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Global banking giant HSBC for years catered to a motley crew of weapons dealers, tax evaders, tin-pot dictators and celebrities, using its private Swiss arm to shield accounts worth more than $100 billion. Documents obtained and analyzed by the International Consortium of Investigative Journalists (ICIJ) reveal how HSBC (HSBC) used the secretive Swiss banking system to conceal the identities of accounts holders, and in many cases, help depositors avoid paying taxes.

ICIJ's findings are based on data turned over to French authorities by former HSBC employee Hervé Falciani in 2008. The files were later obtained by the newspaper Le Monde and shared among other media outlets. ICIJ said the leaked documents show that HSBC "repeatedly reassured clients that it would not disclose details of accounts to national authorities" and even "discussed with clients a range of measures that would ultimately allow clients to avoid paying taxes in their home countries." In a statement provided to ICIJ, HSBC said that its Swiss private bank has undergone a "radical transformation in recent years," including reforms that will make it more difficult for clients to evade taxes or launder money. "We acknowledge that the compliance culture and standards of due diligence in HSBC's Swiss private bank, as well as the industry in general, were significantly lower than they are today," the statement said.

Pope Francis set up a special commission of inquiry on Wednesday to reform the Vatican bank, his boldest move yet to get to grips with an institution that has embarrassed the Catholic Church for decades. The high-powered, five-member panel, which includes four prelates and a female Harvard law professor, will report directly to him, bypassing the Vatican bureaucracy that itself has sometimes been hit by allegations of scandal and corruption.The Institute for Works of Religion (IOR), as the bank is formally known, has long been tarnished by accusations that it has failed to meet international transparency standards intended to combat money laundering and tax evasion.

Five years after the US financial crisis forced the massive government TARP bailout, the US corporate culture remains toxic and breeding crime, the watchdog for the bailout program said Tuesday.More than 300 people in the banking, housing and securities industries are in the hands of the criminal system, whether it is a charge, a conviction or a sentencing, the Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) said in a quarterly report to Congress."The financial system has stabilized, but the toxic corporate culture that led up to the crisis and TARP has not sufficiently changed," said Christy Romero, the special inspector general."At the core of the crisis was a pervasive culture at institutions of rampant risktaking and greed combined with significant unchecked power," she said.

SIGTARP was launched in early 2009 to detect fraud in the massive TARP bailout program. Within weeks of the Lehman Brothers bankruptcy, the government set up the $700 billion TARP to prop up the collapsing financial system. In 2010, the cap on the Treasury's authority to purchase and guarantee assets under TARP was reduced to $475 billion.To date, 65 people have been sentenced to prison for their crimes investigated by SIGTARP and its law enforcement partners, 112 have been convicted and await sentencing and 154 individuals have been criminally charged and face trial on those charges, the report said.In addition, 60 people have been banned from their industries."Many of these defendants were at the highest levels of banks or companies that applied for or received TARP bailout money. They were trusted to exercise good judgment and make sound decisions. However, they abused that trust. Many times they abused that trust for their own personal benefit," the report said.

As of September 30 Treasury had $30.7 billion in write-offs, losses or money not collectible from the program, according to the report."Treasury's write-offs and realized losses are money that taxpayers will never get back. Treasury generally expects the amounts currently not collectible will also be lost," the agency said.The watchdog was harshly critical of the Treasury's oversight of the Hardest Hit Fund, set up in February 2010 to help families in places hurt the most by the housing crisis.The Treasury allocated $7.6 billion in TARP funds for the HHF program in 18 states and Washington, DC, administered by local authorities.But states have reduced their proposed numbers of homeowners needing help, and the Treasury has ignored the SIGTARP's conclusions of an audit reported in April 2012.

“All of the investment banks, up in New York and D.C., they should have gone to jail.” That isn’t a quote from an Occupy Wall Street protester or Senator Elizabeth Warren. That’s a common campaign slogan repeated by Dave Brat, the Virginia college professor who scored one of the biggest political upsets in over a century by defeating Majority Leader Eric Cantor in the Republican primary last night. The national media is buzzing about Brat’s victory, but for all of the wrong reasons.

Did the Tea Party swoop in and help Brat, as many in the Democratic Party are suggesting? Actually, the Wall Street Journal reports no major Tea Party or anti-establishment GOP group spent funds to defeat Cantor. Did Cantor, the only Jewish Republican in Congress, lose because of his religion, as some have suggested? There’s no evidence so far of anti-Semitism during the campaign. Was Cantor caught flatfooted? Nope; Cantor’s campaign spent close to $1 million on the race and several outside advocacy groups, including the National Rifle Association, the National Realtors Association and the American Chemistry Council (a chemical industry lobbying association) came in and poured money into the district to defeat Brat. The New York Times claims that Brat focused his campaign primarily on immigration reform. Brat certainly made immigration a visible topic in his race, but Republic Report listened to several hours of Brat stump speeches and radio appearances, and that issue came up far less than what Brat called the main problem in government: corruption and cronyism. Brat told Internet radio host Flint Engelman that the “number one plank” in his campaign is “free markets.” Brat went on to explain, “Eric Cantor and the Republican leadership do not know what a free market is at all, and the clearest evidence of that is the financial crisis … When I say free markets, I mean no favoritism to K Street lobbyists.” Banks like Goldman Sachs were not fined for their role in the financial crisis — rather, they were rewarded with bailouts, Brat has said.

rat, who has identified with maverick GOP lawmakers like Representative Justin Amash of Michigan, spent much of the campaign slamming both parties for being in the pocket of “Wall Street crooks” and D.C. insiders. The folks who caused the financial crisis, Brat says, “went onto Obama’s rolodex, the Republican leadership, Eric’s rolodex.” During several campaign appearances, Brat says what upset him the most about Cantor was his role in gutting the last attempt at congressional ethics reform. “If you want to find out the smoking gun in this campaign,” Brat told Engelman, “just go Google and type the STOCK Act and CNN and Eric Cantor.” (On Twitter, Brat has praised the conservative author Peter Schweizer, whose work on congressional corruption forced lawmakers into action on the STOCK Act.) The STOCK Act, a bill to crack down on insider trading, was significantly watered down by Cantor in early 2012. The lawmaker took out provisions that would have forced Wall Street “political intelligence” firms to register as traditional lobbyists would, and removed a section of the bill to empower prosecutors to go after public officials who illegally trade on insider knowledge. And Brat may be right to charge that Cantor’s moves on the STOCK Act were motivated by self interest. Cantor played a leading role in blocking legislation to fix the foreclosure crisis while his wife and his stock portfolio were deeply invested in mortgage banks.

The massive consolidation of wealth, combined with the removal of any limits on money in campaigns, has allowed for the purchase of our government. Today I am publishing a comprehensive and important guest essay, The Purchase of Our Republic, by longtime correspondent Y. Falkson.

A federal judge on Thursday ordered the release of an independent monitor’s review of HSBC’s internal cleanup after a landmark $1.92 billion settlement for laundering drug money and for sanctions violations. The U.S. Justice Department and the bank had claimed that disclosing the report could harm law enforcement efforts and provide criminals with a “road map” to holes in HSBC’s defenses against money laundering. But U.S. District Judge John Gleeson ruled that the court and the public had a right to know whether HSBC was living up to its agreement to improve internal controls and merited a deferral of prosecution by the government.

Gleeson also said it was “equally appropriate and desirable for the public to be interested and informed now in the progress” of the HSBC settlement. HSBC in 2012 reached a landmark settlement with the federal government, admitting that it had deliberately laundered funds for drug cartels and countries under trade sanctions. Prosecutors described the settlement as a “sword of Damocles” hanging over HSBC. Should the bank fail to improve, it would face prosecution for unbridled financial wrongdoing. A condition of the settlement was that the bank submit to extensive outside review of its reform efforts. The former New York State ethics chief Michael G. Cherkasky was appointed as the HSBC monitor in 2013. A leaked copy of his report recounted instances of U.S. bank managers bullying and shouting at compliance team members, and drew attention to the bank’s dealings with clients that had possible links to terrorism, according to Bloomberg.

Wells Fargo WFC -9.22%Wells FargoWFC$58.16$-5.91(-9.22%)As of 02/06/2018, 01:01am EST is facing far more than a fine for its fake accounts scandal, in which employees at the lender's branches across the country opened over a million fraudulent checking and credit card accounts to hit their numbers. Late on Friday, the Federal Reserve decided to restrict growth at America's third-largest bank by assets until its risk and governance is improved. The order, which also called for a revamp of Wells Fargo's board of directors, sent the bank reeling in early trading Monday. Wells Fargo shares plunged 9% lower in Monday trading, erasing most of its gains over the past 12 months. For its top shareholder, Warren Buffett's Berkshire Hathaway, the Fed-inspired stock slide meant its Wells Fargo holdings lost over $2.7 billion in value. "We cannot tolerate pervasive and persistent misconduct at any bank and the consumers harmed by Wells Fargo expect that robust and comprehensive reforms will be put in place to make certain that the abuses do not occur again," said chair Janet L. Yellen on Friday. The order was her last as head of the Federal Reserve. On Monday, successor Jerome Powell was sworn in. Added Yellen, "the enforcement action we are taking today will ensure that Wells Fargo will not expand until it is able to do so safely and with the protections needed to manage all of its risks and protect its customers." In September 2016, Wells Fargo paid a $185 million fine to the Consumer Financial Protection Bureau after the agency found branch bankers had opened well over a million fake accounts, which generated millions of dollars in fees to the lender. When the scandal, which occurred over almost a decade, was first revealed, Wells Fargo and its board didn't immediately overhaul their leadership, or sanction top executives in the divisions where fake accounts were created. Only after significant public outcry, in addition to a widening scope of the scandal, did Wells Fargo begin a revamp, firing CEO John Stumpf and clawing back bonuses for numerous executives. Backer Warren Buffett later said in an appearance on CNBC the bank and its leadership had misjudged the severity of the problem.

In addition to harsh words, the Fed is ordering a sanction of almost unprecedented severity. It will restrict the bank's growth until its governance and risk management improve, though it will allow Wells to continue current operations from taking deposits to offering loans.

Three Wells Fargo long-standing board directors, John Chen, Lloyd Dean and Enrique Hernandez, will likely retire at the firm's annual meeting as part of the Fed's additional order for a refreshment of four board directors. Analysts did not brush off the Fed's move, as they have large fines coming out of the crisis.

My favorite story indicating the depth and degree of Obama’s loyalty to the wealthy Few comes from the spring of 2009. In his important book Confidence Men: Wall Street, Washington, and the Education of a President (2011), the Pulitzer Prize-winning author Ron Suskind tells a remarkable story from March of 2009. Three months into Barack Obama’s supposedly progressive, left-leaning presidency, popular anger at Wall Street was intense and the nation’s leading financial institutions were weak and on the defensive in the wake of the financial collapse and recession they had created. The new president called a meeting of the nation’s top 13 financial executives at the White House. The banking titans came into the meeting full of dread. As Suskind noted: “They were the CEOs of the thirteen largest banking institutions in the United States… And they were nervous in ways that these men are never nervous. Many would have had to reach back to their college days, or even grade school, to remember a moment when they felt this sort of lump-in-the-throat tension…As some of the most successful men in the country, they weren’t used to being pariahs… [and] they were indeed pariahs. The populist backlash against the financial sector—building steadily since September—was finally beginning to cause grave discomfort on Wall Street. As unemployment ballooned and credit tightened, the country began to look inward, toward the origins of the panic and its disastrous consequences.”

In the end, however, the anxious captains of high finance left the meeting pleased to learn that Obama was totally in their camp. For instead of standing up for those who had been harmed most by the crisis—workers, minorities, and the poor – Obama sided unequivocally with those who had caused the meltdown. “My administration is the only thing between you and the pitchforks,” Obama said. “You guys have an acute public relations problem that’s turning into a political problem. And I want to help…I’m not here to go after you. I’m protecting you…. I’m going to shield you from congressional and public anger.” For the banking elite who destroyed millions of jobs in their lust for profit, there was, as Suskind puts it, “Nothing to worry about. Whereas [President Franklin Delano] Roosevelt had [during the Great Depression] pushed for tough, viciously opposed reforms of Wall Street and famously said ‘I welcome their hate,’ Obama was saying ‘How can I help?’” As one leading banker told Suskind, “The sense of everyone after the meeting was relief. The president had us at a moment of real vulnerability. At that point, he could have ordered us to do just about anything and we would have rolled over. But he didn’t – he mostly wanted to help us out, to quell the mob.” When “the bankers arrived in the State Dining Room,” Suskind notes, “Obama had them scared and ready to do almost anything he said…. An hour later, they were upbeat, ready to fly home and commence business as usual” (Confidence Men).

This remarkable episode happened in the White House in a time when, to repeat, the Democrats held the majority in both houses of Congress along with an angry populace ready with good reason for Wall Street and 1% blood. And what did the populace get from this seemingly progressive alignment of the stars? The venerable left liberal journalist William Grieder put it very well in a March 2009 Washington Post Op-Ed: “a blunt lesson about power, who has it and who doesn’t.” Americans “watched Washington rush to rescue the very financial interests that caused the catastrophe. They learned that government has plenty of money to spend when the right people want it. ‘Where’s my bailout,’ became the rueful punch line at lunch counters and construction sites nationwide. Then to deepen the insult, people watched as establishment forces re-launched their campaign for ‘entitlement reform’ – a euphemism for whacking Social Security benefits, Medicare and Medicaid.”

s a starting point, we think the Proposed Rule is simply too tepid.” That was how Senators Jeff Merkley and Carl Levin opened their February 2012 comment letter to federal banking regulators about the “Volcker rule,” designed to prevent large banks from making risky proprietary trades for their own profit, the kinds of trades that nearly took down the financial system in 2008. The senators, who authored the rule in Congress, were displeased about a number of loopholes added to the proposal, which they said did not “fulfill the law’s promise.” They demanded that regulators “draw brighter lines, remove unnecessary complexities, and enable cost-effective, consistent enforcement.”Twenty months later, five regulators will today finalize the Volcker rule, and Merkley, for one, is pleased with the result. “I believe the loopholes inherent in that [2012] draft have been significantly reduced or eliminated,” he said in an interview on the eve of the final votes. “I have a much more positive feeling about what will be voted on.” 

The tougher rule is a pleasant surprise, given how reliably Wall Street lobbyists have gutted such efforts in the past. For once, the hard work of members of Congress, advocates, and the public actually produced something that could work. But if you view financial reform like a football game, today’s votes kick off the third quarter of a contest destined for 34 consecutive overtimes. Today’s vote mostly triggers an extended period of data collection and guideline-setting, giving mega-banks many future opportunities to water down the rules. And even if implementation wraps up strongly—as it certainly could—regulatory spine will be needed to prevent another financial crisis. As Merkley noted, in matters like this, “you need eternal vigilance.” And, in Washington and on Wall Street, vigilance has often been anything but.

Seizure of 160 computer flash sticks revealed the inside story of Isis, the band of militants that came from nowhere with nothing to having Syrian oil fields and control of Iraq's second city

BRUSSELS — Amid a growing outcry over American snooping on foreigners that threatens to cloud European-U.S. trade talks and President Barack Obama’s visit to Berlin, the European Union’s top justice official has demanded in unusually sharp terms that the United States reveal what its intelligence is doing with personal information of Europeans gathered under the Prism surveillance program revealed last week.

Viviane Reding, the Union’s combative commissioner of justice, told Attorney General Eric Holder in a letter sent on Monday evening that individual citizens of European countries had the right to know whether their personal information had been part of intelligence gathering “on a large scale.” In the letter, seen Tuesday by the International Herald Tribune, she also asked what avenues were available to Europeans to find out whether they had been spied on, and whether they would be treated similarly to U.S. citizens in such cases. “Given the gravity of the situation and the serious concerns expressed in public opinion on this side of the Atlantic, you will understand that I will expect swift and concrete answers,” Mrs. Reding wrote.

Speaking for a continent where snooping carries ghastly echoes of fascist or communist regimes, Mrs. Reding challenged Mr. Holder to answer a list of detailed questions by Friday, when they are expected to speak face-to-face in Dublin at a ministerial meeting scheduled before the Prism spy operation came to light. In Berlin, where Mr. Obama will speak next week before the Brandenburg Gate, privacy is a highly sensitive political issue and the Prism revelations have stirred a furor. “You can be sure that this will be one of the things the chancellor addresses when President Obama is in Germany,” said Steffen Seibert, spokesman for Angela Merkel, who grew up in the former Communist East.