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Bill Black: The FBI’s 2010 Mortgage Fraud Report Reveals Why the Banksters Love Holder

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Yves here. Black has written the sort of post I particularly like. He’s given a close reading of the FBI’s latest (and tellingly, not all that recent) mortgage fraud report and parses what its use of language and its omissions say about its assumptions and priorities.

By Bill Black, the author of The Best Way to Rob a Bank is to Own One and an associate professor of economics and law at the University of Missouri-Kansas City. Cross posed from New Economic Perspectives

The Obama administration’s continuation of the Bush administration’s refusal to prosecute the elite banksters (or even the vastly lower status CEOs of the fraudulent mortgage bank) that drove the crisis has made it clear that the rule of law no longer applies to wide ranges of life and that crony capitalism will continue to reign.
One of the difficulties we have is that because the last two administrations have fanatical devotees of the cult of the Virgin Crisis – the myth that the ongoing crisis was the first in modern times conceived without sin (control fraud) – that it is exceptionally difficult to know what their creed is.

DOJ has refused to prosecute any elite banker for mortgage loan origination fraud. The rare prosecutions it has brought against senior officials of fraudulent loan originator (a large, but obscure regional mortgage bank: Taylor Bean) did not prosecute the officials for their fraudulent origination (or sale) of loans. They Taylor Bean officials were only prosecuted for their fraud against the TARP program – and only because Neil Barofsky (SIGTARP) made the criminal referral about that fraud and pushed relentlessly to force the Department of Justice to prosecute. With zero prosecutions of the massively fraudulent home lenders that drove the crisis to we are left with no information on why committing hundreds of thousands of frauds via the twin epidemics of loan origination fraud (inflating appraisals and making endemically fraudulent “liar’s” loans) is no longer a crime that the FBI investigates and DOJ prosecutes. No senior DOJ or FBI official, of course, is stupid enough to state openly why we no longer prosecute even the CEOs of long-bankrupt mortgage banks that led these accounting control frauds. The U.S. Attorney for Sacramento, one of the epicenters of accounting control fraud, was foolish enough to attempt to explain why he did not investigated or prosecute the banksters:

Benjamin Wagner, a U.S. Attorney who is actively prosecuting mortgage fraud cases in Sacramento, Calif., points out that banks lose money when a loan turns out to be fraudulent. “It doesn’t make any sense to me that they would be deliberately defrauding themselves,” Wagner said.

Wagner’s inability to keep his pronouns straight even when they were in the same sentence – “they” refers to the CEO, “themselves” refers to the bank the CEO is looting – was so embarrassing that he did not even try to respond to his critics. With no indictments of the bank CEOs for loan origination fraud and no statements by senior DOJ leaders about why they refuse to prosecute the leaders of the accounting control frauds that drove our last three major crises we are forced to guess at what went wrong at the FBI and DOJ.

This is the first in a series of columns that use the FBI’s 2010 Mortgage Fraud Report to make intelligent inferences about why the prosecutors have ceased prosecuting control frauds directed by senior financial leaders. To find that report on the FBI web site one searches for “mortgage fraud” and reads the following:

Mortgage Fraud

These scams hit us right where we live.

From foreclosure frauds to subprime shenanigans, mortgage fraud is a growing crime threat that is hurting homeowners, businesses, and the national economy. We have developed new ways to detect and combat mortgage fraud, including collecting and analyzing data to spot emerging trends and patterns. And we are using the full array of investigative techniques to find and stop criminals before the fact, rather than after the damage has been done.”

The first clause is schizophrenic. “Foreclosure fraud” is a massive anti-purchaser control fraud directed by the senior leadership of fraudulent banks. “Subprime” refers to one of the primary forms of “ammunition” used by the accounting control frauds whose fraudulent mortgage loan originations drove the financial crisis. But the FBI calls this form of fraud, which caused catastrophic losses mere “shenanigans.”

Definition of SHENANIGAN

1
: a devious trick used especially for an underhand purpose
2
a: tricky or questionable practices or conduct —usually used in plural
b: high-spirited or mischievous activity —usually used in plural

Examples of SHENANIGAN

1. students engaging in youthful shenanigans on the last day of school
2. an act of vandalism that went way beyond the usual shenanigans at summer camp

The trivialization of even elite white-collar crime is a problem that Henry Pontell and I have warned against, e.g.., White-Collar Criminology and the Occupy Wall Street Movement in The Criminologist, Vol. 37 #1. Henry N. Pontell and William K. Black. American Society of Criminology (January/February 2012)

As this series of columns will demonstrate, one of the consistent facts that emerges from the FBI’s 2010 Mortgage Fraud Report; albeit through consistent omission, is that the FBI implicitly assumes that this is our first Virgin financial crisis of the modern era. Even the concept of control fraud at financial institutions no longer exists at the FBI.

A related key truth also arises through consistent omission in the same FBI report – the banking regulatory agencies continue to play no role the FBI considers worthy of mention in identifying, reporting, and fighting mortgage fraud. Both omissions begin to become clear in the 2010 FBI report’s introduction.

2010 Mortgage Fraud Report: Year in Review

Scope Note

The purpose of this study is to provide insight into the breadth and depth of mortgage fraud crimes perpetrated against the United States and its citizens during 2010. This report updates the 2009 Mortgage Fraud Report and addresses current mortgage fraud projections, issues, and the identification of mortgage fraud “hot spots.” The objective of this study is to provide FBI program managers and the general public with relevant data to better understand the threat posed by mortgage fraud. The report was requested by the Financial Crimes Section, Criminal Investigative Division (CID), and prepared by the Financial Crimes Intelligence Unit (FCIU), Directorate of Intelligence (DI).

This report is based on FBI; federal, state, and local law enforcement; mortgage industry; and open-source reporting. Information was also provided by other government agencies, including the U.S. Department of Housing and Urban Development-Office of Inspector General (HUD-OIG), the Federal Housing Administration (FHA), the Federal National Mortgage Association (Fannie Mae), the Federal Home Loan Mortgage Corporation (Freddie Mac), and the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN). Industry reporting was obtained from LexisNexis, Mortgage Asset Research Institute (MARI), RealtyTrac, Inc., Mortgage Bankers Association (MBA), Interthinx, and CoreLogic. Some industry reporting was acquired through open sources.
Mortgage fraud perpetrators include licensed/registered and non-licensed/registered mortgage brokers, lenders, appraisers, underwriters, accountants, real estate agents, settlement attorneys, land developers, investors, builders, bank account representatives, and trust account representatives.”

Note ten omissions and one dangerous inclusion in the introduction to FBI Mortgage Fraud Report for 2010. First, this is the most recent FBI Mortgage Fraud report. While the FBI felt the need to get updated analysis of mortgage fraud in 2009 and 2010 it has not updated the report since that time even as the statute of limitations is running out for many of the frauds.

Second, the long list of federal entities that provided “information” about “mortgage fraud” did not include the Federal Reserve, the FDIC, the OCC, and OTS – the four banking regulatory agencies that should have been the leading source of information on mortgage fraud. They had the duty to regulate the control frauds that drove the crisis. The Fed had the unique statutory authority under HOEPA (1994) to ban all “liar’s loans” – one of the twin epidemics of accounting control fraud by loan originators that drove the crisis. We know that the Fed collected data on these endemically fraudulent liar’s loans because they cited the data in 2008 when they finally, under Congressional pressure, used HOEPA to ban liar’s loans. We also know from the Financial Crisis Inquiry Commission (FCIC) report that the Fed’s staff collected data on enormous number of liar’s loans being made by affiliates of the Nation’s largest banks. The Fed’s supervisors used the data to warn the Fed’s senior leadership years before the crisis about the need to use HOEPA to stop a growing disaster. Alan Greenspan and his successor Ben Bernanke refused to stop the endemically fraudulent loans and Greenspan attacked the staff for daring to criticize the largest banks (which reprised his shameful performance when his supervisors criticized the large banks for aiding and abetting Enron’s accounting control fraud and anti-public (tax) fraud) (FCIC 2011: 20). The next page of the report explains that the OCC examiners raised similar flags about liar’s loans based on their examination findings. The OTS examined three of the most notorious “liar’s” loan lenders (Countrywide, Washington Mutual (WaMu), and IndyMac). Countrywide and WaMu were also infamous for their widespread appraisal fraud. The OTS had copious data on mortgage fraud origination by many of the largest lenders that it had a duty to regulate.

Third, the FBI does not mention the SEC though it was the supervisor and examiner of the Nation’s largest investment banks. Those investment banks were among the largest originators and purchasers of fraudulent liar’s loans. The SEC should have had reams of data and expertise on liar’s loans, appraisal fraud, and many other control frauds that generated vast amounts of mortgage fraud. Like the banking regulatory agencies, the SEC should have been an invaluable source of expertise on mortgage fraud in addition to being among the most important data providers.

Fourth, the banking regulatory agencies and the SEC must not have made any criminal referrals the FBI considered worthy of note. Criminal referrals are the “road map” that the experts in banking fraud schemes (the banking regulators and the SEC) provide to the FBI to make it possible for them to mount an effective investigation. The FBI mortgage fraud report does not indicate that it received any criminal referrals from the federal banking and securities regulators. The OTS, during the vastly smaller and far less fraudulent S&L debacle made over 30,000 criminal referrals. How did OTS go from over 30,000 criminal referrals in a far smaller crisis/fraud scheme to zero criminal referrals in this crisis? That question should have been of paramount importance to the FBI. The 2010 FBI report on mortgage fraud, however, does not mention the death of criminal prosecutions by the regulatory agencies. The FBI report does not explain why criminal referrals from the regulators are essential to the FBI’s success because a bank will rarely make a criminal referral against its CEO. The destruction of the criminal referral process, which denied the FBI its vital expertise about the industry, was critical to the FBI’s inability to recognize widespread accounting control fraud.

Fifth, the FBI does not list the honest appraisers as a source of information on mortgage fraud. That represents an extraordinary failure, and one that was as inexcusable as it was disastrous. I have written a great deal recently about the honest appraisers’ efforts to warn the Nation about the epidemic of appraisal fraud driven by the leaders of the accounting control frauds.

From 2000 to 2007, a coalition of appraisal organizations … delivered to Washington officials a public petition; signed by 11,000 appraisers…. [I]t charged that lenders were pressuring appraisers to place artificially high prices on properties [and] “blacklisting honest appraisers” and instead assigning business only to appraisers who would hit the desired price targets (FCIC 2010:18).

The appraisers began warning the FBI in 2000 – before the Enron-era accounting control fraud crisis blew up. The appraisers’ petition was the perfect information the FBI needed – it demonstrated that the leaders of the lenders and their agents were running control frauds. Only the lender and its agents can cause widespread appraisal fraud. No honest lender would ever inflate an appraisal, but an accounting control fraud would find such a strategy optimal. My prior articles have explained that several years before the FBI wrote its 2010 report on mortgage fraud the appraisers had also provided data demonstrating the endemic nature of appraisal fraud and an investigation by New York Attorney General Cuomo had confirmed the accuracy of the appraisers’ warning about the fraudulent lenders blacklisting honest appraisers.

Sixth, the FBI sought no input from white-collar criminologists – the specialists in this field with the most relevant expertise. One hopes that when the FBI investigates the theft of nuclear materials they consult physicists.

Seventh, the FBI sought no input from the professional association of mortgage brokers founded to try to restore integrity to that profession. My prior columns have quoted at length from the honest loan brokers’ testimony before the Fed warning of the endemically fraudulent nature of liar’s loans and explaining the destructive interaction of that form of fraud and appraisal fraud.

Eighth, the FBI specifically notes that it received information from MARI because of its anti-fraud expertise. The FBI neglects to note, however, that MARI had warned the entire mortgage industry (and the FBI) that the incidence of fraud in liar’s loans was 90 percent. By 2006, roughly 40% of all loans originated that year were liar’s loans and the number of liar’s loans grew by over 500% from 2003-2006. After MARI’s warning to the industry in early 2006 about liar’s loans the industry massively increased the number of liar’s loans it made. The only way for lenders to sell endemically fraudulent liar’s loans was through fraud, so the FBI knew that liar’s loans had to propagate fraud throughout the secondary market and mortgage derivatives. Despite all this, the FBI report on mortgage fraud ignores appraisal and mortgage origination fraud directed by the lenders’ controlling officers.

Ninth, the FBI ignores the OTS’s successful crackdown on liar’s loans in 1990-1991 that was based on the inherently fraudulent nature of liar’s loans. No honest mortgage lender would make wide-scale liar’s loans. The FBI ignored the criminal referrals that OTS had made two decades earlier that explained why liar’s loans optimized accounting control fraud.

Tenth, the FBI’s list of “mortgage fraud perpetrators” gives a free pass to the real frauds and fingers the little people for prosecution. The FBI’s list excludes all the officials who actually led the endemic appraisal and “liar’s” loan frauds. The list only covers the minnows.

The inclusion in the list of private sector entities that provided information to the FBI on mortgage fraud of the Mortgage Bankers Association (MBA) (and Fannie and Freddie) helps explain the FBI and DOJ’s failure to recognize control frauds. In the absence of the regulators’ expertise and the regulators “detailing” skilled examiners to serve as the FBI’s internal experts on complex cases, the FBI turned to the MBA for expertise. It formed a “partnership” with the MBA that continues to this day even though the MBA is the trade association of the “perps” and Fannie and Freddie were accounting control frauds. In the next column I will explain how the MBA steered the FBI to a purported “definition” of mortgage fraud that implicitly defined accounting control fraud out of existence. The MBA’s subtle sabotage of the FBI ensured that the FBI would not successfully “reinvent the wheel” and figure out how we had learned to identify and prosecute the twin accounting control fraud schemes during the S&L debacle.

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40 comments

  1. from Mexico

    What possible conclusion can one draw from Bill Black’s nuts and bolts analysis other than that the criminals have seized control of the state?

    One can call it a “kleptocracy” as Hugh does or a “pathocracy” as Andrew M. Lobaczewski does, depending on what one believes the nature of the etiology to be. But the bottom line is the same: criminals and/or psychopaths are running the United States government, and the rot begins at the very top.

    In Stealing Africa there’s a recounting of the history of Marc Rich, who was indicted for tax evasion, tax fraud, and trading illegally (arms for oil) with Iran during the Iran hostage crisis. It was the largest tax fraud ever allegedly perpetrated against the United States, and prosecutors believed they had him dead to rights. Instead of facing prosecution, however, Rich fled to Switzerland, and the Swiss government refused the US’s extradition request to return Rich to the US. Rich set up a company called Glencore, which at the time of the filming of Stealing Africa was the largest commodities trading company in the world, and was in merger negotiations which would make the company even twice as big as that.

    Bill Clinton pardoned Rich — and get this! — before Rich was even tried and convicted. There are extensive interviews of the lead U.S. Federal Prosecutor in the case, Morris Weinberg, Jr., throughout Stealing Africa. But the one where Weinberg describes his reaction when he received the news that Clinton had pardoned Rich is most poignant. Weinberg struggles mightily to understand how Clinton could have done such a thing. The story begins here at minute 42:13

    http://www.youtube.com/watch?v=WNYemuiAOfU&feature=player_detailpage&t=2533

  2. profoundlogic

    What are you talking about? From 40,000 feet everything looks just fine. Jump on the jet stream and get with the program.

  3. diptherio

    We need a whole lot more whistleblowers. The FBI has obviously been captured by the banksters along with the FED, OCC, OTC, etc. The people within these organizations who, like many outside observers, think this situation is totally f-ed up need to start leaking. Employees of captured regulators and law enforcement agencies need to take a good long look in the mirror, decide who’s side their on, and do the right thing. Protecting the bosses is not the right thing…(same thing for employees of JPM, GS, Chase, etc.)

      1. BD MacIsaac

        Not to be cynical, just aware that the case for “more whisteblowers”, which I agree with BTW (a flood of them would be wonderful if not divine) has already been discussed by Mr. Black and others (see links below) and explained as not likely being plausible (at this point in time; not to say that this can’t come full circle during the next crisis that’s on its way). But in the current environment, like the former commentor Mexico points out; the reality is that “criminals have seized control of the state” so whistleblowers and informants don’t have much security and nobody wants to be scapegoated (with perhaps the exception to Snowden). There’s not much of a platform for them – we all know who to thank for that. Those innocent within the system that choose to break ranks and report the fraud would have to be real mavericks OR so deep in shit like Iksil Voldemort may be that they turn stool pigeon for the sake of immunity. Reference Preet Bharara’s comments from the other night’s press release regarding the latter. Either method of informing works in “normal times” (with the jeopardy being more likely in the latter method than the former), but as everyone here and elsewhere seems to be pointing out on a daily basis in the blogosphere; these are not “normal times” relatively speaking; it’s pretty bad to say the least (follow the Eurozone crisis if you think I’m delusional in making the latter statement).

        Reference the following for the impotency of the “state” to punish financial crime and sing praise for whistleblowers within that industry. Black had already repeated some of its content in today’s post:

        http://neweconomicperspectives.org/2012/10/why-are-there-no-famous-financial-whistleblowers-in-this-crisis.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+neweconomicperspectives%2FyMfv+%28New+Economic+Perspectives%29

        Conspiracy theories aside, and speculating on whether it’s personal incompetency of criminal justice employees (say a lack of understanding of what their job function is really about e.g. Holder, Breuer concerned about TBTF bringing the entire system down as they were threatened would happen so
        they cower to something that’s not in their purview – AND no they’re not going the altruistic extra-mile and being visionary in their scope creep so they can protect us citizens from further harm – reference criminogenic behavior and the race to the bottom theories being more detrimental to system stability in the long-run), group think ideology and/or manipulation of the once established according to Black “definition of mortgage fraud … steered … out of existence”, a complete deregulation political ideology (repeatedly proven non-scientifically based neoliberal philosophy that just happens to have mathematics blended in to it to give it “credibility” – read as unneccessary complexity = easy fraud – the real equation), or all the other reasons too numerous to mention in a blog comment (just read this as lame excuses from DOJ that go beyond idle
        incompetence). The latter I think has generally been accepted by the average citizen (financially literate or illiterate doesn’t seem to matter anymore when the scale is this epidemic as Black points out in comparison to the S&L crisis (e.g. 30K referrals down to Zero; no execs indicted a message that everyone gets loudly and clearly). The only citizens left fighting and continuing to stay informed (like here and elsewhere) have simply had to adopt apathy as an attempt to remedy one’s level of frustrated disbelief in the failure of a system (specifically over the last five years). Apathy is a sane method of maintaining one’s sanity. All those still fighting, please don’t stop; the latter comments about apathy were not to denigrate the unsung heroic efforts of those diligent workers in and outside of gov’t (the insider Neil Barofsky comes to mind; same with Elizabeth Warren if she’s successful in legislating SIFIs / TBTFs out of existence over the long haul in her new career. Also since he’s not booed here extensively, Elliot Spitzer who I hope does get the NYC comptroller even if he’s a bit egomaniacal (yes the kettle was just called black by me; aren’t we all :)) and the educators and feminists hate him; to them I say ‘a junk yard dog still serves the junk yard well even if it’s vicious’ – just pulled that quote out of my backside and am now hated too. Anyhow he’ll be in the right place at the right time. Wall street is his block and he’s already educated on how to navigate it – just unfortunately oh so human in his mortal weaknesses. Two words: Cold Showers. Another Two: Stay focussed. Last Few: Be on your best behavior! At all times! You know exactly what you’re up against if you want to be Moses – The Lawgiver – Do not turn into that which you despise and are trying to bring to justice. That should be enough.)

        To stay on topic, unless there is an insane amount of people coming forward as whistleblowers driven by a personal or social moral impetus or possibly its polar opposite; a disgust of witnessing or possibly participating in perpetual

        frauds themselves (the “I can’t look at myself in the mirror anymore knowing what I know is going on” self-recognition), then the whistleblower path will not be enough to tip the scales to reign in the TBTFs through criminal prosecutions

        this should include the post’s aforementioned minnows just as culpable accomplices within the finance industry. I’m simplifying, but bear with me, because like most of the other progressives here, many of us have been thinking about this moral decay of the world financial instutitutions (not to mention corporate and political, but that’s for another diatribe) for quite some time and a lot of emotion(s) can build up over such a long time period witnessing injustice
        that all one is left with after the rule of law has failed again and again is the diatribe venting method (I don’t discount Occupy and marching Zinn style to City Halls, but the numbers don’t seem to be there just like with trying to stop the Iraq war here in 2003 (exceptions made to Europe not including the UK). Sorry for stating the obvious case and history, but I’m getting to my point below that we, like the semi-idle DOJ, regulators, and law enforcement, may just

        need to wait for the criminals to turn on themselves. Waiting is very, very hard to do and this is clearly wishful thinking but… I’m not saying waiting is an apathetic tactic that will work in every case (reference history here), but time is a variable in this process that works both for (e.g. they’ll over-leverage themselves on junk assets with next to free money yet again and there won’t be bail-outs this next time if the outcry is loud enough) OR critics can argue that it [time] also works against the cause for justice (statutes of limitations run out on the past crimes), but aren’t we already to that point and lacking the judicial and political infrastructure to force prosecution of the sub-prime crises – I know this sounds bad and apologetic towards the alleged criminals, but it may also be very true as others have commented on the status of the current inept systems/staff designed/hired to halt these crises in the first place (not being idealistic in regards to the latter – this is convincingly demonstrated by the fact that not a single top exec like Mozilo was prosecuted criminally and sent to prison). Like the other NC comment made regarding the latter as “too late”; yes for the GFC of ’08, but not for the next GFC. Just go ask Roubini when the next black swan arrives :).

  4. TomDor

    Excellent article again by Mr. Black as always.

    My re-cap of the crap.

    Bribed congress – er..I mean…pay to play…ah…champagne finance.

    Pardoning the unpardonable… crony politics

    Lied into war on a credit card…er I mean…how else to say a war won’t cost us anything – oh..that is if ya don’t count human life as valuable.

    Indoctrination of the American public into rule by fear… chicken little politics played by cowards.

    War on terrorism…shock and awe etc.

    Illegal activities and consorting with the enemy — you know…laundering drug and terrorist monies by our fine financial services institutions – how could they do any wrong…full faith and credit of our government and the US of A… and all that rubbish.

    And then some sarcasm from the 1920′s below….

    He isn’t really a big time crook unless you must let him alone to prevent the loss of public confidence.

  5. nomdeguerre

    Of course the banksters love Holder. Eric Holder is their criminal inside man, the keystone in the edifice of criminal control fraud that has overtaken the U.S.A. We no longer have honest service for an honest tax dollar. Criminal looters hold the real reins of power and Holder serves them. Can we bring a civil RICO suit against the federal government?

  6. MikeW_CA

    Long ago, when I was growing up, the way to “make it” in America was to work hard, create a good product or service, sell it to satisfied customers, and grow wealthy as those customers recommended your company to their friends and family.

    Now, the way to “make it in America” is very different: acquire power, and use that power to take from others.

    1. TomDor

      Getting something for nothing

      The great sore spot in our modern commercial life is found on the speculative side. Under present laws, which foster and encourage speculation, business life is largely a gamble, and to “get something for nothing” is too often considered the keynote to “success”. The great fortunes of today are nearly all speculative fortunes; and the ambitious young man just starting out in life thinks far less of producing or rendering service than he does of “putting it over” on the other fellow. This may seem a broad statement to some: but thirty years of business life in the heart of American commercial activity convinces me that it is absolutely true.
      If, however, the speculative incentive in modern commercial life were eliminated, and no man could become rich or successful unless he gave “value received” and rendered service for service, then indeed a profound change would have been brought in our whole commercial system, and it would be a change which no honest man would regret.- John Moody, Wall Street Publisher, and President of Moody’s Investors’ Service. Dated 1924

    2. F. Beard

      You’ve left “stealing your neighbor’s purchasing power by getting a loan from the bank” out of your formula for success.

      This crisis is not virgin because government-backed banks have always been crooked because they are inherently so.

  7. from Mexico

    Anyway, the FBI is entirely too busy creating “terrorists” out of whole cloth to have time left over to devote to such trivial matters like chasing financial criminals:

    There have been hardly any real terrorist events in the US, which is why the FBI has to find clueless people around whom to organize an FBI orchestrated plot in order to keep the “terrorist threat” alive in the public’s mind. At last count, there have been 150 “sting operations” in which the FBI recruits people, who are out of touch with reality, to engage in a well-paid FBI designed plot. Once the dupes agree, they are arrested as terrorists and the plot revealed, always with the accompanying statement that the public was never in any danger as the FBI was in control.

    When 99 percent of all terrorism is organized by the FBI, why do we need NSA spying on every communication of every American and people in the rest of the world?

    http://www.paulcraigroberts.org/2013/08/13/humanity-is-drowning-in-washingtons-criminality-paul-craig-roberts/

    1. F. Beard

      The Immaculate Conception is a dogma of the Catholic Church maintaining that from the moment when she was conceived in the womb, the Blessed Virgin Mary was kept free of original sin, … from http://en.wikipedia.org/wiki/Immaculate_Conception

      However, according to a central banker*:

      “Banking was conceived in inequity and born in sin …”

      I’d remind Professor Black that “prudent” banking is still legalized theft.

      *Josiah Charles Stamp, 1st Baron Stamp, Bt, GCB, GBE, FBA, (21 June 1880 – 16 April 1941) was a British civil servant, industrialist, economist, statistician, writer, and banker. He was a director of the Bank of England and chairman of the London, Midland and Scottish Railway. from http://en.wikipedia.org/wiki/Josiah_Stamp,_1st_Baron_Stamp

      1. charles sereno

        Thanks, F Beard. Many think that the phrase refers to the moment when the angel made the announcement to Mary. I’m choking up again with image-memories of Fra Angelico’s depiction of the scene. What an artist! What forms and colors! You’re right, of course. Mary had to be free of the curse of Adam to bear the Savior.

        1. F. Beard

          Please don’t put words in my mouth. That’s what the RCC teaches not what I believe. Mary was stained by sin* too; Jesus has been the only sinless human except Adam and Eve until they fell.

          *And Mary said:

          “My soul exalts the Lord,
          And my spirit has rejoiced in God my Savior.
          “For He has had regard for the humble state of His bondslave;
          For behold, from this time on all generations will count me blessed.
          “For the Mighty One has done great things for me;
          And holy is His name.
          “And His mercy is upon generation after generation
          Toward those who fear Him.
          “He has done mighty deeds with His arm;
          He has scattered those who were proud in the thoughts of their heart.
          “He has brought down rulers from their thrones,
          And has exalted those who were humble.
          “He has filled the hungry with good things;
          And sent away the rich empty-handed.
          “He has given help to Israel His servant,
          In remembrance of His mercy,
          As He spoke to our fathers,
          To Abraham and his descendants forever.”
          Luke 1:46-55 [bold added]

          One without sin does not need a Savior. Not that Mary was not a great person as one can clearly see by the above Scripture.

          1. charles sereno

            Sorry. Since the issue was the “immaculate conception,” you gave an accurate description of the doctrine and I said you were “right.” Clumsy of me to leave an impression that you agreed with it. Putting on my exegetic cap (in no way can I claim a hat), I find that passage of Luke, in style and substance, to be a questionable outlier. Show me other references in Luke to “bond servants/slaves,” for example, unrelated to Old Testament texts. PS It inspired great music as well as art.

            1. F. Beard

              I’d say it’s consistent with the fact that generally those who knew the Old Testament well were able to believe in the Messiah when He showed up.

              So take care how you listen; for whoever has, to him more shall be given; and whoever does not have, even what he thinks he has shall be taken away from him.” Luke 8:18

    2. F. Beard

      My, what I thought clever yet appropriate reply, got ate.

      See Lambert, it did go to my head and now my EDITOR-IN-CHIEF has had to slap me down!

    3. from Mexico

      It was too much the way…to talk of this terrible Revolution as if it were the one only harvest ever known under the skies that had not been sown — as if nothing had ever been done, or omitted to be done, that had led to it — as if observers of the wretched millions in France, and of the misused and peverted resources that should have made them prosperous, had not seen it inevitably coming, years before, and had not in plain words recorded what they saw.

      –CHARLES DICKENS, A Tale of Two Cities

      1. charles sereno

        I can’t be sure I ever read “Tale of Two Cities” in one sitting. Nevertheless, when I see a nice excerpt (thanks), I choke up. Dickens is one of my favorite Victorians.

      2. F. Beard

        Yep. That’s a good one.

        Btw, if one has a good heart, he’ll eventually have a fine mind too, I’d bet. But the reverse is not at all certain, I’d also bet.

        Watch over your heart with all diligence,
        for from it flow the springs of life.
        Proverbs 4:23

    4. susan the other

      Indeed: The Immaculate Creation of MERS. It comes from some extra-legal universe that has nothing to do with out land title laws and practices. And because the Mortgage Industry was able to create this Grendel (owned entirely by the TBTF banks) we now say, oh well – MERS is just an “agency.” What total bullshit. MERS is at best a database; but it is probably a massive money laundry. Take your pick. I’m thinkin’ laundry.

  8. nomdeguerre

    Of course the banksters love Holder. Eric Holder is their criminal inside man, the keystone in the edifice of criminal control fraud that has overtaken the U.S.A. We no longer have honest service for an honest tax dollar. Criminal looters hold the real reins of power and Holder is their firewall of protection. Can we bring a civil RICO suit against the federal government?

    1. damian

      you’re wrong –

      Holder is a high level operative for the banksters along with Brewer from Covington & Burling – the real perper’trator’ – is OBAMA

      he is the ultimate head of organized crime – he famously said: bankers are “savvy” businessmen.

  9. F. Beard

    Or is it that attempts to make banking less unstable must make it more crooked (and vice versa?)

    But crookedness itself is unstable! So it’s all been in vain anyway – the Fed, government-deposit insurance, etc.

    Congratulations, for proving once again that God is not mocked?

    How many lives this time unless we repent?

  10. allcoppedout

    All developed countries have massive data on mortgage and FIRE scams generally. It’s very difficult to understand why our authorities haven’t stepped in big time on corruption – unless one steps up to Mexico’s level of “paranoia” – something I regard as very close to the truth. Glencore is very scary and set up through London and Zurich. Some 485 directors were worth $167 million each following the IPO. This is a long way from Marc Rich and Co. AG in 1874 – how did so many rich boys invest with someone we regard as a crook?

    I no longer believe in the financial system at all. Sure I’d ride shotgun for Bill Black – but we are way beyond any fix now.

  11. just me

    Second, the long list of federal entities that provided “information” about “mortgage fraud” did not include the Federal Reserve, the FDIC, the OCC, and OTS – the four banking regulatory agencies that should have been the leading source of information on mortgage fraud.

    Tony Stark in The Avengers: “An intelligence agency that fears intelligence? Historically, not awesome.”

  12. just me

    Bill, re #2, 3, 4 and 10 I think (name that crime, name that criminal), and this:

    In the next column I will explain how the MBA steered the FBI to a purported “definition” of mortgage fraud that implicitly defined accounting control fraud out of existence.

    Question I had the other day in Yves’ story (Quelle Surprise!) on the DOJ’s massive downward revision of the Mortgage Fraud Task Force results: What’s the DOJ’s definition of a distressed homeowner (Distressed Homeowner Initiative said to drive the task force), and did it change, or was it ever anything? Because I was thinking of when Elizabeth Warren was trying to pin down how the results of the “independent foreclosure review” settlements were arrived at (the one-page sheet of results that came out just before the hearing was another virgin birth), and how whenever you tried to touch solid common ground, it would just vanish. The “independent” consultants had no input in the IFR results, which were apparently decided by the banks by magical methods, and I didn’t see the DOJ ever use the words “bank” or “servicer” on their mortgage victim pages. Maybe I never found the right page. (Help?)

    http://www.nakedcapitalism.com/2013/08/quelle-surprise-adminstration-lied-about-mortgage-fraud-results-numbers-4-to-10-times-too-high.html#comment-1324542

    (The DOJ update clause that got me started: “In addition, the announcement included a number of defendants who were charged in mortgage fraud cases in which the victim(s) did not fit the narrow definition of distressed homeowner that the initiative targeted.” What definition?)

    I think this is probably just another way to say what you’re saying here, that the DOJ will ridiculously NOT look at a bank as a perpetrator of mortgage crime. Still, if there ever was a definite, definitive, solid DOJ definition of distressed homeowner crime, and/or if it changed, that might be interesting to look at. Maybe that’s where your next column is going.

    What’s the relationship between the mortgage settlements and the mortgage fraud task force? Maybe that’s the simplest way to come at this? Maybe the settlements absolved all the bank/servicer crime and left only glitter dust for the task force to chase?

    Sorry for the confused question, but I am confused.

  13. johnyang

    Its great to read that fbi is now taking [part in revealing the mortgage frauds. its an attention time for the frauds in the mortgage industry.

  14. Abigail

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