
CBRE said its rates were market
and commission money would be shared with other agents who co-listed the
properties or represented the buyers.
Feinstein and the
legislation
Mrs. Feinstein introduced her bill
Jan. 6, seeking $25 billion from the government's bailout fund know as the
Troubled Asset Relief Program to help bankroll an FDIC proposal to
systematically prevent home mortgage foreclosures by expediting loan workouts
and expanding federal loan guarantees.
The proposal was a pet project of
FDIC Chairman Sheila C. Bair, who wanted expand a program the agency had used
successfully with borrowers of the failed IndyMac bank to help reduce
foreclosures.
Records show Mrs. Feinstein's
public support for the Bair proposal surfaced Oct. 30 in letter to Mrs. Bair as
CBRE was still competing for the FDIC contract. Mrs. Bair responded in late
November pointing out that she had not been able to get the Treasury Department
to adopt her program and authorize bailout funds for it, according to the
correspondence released under FOIA.
Mrs. Feinstein's legislation would
have required the government to finance Mrs. Bair's foreclosure plan.
"The FDIC estimates that
roughly 2.2 million home loans, worth $444 billion, could be modified under
this plan, with 1.5 million foreclosures avoided," she said in her
statement on the bill.
Her spokesman said she introduced
the foreclosure relief bill not at Mrs. Bair's request but after becoming aware
from news accounts of the effect of the mortgage crisis, especially on
California homeowners.
"California has one-third of
all foreclosures in the nation, and the need to provide relief to struggling
American families is the sole motivation for this bill," Mr. Duran said.
FDIC spokesman Andrew Gray said
the agency's proposal got bipartisan backing.
Rep. Maxine Waters, California
Democrat, twice introduced a similar bill in the House. Both bills by Mrs.
Feinstein and Mrs. Waters have been superceded by Mr. Obama's economic stimulus
plan to aid homeowners, which adopts parts of the FDIC concept.
Mr. Gray said none of the FDIC
board members such as Mrs. Bair played a role in the selection of CBRE because
there is a fire wall between them and contracting decisions. He said Mrs. Bair
first learned of the contract by reading the newspaper.
A question of ethics... FEINSTEIN THE OLD WHORE!
As for Mrs. Feinstein, Mr. Duran
said she did not learn of the contract until The Times asked her office about
it in late January, even though the contract was publicly announced by the
company and had been mentioned in an article in the Los Angeles Times in late
November. Her spokesman said her office was not aware of the article.
Ethics analysts question whether
Mrs. Feinstein had an obligation to track her husband's business dealings with
the government to avoid any appearance of a conflict of interest.
"I find it amazing that they
did not know that CB Richard Ellis had gotten the FDIC contract," said Mr.
Cooper, the ethics expert and former regulator. "Why wasn't she or a staff
person regularly watching for possible conflicts?"
Other experts said they do not
think that the Senate Ethics Committee will take any action because Mrs.
Feinstein's legislation did not directly financially benefit her husband and
was aimed at solving a problem affecting a broad section of America.
Robert L. Walker, a former chief
Senate Ethics Committee counsel, said the Senate conflict rule is so narrow
that it "almost requires a senator's sponsorship of a private bill
resulting in some personal or family benefit before a violation of the rule
would be found."
Mr. Walker added that the Senate
usually relies on the senator to police against improper appearances, but the
policy "assumes that a senator and his or her staff will know about and
remain alert to investments and other financial ties, including family
financial ties, that could be the basis of such appearance concerns."
Mr. Duran said Mrs. Feinstein and
Mr. Blum make "an intensive effort" to maintain a wall between their
financial interests.
"Her staff carefully reviews
all votes," he said. "Senator Feinstein complies with all required
congressional disclosure requirements. She follows the guidance of the ethics
committee and its requirements."
Mrs. Feinstein, who declined to
answer detailed question about the steps she takes to avoid conflicts, is one
of the wealthiest members of Congress, mainly from Mr. Blum's holdings.
Together, they are worth at least $52.3 million, according to her 2007 personal
financial disclosure forms filed with the Senate and analyzed by the
nonpartisan Center for Responsive Politics, which monitors money and politics.
"When a spouse has so many
business interests, it will always raise questions about how contracts are
acquired or decisions made," said Ms. Sloan, CREW's executive director
On fifth anniversary of Wall Street crash, Obama tries the Big Lie technique
17 September 2013
On Monday, US President Barack Obama marked the fifth anniversary of the Wall Street crash of September 15, 2008 with a White House speech that only underscored the unbridgeable chasm that separates the entire political establishment from the broad mass of working people.
Even as he spoke, the stock market was soaring to new highs on the news that Obama’s expected choice to succeed Ben Bernanke as chairman of the Federal Reserve, Lawrence Summers, had removed himself from consideration because of opposition from Wall Street.
Forbes magazine reported that the wealth of the 400 richest Americans had climbed to $2 trillion, a jump from $1.7 trillion in 2012.
With corporate profits at record highs, CEO pay once again hitting the tens and hundreds of millions, and the concentration of wealth the greatest since 1928, Obama boasted of the great success of his economic policies in restoring “security and opportunity for the middle class.”
With breathtaking cynicism—and contempt for the intelligence of the American people—Obama presented himself as single-mindedly focused on “my number one priority since the day I took office”: fighting for the so-called “middle class.” (There is, according to the mythology of the American ruling class, no working class in the United States, even though America is the most economically unequal of all industrialized countries).
Employing the technique of the Big Lie, Obama described his response to the financial crisis as follows: “We put people back to work repairing roads and bridges, to keep teachers in our classrooms, our first responders on the streets. We helped responsible homeowners modify their mortgages so that more of them could keep their homes. We helped jumpstart the flow of credit to help more small businesses keep their doors open. We saved the American auto industry… we took on a broken health care system … We put in place tough new rules on big banks … And what all this means is we’ve cleared away the rubble from the financial crisis and we’ve begun to lay a new foundation for economic growth and prosperity.”
No. The Obama administration categorically rejected any program of public works to hire the unemployed and refused to aid bankrupt state and local governments, resulting in the layoff of hundreds of thousands of teachers, firefighters and other public employees. As a result, mass unemployment is a permanent fixture, and the labor force participation rate is the lowest in 35 years. Moreover, the vast majority of new jobs created under Obama—still 2 million below the total before the crisis—are low-wage and part-time.
The administration refused to halt home foreclosures or force banks to reduce loan principals, allowing the banks to throw millions of families out onto the street.
While continuing and vastly expanding the bank bailout begun under Bush, Obama refused to impose any conditions on the money stolen from taxpayers, allowing the bankers to use government funds to speculate rather than provide loans to small businesses. The result was a wave of small business failures that continues to the present.
Obama forced General Motors and Chrysler into bankruptcy in order to impose plant closures, tens of thousands of layoffs, cuts in workers’ benefits, and a 50 percent pay cut for new-hires. The wage-cutting in the auto industry was the signal for an assault on wages and benefits in every sector of the economy, public as well as private.
Obama passed a health care overhaul devoted to cutting costs for corporations and the government by rationing health services, drugs, medical tests and procedures on a class basis. Millions of workers will see their coverage slashed while the health care giants and insurance companies enjoy windfall profits.
The Dodd-Frank financial “reform” bill passed in 2010 is a joke. A compendium of half measures meant to provide a fig leaf of reform while leaving the existing financial system intact, it largely remains a dead letter. Provisions such as the “Volcker Rule,” which would restrict—but not end—the legal ability of banks to speculate on their own accounts with depositors’ money, have not been enacted because of opposition from Wall Street.
Not a single leading bank executive has been criminally prosecuted, let alone jailed, for rampant fraud and criminality both before and after the 2008 crash. Over the past five years, bank scandals have proliferated—Libor-rigging, foreclosure fraud, concealing speculative losses, drug money laundering—with no serious consequences for the criminals. Not only have the biggest banks not been broken up, they have been allowed to grow even bigger and strengthen their grip on all aspects of economic and political life.
As for the “new foundation for growth and prosperity,” the offloading of the bad debts of the banks to the government and the massive money printing by the Federal Reserve to subsidize Wall Street have created the conditions for a financial crash of even greater proportions than the debacle of 2008.
The bankrupting of governments has, meanwhile, been used, in the US and around the world, to justify the launching of an historic assault on social programs and the jobs and living standards of the working class.
Obama has spearheaded a social counterrevolution, utilizing the economic crisis to turn the wheel of history back to levels of exploitation and poverty last seen 100 years ago.
The centerpiece of this assault in the US is the bankruptcy of Detroit, backed by the White House, which is being used to destroy the pensions and health benefits of city workers, privatize and slash city services, and sell off public assets, from the water department to the Detroit Institute of Arts. Detroit will set a precedent for cities across the country and internationally.
In his speech, Obama made passing reference to the further growth of social inequality during his tenure, noting that “the top one percent of Americans took home twenty percent of the nation’s income last year, while the average worker isn’t seeing a raise at all.” Typically, however, he spoke as though he was an innocent bystander and the further enrichment of the financial aristocracy had nothing to do with himself or his own policies.
In reality, the single-minded focus of Obama’s domestic agenda from day one has been to enable the ruling class to recover its losses from the crash and exploit the crisis to amass even greater wealth. Even as he sought in his speech to blame congressional Republicans for obstructing his supposed campaign in behalf of the middle class, Obama signaled that he intended to intensify his attack on social programs for workers and grant new windfalls to big business.
Boasting that deficits were falling at the fastest rate since the end of World War II, he said, “there’s not a government agency or program out there that still can’t be streamlined … So I do believe we should cut out programs that we don’t need.”
He reiterated his support for “reforms” to Medicare and Social Security, including raising the retirement age for Medicare, introducing a form of means testing, and cutting cost-of-living raises for Social Security beneficiaries. At the same time, he repeated his support for a massive cut in corporate taxes.
Obama’s speech will not fool the vast majority of workers, whose anger is increasingly focusing on the White House and the former candidate of “hope” and “change.” This opposition must be mobilized on the basis of a clear, independent, socialist political program, which starts from the need to build a political movement in opposition to the entire political establishment and the capitalist system it defends.
Barry Grey
On fifth anniversary of Wall Street crash, Obama tries the Big Lie
technique
17 September 2013
On Monday, US President Barack Obama marked the fifth anniversary of the
Wall Street crash of September 15, 2008 with a White House speech that only
underscored the unbridgeable chasm that separates the entire political
establishment from the broad mass of working people.
http://mexicanoccupation.blogspot.com/2013/09/crony-capitalism-obama-celebrates-5.html
Forbes magazine reported that the wealth of
the 400 richest Americans had climbed to $2 trillion, a jump from $1.7 trillion
in 2012.