Skip to main content

Home/ Socialism and the End of the American Dream/ Group items tagged geithner

Rss Feed Group items tagged

Filter: All | Bookmarks | Topics Simple Middle
Paul Merrell

Jamie Dimon's $13 Billion Secret | The Nation - 0 views

m.thenation.com/...jamie-dimons-13-billion-secret

financial-collapse banksters fraud litigation settlement JPMorgan

shared by Paul Merrell on 23 Aug 14 - No Cached
  • In the end, the abject fear of Ben Wagner got Jamie Dimon to cave.For much of 2013, Dimon, the chairman and chief executive of the formidable JPMorgan Chase & Company, was telling anyone who would listen that it was unfair and unjust for federal and state prosecutors to blame him and his bank for the manufacture and sale of mortgage-backed securities that occurred at Bear Stearns & Company and at Washington Mutual in the years leading up to the financial crisis. When JPMorgan Chase bought those two failing firms in 2008, Dimon argued, he was just doing what Ben Bernanke, Hank Paulson and Timothy Geithner had asked him to do. Why should his bank be held financially accountable for the bad behavior at Bear and WaMu?It was a clever argument—and wrong. Dimon's relentless effort to spin his patriotic story soon collided with the fact that Wagner, the US Attorney for the Eastern District of California, had uncovered evidence that JPMorgan itself was guilty of many of the same greedy and irresponsible behaviors. Piles of subpoenaed documents and e-mails revealed that JPMorgan bankers and traders had underwritten billions of dollars' worth of questionable mortgage-backed securities that Dimon had been telling everyone had originated at Bear Stearns and WaMu. Worse, the bad behavior had occurred on Dimon's watch.
  • The likelihood that the Justice Department would file Wagner's civil complaint last fall—exposing publicly for the first time the litany of wrongdoing at JPMorgan and threatening to push it off the perch that Dimon had so artfully constructed for it over the years—ultimately brought Dimon to the table. On September 26, just weeks after the Justice Department shared a draft copy of Wagner's complaint with Dimon, the two sides arranged for a summit meeting between Dimon and Attorney General Eric Holder. By mid-November, the bank had agreed to pay $13 billion in a comprehensive settlement of mortgage-related securities claims with various branches of the federal government and a group of states, led by the attorneys general of New York, California, Illinois, Massachusetts and Delaware.It was the largest financial settlement of all time, and it kept Wagner's complaint away from the prying eyes of the public. One thing is clear: Dimon's claim that his own bankers and traders had done nothing wrong in the years leading up to the financial crisis wasn't true. "The investigators and the lawyers were uncovering very viable evidence," explains Associate Attorney General Tony West, who headed up the settlement negotiations on behalf of the Justice Department. "I think there was recognition that we had enough evidence there that would support the complaint and would support a robust lawsuit."
  • [A disclosure of my own: after JPMorgan Chase fired me as a managing director in January 2004, I brought—and lost—a wrongful-dismissal arbitration against the bank. Separately, I remain in litigation with the bank as the result of a soured investment I made in 1999.]
  • ...1 more annotation...
  • Dimon was more circumspect. In a conference call the day the settlement was announced, he mostly kept quiet while Marianne Lake, the firm's CFO, led financial analysts through the details, including how $7 billion of the $13 billion fine would be tax-deductible.
  • Paul Merrell on 23 Aug 14
     
    In a Matt Taibbi-quality lengthy report, William Cohan takes the reader inside the lengthy negotiations of JPMorgan's $13 billion settlement with state and federal prosecutors. JPMorgan admitted to criminal wrongdoing, and the settlement does not include immunity from criminal prosecution for anybody. But the author notes that there is not even a hint that anyone is working on criminal charges. There's a lot of discussion of dissension within the ranks of different state and federal attorneys involved. The article paints Ben Wagner, the US Attorney for the Eastern District of California, as the hero.  In my book, no one involved deserves hero status because no criminal charges have been filed against any JPMorgan managers or board members, hence there is still no incentive for any of the fraudsters who brought down the economy in 2008 to behave differently in the future. JPMorgan emains not too big to fail but too politically connected for its principals to be jailed. According to the article, the government lawyers had iron-clad proof that a group of JPMorgan managing directors had been informed that pools of mortages they were planning to buy were toxic but "buy two of the loan pools anyway, including those with the squirrelly mortgages. JPMorgan then proceeded to bundle "hundreds of millions of dollars of loans from those pools into one security." Wagner found that between the start of 2006 and the middle of 2007-when the mortgage securitization frenzy was at its peak-JPMorgan packaged and sold securities containing thousands of mortgages that were rated by a third-party evaluator to be of extremely low quality, meeting few, if any, of the bank's underwriting standards." If true, that is very serious fraud deserving of the directors' prosecution for criminal fraud and lengthy prison sentences.   The article touches on A.G. Holder's too big to jail argument but that argument, in my opinion, deserves no credibility before antitrust actions are filed to c
Paul Merrell

European Banks vs. Greek Labour   :  Information Clearing House - ICH - 0 views

www.informationclearinghouse.info/article41100.htm

class-warfare Greece banksters Spain Portugal Ireland bailing-out-banks

shared by Paul Merrell on 27 Feb 15 - No Cached
  • PERIES: So, Michael, these international banks represented by the finance ministers now in Brussels, when they were in crisis and we the public treasury bailed them out, they had no problem with that. Why are they now refusing to assist Greece at a time of need when in fact some politicians and even the troika is being more receptive to what Greece is saying? HUDSON: Because what's at issue really is a class war. It's not so much Germany versus Greece, as the papers say. It's really the war of the banks against labor. And it's a continuation of Thatcherism and neoliberalism. The problem isn't simply that the troika wants Greece to balance the budget; it wanted Greece to balance the budget by lowering wages and by imposing austerity on the labor force. But instead, the terms in which Varoufakis has suggested balancing the budget are to impose austerity on the financial class, on the tycoons, on the tax dodgers. And he said, okay, instead of lowering pensions to the workers, instead of shrinking the domestic market, instead of pursuing a self-defeating austerity, we're going to raise two and a half billion from the powerful Greek tycoons. We're going to collect the back taxes that they have. We're going to crack down on illegal smuggling of oil and the other networks and on the real estate owners that have been avoiding taxes, because the Greek upper classes have become notorious for tax dodging.
  • Well, this has infuriated the banks, because it turns out the finance ministers of Europe are not all in favor of balancing the budget if it has to be balanced by taxing the rich, because the banks know that whatever taxes the rich are able to avoid ends up being paid to the banks. So now the gloves are off and the class war is sort of back. Originally, Varoufakis thought he was negotiating with the troika, that is, with the IMF, the European Central Bank, and the Euro Council. But instead they said, no, no, you're negotiating with the finance ministers. And the finance ministers in Europe are very much like Tim Geithner in the United States. They're lobbyists for the big banks. And the finance minister said, how can we screw up this and make sure that we treat Greece as an object lesson, pretty much like America treated Cuba in 1960?
  • Paul Merrell on 27 Feb 15
     
    Just as you've given up on society, life throws you some comedy. 
Paul Merrell

A coming crackdown on Federal Reserve power? - Jennifer Liberto - POLITICO - 0 views

www.politico.com/...eral-reserve-power-116267.html

banksters Fed reform

shared by Paul Merrell on 23 Mar 15 - No Cached
  • A move to shift power away from the New York Federal Reserve Bank is finding some powerful friends in Congress amid lingering worries that a key part of the central bank is too cozy with Wall Street. Two Republicans running the banking committees have both said they plan to explore proposals from the outspoken, former Dallas Federal Reserve Bank President Richard Fisher that would roll back a long-standing provision that gives the president of the New York Federal Reserve Bank an automatic position as vice chairman of a powerful committee and weaken New York’s oversight of Wall Street banks. Story Continued Below The politics may be ripe for chipping away at the power of the Federal Reserve, uniting liberals who want to crack down on Wall Street, Republicans who don’t like the Fed’s easy money policies and libertarians who are suspicious of the Fed altogether.
  • Fisher, who retired Thursday after 10 years at the Dallas Fed, wants to yank the New York Fed’s permanent position as vice chair of the all-powerful Federal Open Market Committee, the panel charged with making monetary policy decisions, which met Wednesday. While the New York Fed president could still participate in monetary policy discussions, he or she would no longer always get a vote. Fisher suggested the job should rotate among the regional Federal Reserve Banks every two years.
  • The move would upend the current structure, as the New York Fed has had a lock on that spot since 1936, thanks largely to its role as the infrastructure, which supplies the trading desk that carries out the Fed’s monetary policy decisions. Fisher is also proposing that other regional Fed banks oversee some of the Wall Street giants in a move aimed at addressing criticism the New York Fed missed warning signs of the financial crisis, is too soft on Wall Street and holds too much power and influence at the Fed. “The greatest concern appears to be the problem of regulatory capture by the largest and most powerful institutions,” Fisher said in a February speech in New York laying out his plan. Wall Street critics have been suspicious of the New York Fed since it and its then leader, Timothy Geithner, played a key role in responding to the 2008 financial crisis and the bailouts that entailed.
  • ...1 more annotation...
  • Late last year its current president, William Dudley, was hauled before the Senate Banking Committee after reports from ProPublica and NPR’s This American Life that focused on a New York Fed examiner who said her warnings about certain business practices and deals at Goldman Sachs were ignored or brushed aside by her superiors. She provided recordings of her dealings with Fed officials to back up her case. “We’ve got on tape higher-ups at the New York Fed calling off the regulators,” Warren told Dudley at the November hearing. “And I’m just asking the same kind of question — is there a cultural problem at the New York Fed? I think the evidence suggests that there is.”
‹ Previous 21 - 23 of 23
Showing 20▼ items per page