William Black: Why aren’t the honest bankers demanding prosecutions of their dishonest rivals?

By William Black, a former Federal banking regulator and Associate Professor of Law and Economics at the University of Missouri-Kansas City. Cross posted from New Economic Perspectives.

This is the second column in a series responding to Stephen Moore’s central assaults on regulation and the prosecution of the elite white-collar criminals who cause our recurrent, intensifying financial crises. Last week’s column addressed his claim in a recent Wall Street Journal column that all government employees, including the regulatory cops on the beat, are “takers” destroying America.

This column addresses Moore’s even more vehement criticism of efforts to prosecute elite white-collar criminals in an earlier column decrying the Sarbanes-Oxley Act’s criminal provisions: “White-Collar Witch Hunt: Why do Republicans so easily accept Neobolshevism as a cost of doing business?” [American Spectator September 2005] This column illustrates one of the reasons why elite criminals are able to loot “their” banks with impunity – they have a lobby of exceptionally influential shills. Moore, for example, is the Wall Street Journal’s senior economics writer. Somehow, prominent conservatives have become “bleeding hearts” for the most wealthy, powerful, arrogant, and destructive white-collar criminals in the world. Criminology research has demonstrated the importance of “neutralization.” Criminals don’t like to think of themselves as criminals and their actions as criminal. They have to override their societal inhibitions on criminality to commit their crimes. When prominent individuals like Moore call their actions lawful and demonize the regulatory cops on the beat and the prosecutors it becomes more likely that CEOs will successfully neutralize their inhibitions and commit fraud. People like Moore have never studied white-collar crime, have no knowledge of white-collar criminology, do not understand control fraud, and do not understand sophisticated financial fraud mechanisms. They show no awareness of the economics literature on accounting control fraud, particularly George Akerlof & Paul Romer’s famous 1993 article – “Looting: the Economic Underworld of Bankruptcy for Profit.” People like Moore not only spur neutralization, they actively campaign to minimize the destructiveness of elite white-collar crime and to deny the regulators and the prosecutors the resources to prosecute the criminals.

My favorite in this genre was authored by Professor John S. Baker, Jr. and published by Heritage on October 4, 2004.

Baker concludes his article with this passage:

“The origin of the “white-collar crime” concept derives from a socialist, anti-business viewpoint that defines the term by the class of those it stigmatizes. In coining the phrase, Sutherland initiated a political movement within the legal system. This meddling in the law perverts the justice system into a mere tool for achieving narrow political ends. As the movement expands today, those who champion it would be wise to recall its origins. For those origins reflect contemporary misuses made of criminal law–the criminalization of productive social and economic conduct, not because of its wrongful nature but, ultimately, because of fidelity to a long-discredited class-based view of society.”

We “stigmatize” criminals precisely to increase the difficulty potential criminals face in neutralizing restraints against engaging in crime. Stigmatization is an important restraint reducing crime. Indeed, it is likely that stigmatization can be most effective in reducing crime in the context of elite white-collar criminals because such individuals have more valuable reputations that can be harmed by stigma. A violent street criminal may find a reputation for violence useful. Sutherland’s research demonstrated that elite white-collar criminals were often able to violate the law with impunity. The corporation they controlled might pay a fine, but the CEO was typically not sanctioned when the corporation violated the law – even when the violations were repeated and egregious. Class proved, empirically, to be a powerful predictor of criminal prosecutions, convictions, and sentencing. Sutherland correctly sought to stigmatize elite white-collar criminals and to get policy-makers, academics, and the criminal justice system to view their crimes as important. Sutherland’s partial success in doing so is what enrages people like Moore and Baker. By the way, in order to publish his famous book on white-collar crime, Professor Sutherland was forced to delete his tables setting forth the violations of law by many of America’s top corporations – even though it was all public record information. The censorship had the ironic effect of demonstrating the accuracy of Sutherland’s observation that class mattered when it came to how we framed and responded to fraud by elite criminals. What aspect of holding fraudulent CEOs criminally responsible for their crimes is “socialist”, “anti-business”, or “neo-Bolshevism”? Baker claims that “class” has long been discredited as an important variable. Baker is not a social scientist and he is flat out wrong about class. There are literally thousands of empirical studies demonstrating the explanatory power of class in a host of settings. Baker is also flat out wrong empirically in claiming that white-collar prosecutions target “productive social and economic conduct.” White-collar prosecutions of elites are overwhelmingly based on fraud. Fraud is one of the most destructive of all social and economic conduct. Consider six forms of economic injury caused by accounting control fraud.

Eroding Trust

The essence of fraud is convincing the victim to trust the perpetrator – and then betraying that trust. The result is that fraud, particularly by elites, is the most destructive acid for eroding trust. Research in economics, political science, psychology, and sociology concurs on the enormous value that trust provides in each of these settings. We have all attended conferences that provided the participants with bottled water. If we knew that one bottle in a hundred were contaminated how many of us would drink our bottle? This dynamic explains why hundreds of markets collapsed during the events leading to the Great Recession – bankers no longer trusted other bankers’ representations as to asset quality. Accounting control fraud can cause systemic risk by eroding trust.


When bubbles hyper-inflate they can cause catastrophic economic damage and systemic risk. Accounting control fraud can hyper-inflate bubbles. The first two ingredients in the recipe for lenders engaged in accounting control fraud (extreme growth though lending to uncreditworthy borrowers) have the effect of right-shifting the demand curve. Because particular assets are superior devices for accounting fraud and because accounting frauds will tend to cluster in industries in which entry is easier and regulation and supervision are weak, accounting frauds tend to cluster in particular industries and regions. Accounting control frauds drove the Southwest bubble in commercial real estate during the S&L debacle and the U.S. residential real estate bubble in the current crisis. Hyper-inflated bubbles cause catastrophic losses to lenders and (late) owners, trigger severe recessions, and misallocate credit and assets (causing real economic losses).

Misallocation of credit and human talent

Even when accounting control fraud does not lead to a hyper-inflated bubble, it misallocates credit and human and non-human capital. Accounting control fraud substantially inflates individual asset values. Individuals with strong science and mathematics skills – critical shortages in our real economy – are wasted in making models designed to inflate asset values by fraudulently ignoring or minimizing risk. Accounting control fraud commonly produces reverse Pareto optimality – the borrower and the lender on a liar’s loan made in 2006 and 2007 typically suffered losses while the unfaithful agents become wealthy by betraying their principals and customers. (It is important to recall that it was the lenders and their agents who normally prompted by false statements in liar’s loans.) Fraud makes markets profoundly inefficient.

Gresham’s dynamics

“Private market discipline” becomes perverse under accounting control fraud. Capital is allocated in abundance, at progressively lower spreads (despite massively increased risk), to fraudulent firms and professionals. In this form of Gresham’s dynamic, bad ethics drives good ethics out of the marketplace. Note that once, for example, a significant number of appraisers are suborned by the fraudulent lenders to inflate appraised value it is more likely that such appraisers will go on to commit other frauds during their career. If cheaters prosper, then honest businesses are placed at a crippling competitive disadvantage. Effective regulation and prosecution is essential to make it possible for honest firms to compete.

“Echo” fraud epidemics

Fraud begets fraud. Or to put it in criminology terminology – accounting control fraud is criminogenic. Fraudulent lenders created perverse incentives that produced endemic fraud (often by generating Gresham’s dynamics) in other fields. Fraudulent lenders making liar’s loans, for example, created overwhelming financial incentives they knew would lead their loan officers and loan brokers to engage in pervasive fraud. Indeed, fraudulent lenders embraced liar’s loans because they facilitated endemic fraud by eviscerating underwriting.

Accounting control fraud also leads to the spontaneous generation of criminal profit opportunities, causing opportunistic fraud. Liar’s loans, for example, generated a host of fraudulent entrepreneurs offering illicit opportunities to use someone else’s credit score to secure a loan. (Austrian school economists should recognize this dynamic.)

Undesired frauds arising from control fraud

Lenders engaged in accounting control fraud must suborn or render ineffective their underwriting and internal and external controls. They also select, praise, enrich, and promote the most unethical officers. The real “tone at the top” of a control fraud is pro-fraud – often overlaid with a cynical propaganda campaign extolling the Dear Leader’ astonishing virtues. The result is that the firm environment is criminogenic. Some officers may loot the firm through private schemes, e.g., embezzlement at Charles Keating’s Lincoln Savings and self-dealing at Enron.

White-collar crime prosecutions are overwhelmingly taken against frauds. There is nothing economically productive about fraud. When Heritage and the Wall Street Journal feature odes to elite frauds they are fertilizing the seeds of the destruction of capitalism and its replacement by crony capitalism.

Moore’s article has the same tone and themes as Baker’s complaints against prosecuting elite white-collar criminals.

“[T]he anti-capitalist left … [is] using the criminal law for the endgame purpose of striking down the productive class in American that they so envy and despise….”

Moore decries the passage of “Sarbanes-Oxley and other such laws criminalizing economic behavior….” He claims that prosecuting CEOs leading control frauds will harm shareholders – which he plainly sees as prohibiting criminal liability for corporate officers. Moore’s complaints about SOX are confusing because Sarbanes-Oxley does not criminalize honest “economic behavior.” “Economic behavior” is not privileged. It can be honest or dishonest. Only honest economic behavior is potentially productive. Even honest economic behavior may prove unproductive or cause severe negative externalities. Dishonest economic behavior can benefit shareholders. A firm that gains a competitive advantage over its market rivals through fraud will be more profitable and should have a higher share price. That increased profit and share price is bad for the world. It creates a Gresham’s dynamic and misallocates capital. It may also maim and kill if the competitive advantage arises from selling harmful products to consumers or firms.

Moore eventually explains that what disturbs him most about white-collar prosecutions is that the CEO of a publicly traded company can be prosecuted for accounting fraud. SEC rules require that registrants comply with GAAP, so material accounting fraud constitutes securities fraud (a felony). Criminologists have long pointed out that accounting is the “weapon of choice” for financial firms. Moore objects to prosecuting the most destructive property crimes committed by elite white-collar criminals. Accounting control fraud drove the second phase of the S&L debacle. The first phase was interest rate risk and ultimately led to roughly $25 billion in losses. The Enron-era frauds prosecuted by the federal government were accounting control frauds. The current crisis was driven by the accounting control frauds – the largest nonprime lenders, Fannie, and Freddie. The officers that were prosecuted during the S&L debacle and the Enron-era frauds were not members of the “productive class.” No one destroyed more wealth, for purposes of personal greed, than these fraudulent elites. Their crimes and the harm they caused, however, pale in comparison to the accounting control frauds that drove the current crisis. That makes it all the more astonishing that not a single fraudulent senior officer at the major nonprime lenders, Fannie, or Freddie has been convicted. The shills for elite white-collar criminals have swept the field. The administration they constantly deride as socialist has continued the Bush administration’s policy of de facto decriminalization of accounting control fraud. Moore and Baker have, once more, proven Sutherland correct – we treat elite white-collar criminals in a way that bears no relationship to street criminals. We now bail them out after they loot and cause “their” banks to fail and change the accounting rules at their demand to hide their losses. We even invite them repeatedly to the White House to advise us on what policies we should follow.

The anti-regulators got their wish – they took the regulatory cops off the beat. The banking regulatory agencies ceased making criminal referrals, the SEC ceased bringing even their wimpy consent actions against the massive accounting control frauds, and the Justice Department ceased prosecuting the accounting control frauds during the run up to the crisis. The results were multiple echo epidemics of fraud, a hyper-inflated bubble, and the Great Recession. If Baker and Moore think these fraudulent CEOs constitute the “productive class” – then capitalism was killed by the producers. The financial frauds, however, were not productive. They were weapons of mass financial destruction. Their fraudulent CEOs were motivated by the most banal of motivations that every major religion warns against – unlimited greed, ego, and a radical lack of empathy for their victims. The most pathetic figures in the crisis, however, are not the CEOs but their shills. Why aren’t the honest bankers leading the charge to prosecute their fraudulent rivals?

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  1. Expat

    It’s hopeless. The Rich and Powerful believe they are being persecuted for their success. They believe that making money is an end in itself and all ways of doing so are valid and noble. They have suborned authority and regulation which further legitimizes their behaviour.

    Honest bankers are probably, on average, less successful than dishonest bankers. Being [partly] human, they suffer from envy like the rest of us. They believe they, too, should be billionaires and spend sleepless nights agonizing over why they don’t have the courage to cut corners. They try to rationalize by telling themselves they are honest and doing the right thing.

    But on Wall Street and in corporate American honesty is rare and unsuccessful. Doing the right thing means being poor [relatively]. Honest bankers are ridiculed by their brethren and have lesser reputations (which contradicts what your piece says).

    Honest bankers cannot prosecute dishonest bankers because they rely on them. If Citi and GS are TBTF, then the honest banker is as caught up as the rest of us. They can’t sink the ship from under their own feet.

    Honest bankers might not be privy to the dirt since they are outsiders.

    Honest bankers probably don’t lobby or suborn regulators as effectively as most bankers. They don’t have the financial or moral ability to do so.

    1. KnotRP

      Bad money drives out good.
      Bad bankers drive good bankers out of business.
      We let it go on so long, we don’t even know what
      a good banker looks like…

    2. F. Beard

      It’s hopeless. The Rich and Powerful believe they are being persecuted for their success. Expat

      What success? Their wealth was obtained by stealing purchasing power from the poor via the government enforced counterfeiting cartel.

      They believe that making money is an end in itself and all ways of doing so are valid and noble. Expat

      Not true. They believe (falsely) that they earned their money honestly. They are generally ignorant. as many people are, of how fundamentally dishonest the money and banking system is.

      They have suborned authority and regulation which further legitimizes their behaviour. Expat

      How does one regulate a fundamentally dishonest activity – extending credit in a government enforced monopoly money supply for private debts?

    3. jacke

      Not to mention that the few reasonably honest bankers left are led by the nose by the bigger banks’ corrupt officials.
      The big banks and their lawyers know that they can do whatever they please and that no one will ever be able to win in court against them. Attorney-client privilege allows multiple ways to destroy the opponent outside the courtroom, with no way for the innocent to prove their innocence, or, in most cases, even see the inside of a courtroom. Verbal fraud, verbal threats, etc. by the rich lawyers employed by these banks to destroy “at will” bankrupt the bank’s opponent, and no lawyer will take a case on contingency, even knowing that he can win it, if he knows that he will never see any money. What bankrupt individual is going to be able to pay a million dollars for a lawsuit against a corrupt bank, knowing that winning will change nothing except make things worse for the hundreds of others as well.

    1. Eric

      A poor article as regards its dealing with its title-question (which it shockingly ignores), but a superb article as regards its exposing the shills for Republican-Obama policies.

      Will Bill Black please answer the essay’s title-question? I have long pondered it, and am still puzzled to see how strongly small-business people support the criminality of the big-business oligopolists who make things so difficult for them.

      1. lizinsarasota

        Don’t you think small business people don’t complain too loudly because they each – secretly or not so secretly – cherish the dream that someday, some way, they will join the ranks of the “wealthy”?
        Don’t we all, as Americans, believe that tomorrow will be better than today? Don’t we all bring to the table the belief – in the very fiber of our being – that we can “make it” by dint of creative thinking, hard work, and sacrifice?
        This foreclosure scandal has exposed the rot in nearly every place where we “look up” to the very professionals who, because of education/training we feel have a) merited their exalted positions and b) set the standard for probity: bankers, lawyers, judges, accountants, notaries…
        My favorite quote in this article is:
        The essence of fraud is convincing the victim to trust the perpetrator – and then betraying that trust.

        That’s what I’ve been saying all along. I refuse to apologize for trusting my bank. My bank of 17 years. My bank who thought I was a good partner in our mutual investment of three houses. When my bank gave me advice, based on their confidential knowledge of my unique financial relationship with them – I – duh – took their advice! Of course I took their advice!
        When I sued JP Morgan Chase back in August I alleged – among other things – FIVE different kinds of fraud. And, you know something; I’ll be able to prove it. Just wait until a jury gets a load of my story!!

        1. Acadiana

          Your post begs a few questions, Liz.

          (1) These three houses that you bought… did the bank approach you about buying them, or did you first approach your bank about buying them, already having made up your mind that you wanted to do so? I’m betting on the latter as it’s quite rare for a bank to approach a client about an investment opportunity – in the vast majority of the cases it’s the other way around.
          (2) If the houses had gone up in value (instead of going down and, I’m assuming, ruining your finances – correct me if I’m wrong) and you had sold them… would you have paid out a portion of the profits to your “partner,” as you call your bank? I’m thinking not.
          (3) Please share with us what kind of fraud was perpetrated on you by your “partner”. Inquiring minds and all…

          1. francis

            If a person (liz) on the internet alleges JPM defrauded her, chances are they did. What do you figure the odds are, with as little information as is in her post? Want to bet on JPM’s honesty?

            Well, do ya?

          2. Acadiana

            Here’s the part that raises multiple red flags for me:

            “I refuse to apologize for trusting my bank. My bank of 17 years. My bank who thought I was a good partner in our mutual investment of three houses. When my bank gave me advice, based on their confidential knowledge of my unique financial relationship with them – I – duh – took their advice! Of course I took their advice!”

            Translation: I made several dumb real estate investments and I’m mad because my bank (JPM) should’ve known how dumb I am and stopped me. So, now I’m going to dig back through the documentation and try to figure out some way to allege fraud on their part.

            Liz can correct me if I’m wrong. But I’ve seen this movie before.

            There are plenty of legitimate grievances against the banks. But folks who bought multiple houses in investment schemes to make money – which failed miserably – have only themselves to blame. And many of them are simply using the current environment to try to point the blame at anyone other than themselves.

  2. Patriot

    For the same reason that honest police officers don’t spend a lot of time demanding the prosecution of their corrupt fellow officers.

    1. Cynthia

      Or another way of saying what you are saying is that the honest and law-abiding bankers aren’t going after the ones that are not for the same reason that Obama has refused to go after Bush: they too want to get away with being unlawful an dishonest.

      1. Patriot

        I actually wasn’t that cynical. I think it has more to do with group dynamics and the fact that most people don’t want to rock the boat. It’s human nature to generally want to fit in and not upset one’s peers. Those who will disrupt the group dynamic are the exception and not the rule.

  3. Parvaneh Ferhadi

    I’ve said it before but I say it again: It has to do with the personality types of those ‘productive’ elite. In short most of them (probably all) are psychopath as Lobaczewski defined it.

    What Mr. Black calls ‘criminogenic environments’, Lobaczewski calls ponerogenic associations. Despite the different names, both describe the same thing.
    From ponerology.com:
    “In any society in this world, psychopathic individuals and some of the other deviant types create a ponerogenically active network of common collusions, partially estranged from the community of normal people… Their sense of honor bids them to cheat and revile that ‘other’ human world and its values at every opportunity.” (Lobaczewski, 138)

    Living in a world whose morals and customs are meaningless to them and even seen as oppressive, psychopaths dream of a “happy” and “just” world where their depraved worldview is accepted as reality. They seek, by any means necessary, to achieve positions in government where their dreams can be brought to fruition. If injustice does exist in a society, their statements regarding the ‘unfairness’ of their situation can resonate with those who actually do experience such injustice. Thus, revolutionary doctrines can be accepted by both groups for diametrically opposed reasons.

    Ponerogenic groups are those with a statistically high number of pathological individuals, to the point that the group as a whole exercises egotistical and pathological behavior. Deviants function as leaders and ideological spellbinders, and while normal people may act as members, they have typically accumulated various psychological deficiencies. Those not susceptible to such influence are excluded from the group. These groups can either infiltrate existing governments or exert their influence from “behind the scenes.” Bribery, blackmail, murder and similar terror tactics are used to achieve these ends.

    Ponerology, by the way, is the study of evil.

    1. Parvaneh Ferhadi

      I am sorry that you feel offended by this, but it’s not junk science at all, and it’s not anti-semitic either – except in your mind, maybe.
      Instead of throwing such unfounded accusations around, you might want to deal with the facts and discuss them. If it’s junk, as you claim, it shouldn’t be difficult for you to show us how and where Lobaczewski went wrong and in what way he was anti-semitic.

      1. Anon

        You can also cite Snakes in Suits

        Let’s say you’re about to hire somebody for a position in your company. Your corporation wants someone who’s fearless, charismatic, and full of new ideas. Candidate X is charming, smart, and has all the right answers to your questions. Problem solved, right? Maybe not.

        We’d like to think that if we met someone who was completely without conscience — someone who was capable of doing anything at all if it served his or her purposes — we would recognize it. In popular culture, the image of the psychopath is of someone like Hannibal Lecter or the BTK Killer. But in reality, many psychopaths just want money, or power, or fame, or simply a nice car. Where do these psychopaths go? Often, it’s to the corporate world.

        Researchers Paul Babiak and Robert Hare have long studied psychopaths. Hare, the author of Without Conscience, is a world-renowned expert on psychopathy, and Babiak is an industrial-organizational psychologist. Recently the two came together to study how psychopaths operate in corporations, and the results were surprising. They found that it’s exactly the modern, open, more flexible corporate world, in which high risks can equal high profits, that attracts psychopaths. They may enter as rising stars and corporate saviors, but all too soon they’re abusing the trust of colleagues, manipulating supervisors, and leaving the workplace in shambles.

      2. Parvaneh Ferhadi

        And this is anti-semitic or anti-black why? It’s a scientific observation, that would need to be verified or falsified. Can you do either? Than please do so.

        You cannot just deny the validity of an observation just because it doesn’t suit your pre-conceived ideas and call everything outside your own little world junk-science.

        Try using arguments instead of insults.

  4. Random Lurker

    On the plus side (from my point of view), once this kind of “conservatives” convince people that asking rich and powerful people to abide laws is “socialism”, a lot of people will realize that they actually like socialism a lot.

  5. Tom Crowl


    I’m so looking forward to joining a class action suit!!!
    (attorney calls welcome)

    Here I come, John Stumpf!

    (It’s a long story… the short version is they’re idiots who can’t handle the assets they’re supposed to handle even when the owner was trying to be co-operative and they could’ve had rent covering mortgage with a month or two forebearance.)

    But here’s the funny part:

    A few days AFTER they foreclosed (stupidly after a short sale price had been agreed to with Wachovia and in the midst of shifting to Wells)…

    A visitor (nobody I know and not visiting me) BROKE HIS ANKLE IN THE BACK YARD!!!

    And is now SUING WELLS FARGO! Who are claiming that THEY DON”T OWN IT!

    I can’t wait to find out who does!!!

    The TBTF banks, by their very nature are incapable of making wise decisions on a granular basis. This whole process has been an exercise in collective ‘justice’ enforced by a corrupt partnership between the banking sector and government. They are simply trying to cover-up what is really FUBAR and hope we won’t notice their responsibility.

    This hurts ALL homeowners… which is why, btw… ALL mortgages should be reset to true market (in alignment with wages and rents).

    Would that cause a problem in the bond market?
    Duh… yes!

    But I thought in the free market there was supposed to be a price to pay for poor risk assessment?

    I don’t think they’re going to get away with it in the final analysis… nor will any political party that defends it (covertly or otherwise).

    P.S. Dear Mr. Stumpf, I understand you guys are all into financial innovation. Cool! (But I don’t think I can wait anymore for your call… sorry.)

    The Patent

    (Look, I gotta find what fun I can in this difficult situation. I’m standing on the porch with the keg for the party… the guys inside are screaming “Where’s the beer?”… and John, Timmy, Ben and the gang keep kicking me in the knees every time I try to knock on the door.)

    1. monday1929

      Congratulations on Patent. You have my permission to register the domain name: “Bankersbounty.com”

      Small donations would go to a bounty fund offered to anyone providing information leading to the indictment of senior bankers. Whistle blowers, whose career path after doing so answers William Black’s question, could also be provided for.

      1. jacke

        Are you a lawyer willing to take the cases? I have a really good case for you, but the whistle blowers are afraid to speak up, the bank lawyer owns the judge (in bed with?) in the court where foreclosures must be handled, the other lawyers in town are afraid to take the bank lawyer on (s/he has been known to make threatening phone calls to other lawyers and tell them they will never work in that city again if they take the case). Once the bank heads decide your property is one they want in their private portfolio, you are dead in the water, as they can call a commercial loan “at will” without cause and in bad faith, no matter what the rest of the multiple-volume loan documents say. A federal judge in Chicago has upheld the banks’ rights to exactly that! How many businesses were destroyed and jobs lost this time with the feds covering the bank losses while the bank heads looted “at will” from borrowers and stockholders alike?

        1. monday1929

          No, not a lawyer. Others on this site or ones dedicated to fraudclosure might be of help to you. I don’t recall seeing much on abuses of CRE, that could be a whole new can of worms. Good luck to you.

          1. jacke

            Not a chance in hell to win without a regulation that requires that banks must PROVE cause before foreclosing. Of course, Bernanke insists that it is not the role of federal regulators to investigate this kind of fraud. Geithner told the banks that TARP was for NEW loans, not EXISTING, giving them the green light to steal at will for their personal portfolios, while shutting down business after business, causing job losses all over, then the home mortgage defaults.

  6. Bravo

    “We now bail them out after they loot and cause “their” banks to fail and change the accounting rules at their demand to hide their losses.”

    While there is no doubt that the banking cartel’s capture of the regulatory bodies has long been central to their survival strategy, sufficient spotlight has not been pointed in the direction of the FASB rule making body that seems to change accounting rules to the convenience of the banking cartel, whenever the going gets tough. Regulators are not the only parties subject to capture.

  7. ComradeAnon

    Banker is a mind set. Like being a Fox “journalist”. Or a bagger. Accountability vanished long ago from their genes.

  8. bmeisen

    Apparently not enough voters demand accountability, maybe because it takes time and effort to understand what is happening and not enough of us have time and effort available.

    As Simon Johnson stated in the video that was made available here yesterday, the damage caused by the banksters, the cost of which we have been forced to bear, was substantial: loss of millions of jobs, almost a doubling of public debt owed to the private sector, among other externalities.

    My question is: Doesn’t a doubling of public debt have concrete downsides? I mean at one time debt was considered harmless, especially for states. Who can expect that it will ever be paid back? Just pile on more, seemed to be, and seems to still be, the consensus. Big government is the problem, not big government debt, as far as the GOP is concerned. There might even be another high-tech revolution anyway and we’ll be swimming in money again.

    But US gov’t debt is attractive in part because it is served, right? Interest payments are made and every cent spent on interest isn’t being spent elsewhere, isn’t being refunded to angry heavily burdened taxpayers.

  9. F. Beard

    “Why aren’t the honest bankers demanding prosecutions of their dishonest rivals?” William Black

    There are no honest fractional reserve bankers, Mr. Black. Due to the government enforced monopoly money supply for private debts, FR bankers are essentially allowed to counterfeit via credit creation. The population cannot escape the price inflation the FR bankers cause and are thus looted by it.

  10. melior

    I’ll say it again, the only viable solution I see is a scheme built around greed, to motivate the rest of the financial industry to police their own. No one else is devious enough to catch them at it, motivated to care as much to persist til successful, and no other tool is apparent that has proven powerful enough to work against greed except itself.

    Huge (massive) insider bounties for snitching are one idea, on the order of tens of percent what they would make by quietly going along, remunerative enough to weigh against fears of retaliation in their greedy reptilian lobes. Other ideas built on the same premise may work even better. I am skeptical that promises of anonymity are in the end viable, it may be necessary to develop a concomitant scheme to provide them with social status in some fashion, but this is not sufficient for most without sating their greed first.

  11. Frankenstein Government

    I have talked about this many times.

    The head of the enforcement arm of government is the President. This President was bought and paid for by a scared shitless crowd of crooked bankers.

    This President made good on his promise and payoff to the bankers who financed his campaign run when he entered office and announced we would be “looking forward” rather than backward. With a wink of the eye, the contract was fulfilled.


  12. theremin

    Someone else here said “fantasy” and I have to agree. This crappy sermonizing does nothing but get the left excited and eager to shout “Yeah!” “Yeah!” “What he said..!” “And then I’m gonna…!” “And then we’ll…!” blah blah blah. But truth be told if there was anyone perpetrating fraud it was, is…wait for it…. ALL OF US! Or a lot of folks anyway. You talk of “bankers.” Well, what kind of bankers? Merchant bankers? Institutional bankers? Mortgage bankers? Brokers? Dealers? Traders? Salesman? Who the hell are you talking about? Are the guys who created complicated structured products outlaws? What about people who lied about their income to get a loan? The boom years was mob mentality; everyone turned a blind eye. Lots of folks profited and perhaps many on this blog did as well. Or they bought house fairly easily or car or something. But we’re all involved. If you’re smoking Central American dope in Maine, you’re inolved in the crime no matter how removed. If you’re sitting at a Mac sipping a latte in Starbucks, you’re involved in the fraud. Get over prosecuting. If we start stretching the net, then everyone is involved. Write something useful.

    1. F. Beard

      But we’re all involved. theremin

      Nope. Not true. The bankers are guilty, every last one of them. They are essentially a government enforced counterfeiting cartel.

      What were people supposed to do? Park their savings and earn negative real interest rates on them? Be priced out of the market by those who did borrow from the counterfeiting cartel?

      The people had no real choice so they are innocent. This mess is purely the fault of the bankers and the system they set up.

      Away with your “everyone is guilty therefore no one is.”

      1. readerOfTeaLeaves

        You left out the ratings agencies and insurers like AIG. The banks created the conditions for the accounting fraud, but without the other two – plus craven, ignorant legislators – a scam on this scale could not have occurred.

        1. F. Beard

          The banks created the conditions for the accounting fraud,… readerOfTeaLeaves

          All fractional reserve bank accounting is fraud since the FR banks loan money they don’t have for interest that doesn’t exist. The result is an economy that is a fraud.

    2. scraping_by

      If you’re demanding perfect people to prosecute criminals, then of course, the criminals get off scot free.

      The mass of people don’t commit control fraud. A borrower has no chance to cook the bank’s books, nor to . The bad actors were and are the ones with the position and authority to make criminal transactions. We’re all involved as criminals or victims, not too many bystanders.

      I notice there’s also the confusion of liberal and conservative by bringing in lifestyles. This was a deliberate confusion promoted by the right since the 1970’s and kept close to hand ever since. There’s no connection between acknowledging the virtues of sustainability, equality, social security and honest dealings to all those things, good and bad, grouped under the heading of “personal choice.” The last political speech I heard where “keep government our of people’s bedrooms!” was the tagline was by Ron Paul. Not your average wimpy academic liberal.

      As a general thing, a defense speech in a criminal trial will often minimize the crime by trying to relate it to the juror’s inevitable shortcomings. “Criminology research has demonstrated the importance of “neutralization.”” If they keep to themselves and their lackeys, the banksters may be able to keep that up. But the world’s a lot bigger and a lot less friendly.

    3. monday1929

      The meme of “everyone is guilty” was used right at the outset. It’s goal was to instill enough fear in the population, (some of whom may have exaggerated an income) to avoid a call for mass prosecutions of bankers. We all know which bankers we mean, and so do you, Theremin.

  13. Eleanor

    William Black is a pleasure to read, maybe because he knows criminology and thus can understand and explain Wall Street.

    1. Hacksaw

      If there are honest people in the financial services industry they are staying well hidden. When the entire basis for an industry is a Ponzi scheme and all profit of said industry is based on defrauding people out of their money then it just makes sense that it would be difficult to find honest people in such an industry.

      1. Acadiana

        So, “all profit of said industry is based on defrauding people out of their money”? ALL of it. 100% of the financial services industry… now, that’s something. I had no idea how bad it was… but since you wrote it, it must be true.

      2. monday1929

        We should focus some sunlight on their desperate attempt to prevent Brokers from having to be fiduciaries.

  14. Eleanor

    The above is unfair. There must be honest people on Wall Street, but they haven’t been very visible lately.

    1. lizinsarasota

      Yeah, like there are honest lawyers. Where were the other lawyers when the foreclosure mills were filing robosigned/forged documents by the boatload?
      Where the hell were the JUDGES???

      1. Anonymous II

        It’s my understanding that a criminal case starts with
        the filing of charges. Only a few lawyers (people
        admitted to the bar in some jurisdiction or other)
        can file charges. Examples would be: District Attorneys
        (also known as US Attorney for the District of […] ),
        and State Attorneys, I think.

      2. readerOfTeaLeaves

        Ah, the judges. You should search NC for some of Black’s earlier posts here, including one that explains how private interests ‘invested’ in academic posts and curricula – including curricula and textbooks used in law schools, which are training grounds for judges.

        In the earlier posts, Prof Black laid out the timeline and process by which future judges are taught that markets are always self-correcting and economic decisions are based on ‘perfect information’, which means that legalish-wise there is no possibility of fraud.

        You may think that I am making this up because it is so unbelievable and outrageous. If that’s the case, I would encourage you to read Econned, and also Prof Black’s other posts at NC ;-)

        Where were the judges…?
        They were intellectually captured by market fundamentalist ideology, which claimed that fraud could never occur.

        Yes, it is all quite mind-boggling.

  15. jaymaster

    And yet another disservice by trying to spin this politically as a GOP-only issue, and ignoring the enablers with a “D” by their name, like Frank, Dodd, and yes, Obama.

  16. Linus Huber

    The RULE OF LAW or the spirit thereof has been violated seriously over the past 3 years. The Western society has been built on the Rule of Law and will not prosper in the absence of this most important basic principle.

    The above essay explains the result once this aspect has been lost.

  17. F. Beard

    It’s ironic and frightening, that William K. Black, a criminologist, does not recognize that fractional reserve banking itself is a crime.

    “The issue which has swept down the centuries and which will have to be fought sooner or later is the people versus the banks.” Lord Acton


    It is not, and I repeat, NOT hopeless….

    “The invisible hand giveth and the invisible hand taketh away…”

    When all is said and done, that, which we use to measure all things real, the dollar, will lose it’s entire value, bankrupting our great nation and leaving us only with our greatest assets, a gift from our forefathers, unique to our Nation, The Constitution of The Untied States of America and The Bill of Rights.

    Set forth, the implementation of these documents neither demands, nor requires the approval of a democratic plebiscite, The President of The United States (The Commander and Chief of The Armed Forces), Congress or the Supreme Court. The only requirement, is men and women of good will, You…!

    There is hope and You’re it….

    Best regards,


  19. Matt

    Control fraud with the bad actors driving out the good actors has overtaken many if not all corporations. For it is not only in the public arena that corporate fraud can grow, the fertilization and early growth come from internal corporate fraud as cliques of bad actors conflict for dominance. Control of internal transfer pricing is one weapon of choice.

  20. Wyndtunnel

    Try being forthright and honest in a competitive corporate environment and see how long you last. It starts at the very bottom and works it’s way up. I am an atheist. But it’s never been clearer to me how and why religion became the dominating binding force in western civilization. Of course the Big Three are just as burdened by network effects that generally reward the already powerful and those closest to them. It seems the LAW has run it’s course as an alternative to GOD as omnipotent nanny. There was a fascinating peace on NPR or CBC recently (I don’t remember which but it was public radio in any case) recounting how researchers set up situations where children pretty much had to cheat to win the reward in question. The test was administered with a) an adult supervisor b) no supervisor and c)a “ghost” supervisor as the kids involved were young enough to believe such a thing. Of course no one cheated when the adult was present. Cheating was endemic in the presence of no supervisor and cheating was almost no present under the watchful eye of the “ghost” supervisor.

    So we can see that at it’s most cynical Religion is used to keep the poor and downtrodden from cheating while those in the know use the funds from absolution to build gilded temples to God. And of course the rich and powerful in their day could always buy the clergy as well. So nothing has changed. We are faced with yet another criminegenic power structure that will gladly see the people it purportedly serves rot in hell while it basks in the glory of Mamon.

  21. Wyndtunnel

    Of course by Big Three I mean religions not Detroit car companies. A point I meant to reinforce is what Black says: That in the absence of any credible deterrent it is human nature to give in to moral hazard and go with the flow. In today’s corporate environment, the consequences of sticking to any sense of ethical behavior can quickly result in getting your ass fired and thrown into the pool of the long term unemployed. Who is going to do the right thing under such circumstances. Very few. That’s who.

    1. Love makin' tosh

      I wonder if the non believer in experiment (c) was the first to cheat in experiment (b).
      Could it be that the ‘God’ effect gave strength to the more easily led children lest they be tempted to cheat by either the reward or the strength of character of the most dishonest amongst them?

  22. Hugh

    It is good to see the focus returned to crime and the criminality of the financial world, but this is still only a partial analysis. Bill Black writes,

    Somehow, prominent conservatives have become “bleeding hearts” for the most wealthy, powerful, arrogant, and destructive white-collar criminals in the world”

    There’s no “somehow” about it. It’s called kleptocracy. For the umpteenth time, kleptocracy is a system. The actual looters need a host of helpers, enablers, justifiers, and legitimizers not only to loot but to keep looting. They need media to distract and misinform. They need academia and think tanks to come up with bogus “economic” theories. They need government and politicians to cover for them, cheer them on, and bail them out.

    There is no liberal or conservative in any of this. Democrats and Republicans are both equally culpable, and equally necessary to the kleptocratic enterprise. Nor is kleptocracy peculiarly American. It is the dominant politico-economic form on the planet.

    I applaud Bill Black’s emphasis on crime but to really understand how that crime is being perpetrated and perpetuated, he needs to extend his analysis.

  23. Anonymous Comment

    Honest bankers are afraid of the ‘hell-fire’ that would rain down on them if they break ranks. There is a ‘black list’ and it’s not that hard to get put on it. Even honest people need to make a living and don’t want the elites bearing their animosity down on them.

    1. Further Comment

      Another reason came to me. It’s actually a two-parter, each from a different angle.

      When so-called ‘sophisticated high-networth’ clients begin an asset-placement arrangement they are required to sign away their rights to take the bank to court. They agree to arbitration [ done by bank members].

      The other aspect is that bankers have a so-called ‘fiduciary’ responsibility that prohibits them doing anything that would breach the contract of their clients. If they take the wrong approach, they could negate the whole contract. Hence, a catch 22.

      1. Long-time Pondered Comment

        Based on what I wrote above… which is based on uncommon experience… if I were to put on my tin-foil hat and dissect the dubious strategy… I would surmise that the ‘strategy’ is to put clean-clear, high-value accounts into arbitration lock-down, thereby keeping them out of action and on their own books… by creating a tiny error – oops, I did it again – like a transposed number or a simple misspelling – something that would have/should have/could have been caught and corrected earlier – by regular odds occurs, and puts the whole thing[s] on the back burner – where perhaps the principals pass away without families being the wiser, without anything having been said to anyone, and suddenly the account is gone – for good. Como guantanamo for dinero. No se’ como se dice.

        1. Short-time Pondered Comment

          … But that’s only if, ya know, I was putting on my tin-foil hat. But *everybody* ‘credible’ knows that only losers wear tin-foil hats, dude. So I wouldn’t even want to go there.

          Just conjecture, because it’s common knowledge that if everyone is doing it, it’s ok. Right? And clearly not everyone wears tin-foil hats. Thank God. Amen.

  24. F. Beard

    Even when accounting control fraud does not lead to a hyper-inflated bubble, it misallocates credit … William K Black

    And where does the purchasing power for that “credit” come from? ans: It is stolen from every money holder, including and especially the poor, who are not “credit-worthy” themselves.

    So Mr. Black, the entire money and banking system is based on theft. And you, a criminologist, ignore or justify that?

    There is a way to finance investment that does not require so called “credit” – common stock. Rather than reap wealth via money creation and usury, common stock shares it instead.

  25. Teri Buhl

    Today I reported at DealFlow Media’s The Distressed Debt Report that Tom Marano and his ex Bear mortgage traders are finally under criminal investigation for cheating their own clients out of billions in RMBS deals. The D.A. wants to use the Martin Act. Additionally N.Y. Assemblyman Morelle is leading the charge to motivate the NY AG to investigate them for insurance fraud. Now we wait to see if NY regulators have the guts to charge these ex Bear executives who are currently working at Goldman, BofA, and ResCap.

  26. Jason

    It amazes me how much crap goes on. I am dealing with it from the consumer side with Bank of America. I have gotten so fed up with the process, I started a blog and am using a domain name of the “contact” person I have at Bank of America who is supposed to be helping get me a modification. At http://www.RhodaSimmons.com you can read about my journey through the BS that is Bank of America.

  27. Michael Warhurst

    Morality is comprised of human and social values, none of these values nor the benefits of them can be measured in terms of dollars. Although the supposed costs are constantly being emphasised by the corporate media.
    Morality has three positions. Moral, which means that one knows what it is and does it; immoral, which means one knows what it is and doesn’t do it; and amoral, which means that one never considers morality in the first place!
    There can be no better operating example of amoral than one for whom dollars are the final, deciding or only value considered before decision or action.
    Corporations, wealthy elites, their sycophants and promoters are all amoral and are intellectually genetically unable to make moral decisions or do moral actions unless it profits them financially.
    There are three forms of governmental organization. Socialism, capitalism and fascism which can be categorised in terms of benefit and risk as follows.
    Socialism is when the government takes the risk and gets the reward; capitalism is when the individual takes the risk and gets the reward; and fascism which is when the government takes the risk and the individual gets the reward.
    Corporations, Wall Street brokers and wealthy elites are all amoral and endlessly pine for fascism – where they get the rewards and the majority taxpaying general public takes the risk through government.
    Corporations can only evaluate fraud by the costs and rewards. The costs of financial amorality are minimal and their rewards are astronomical.
    This equation guarantees fraudulent behaviour by corporations and wealthy elites.
    Republic was invented by Plato because his mentor/teacher Socrates was forced to suicide by swallowing hemlock because he refused to recant the public statement that ” not all government positions should be elected because some require special skills which cannot reliably be acquired by general election.”
    Plato did an historic freak-out and created a form of government (republic) which is the diametric opposite of democracy.
    A republic is governed by (in our case wealthy) elites, while a democracy is governed by the majority of average voters.
    A government cannot be controlled by both wealthy elites and the majority of average voters at the same time. It’s either one or the other. A government is either a republic or a democracy but it cannot be both at the same time!
    If government is stalemated, who is benefited? The wealthy or the poor?
    If government is stalemated the wealthy and corporations, their business fronts, win!
    Wealthy elites and corporations win if government is fascist or if government is stalemated.
    This is always preceded and accompanied by an organized attack on morality and maximum dimunization of the response to amoral financial activity.

  28. craazyman

    The answer is: “soul loss”

    It’s like “shrinkage” when a man goes swimming in the cold ocean. But it happens to your Inner Kingdom. It shrinks into a little dot the size of a penny. And as it shrinks, the compensating instinct is to acquire metaphorical soul (money). This really is true if you think about it.

    1. Pondered Comment

      Indeed ’tis true. I think of it atrophy. In my perspective the soul is not lost – as in the souls is till there. It’s just shriveled. Your metaphor of cold-water shrinkage is perfect. The part’s are still there, there just smaller because they are hiding from what ‘threatens’ them.

      Those with soul atrophy are afraid that reality might be based on more than money, and they may have wasted their precious lives [and those of others] on something that is not real. The soul shrinks to avoid the message that it’s time for a paradigm shift. Destruction of the previous concept of self would result. Most people are not that brave [yet].

      1. Editing Comment

        Please forgive type-os. [I’m full of them. I think you can get the gist though.]

  29. Daniel

    hello ,
    My name is daniel and I own nigerian forum
    I’m an ardent reader of your posts and not just leaving without a word,
    I love the phrase where you wrote ” The essence of fraud is convincing the victim to trust the perpetrator – and then betraying that trust ”
    Keep it up friend.

  30. Jillayne Schlicke

    Hi Bill,

    The reason why honest bankers aren’t leading the charge to prosecute is because….well because they probably sold loans to fannie and freddie and they don’t want to come off as looking all high and mighty lest someone starts auditing their bank and then they’ll look like a hypocrite.

    They’re doing what we humans always do in times of war: we look after ourselves and the needs of our immediate family first.

    1. CYA Comment

      Jillayne, That is exactly right. Plus the bankers have a so-called ‘fiduciary’ responsibility, which requires them to act in a very single-minded way. Most money now, no exceptions… even if the path of most money now heads us towards a cliff.

  31. Jacqulyn Mack

    Turn “net loss carryforward” on its head and you have “Gresham’s Dynamics”

    Perpetuation of a myth does not make it any more real to those who dont believe the tale….just ask any person who holds their religious faith so close it blocks the remainder of “all” that individual may otherwise perceive without the particular blinder’s of that belief.

    As Orwell succintly stated in “The Road to Wiegan’s Pier”:

    “Question a person of this type, and you will often get the semi-frivolous answer: ‘I don’t object to Socialism, but I do object to Socialists.’ Logically it is a poor argument, but it carries weight with many people. As with the Christian religion, the worst advertisement for
    Socialism is its adherents.”

    I just wonder how long it will take for the current world, as perceived by its apparent “ruling class”, to wake up sliding into the “future” as depicted in the movie “Idiocracy”?

    my 2 cents

  32. F. Beard

    “This column illustrates one of the reasons why elite criminals are able to loot “their” banks with impunity… William K Black

    You don’t get it, Bill. The fractional reserve banks themselves are looters – looters of purchasing power from all money holders, including and especially the poor for the sake of the banks and those deemed “credit-worthy” which the poor are not by definition.

    And now the banks themselves are looted and you complain?

  33. steelhead23

    Dear Professor Black, I have two answers to your question “Why aren’t honest bankers demanding prosecutions of their dishonest rivals.” First, thanks for the lesson on criminology.

    When I try to answer questions regarding motivations, I rely on empathy and visualization. Thus, for your question, I imagine I am the CEO of a modest-sized regional bank. Let’s juice it up a bit and say my bank was burned by one of the big boys’ scams. But, I am a banker. I try to obey the law and control my risks, but I have at times done things I would prefer not to have to explain. I know some real dirt on scumbag TBTF bank. Should I, or shouldn’t I blab to the authorities. First of all – my career has been predicated on an us and them dichotomy. Regulations and regulators are burdensome. I don’t like them. Why should I go to them and scream about my competitors? They aren’t my friends – the banksters are.

    I also conjure up a playground analogy. Some 6th grader took your lunch money: Do you tell a teacher – or gather your friends together, seek him out and beat the tar out of him? I know what I’d do.

    The relational stuff gets even more complicated due to wives et al. Also, Mr. Ethical Banker knows that some folks high up in OCC, FDIC, and the Fed have worked for the banksters. You may wonder – if I go to them to spill my guts, how sure am I they won’t grab my books and scour them to nail me in retribution? Better all the way around to pop some popcorn and watch the show.

    I suspect the real screamers will be disgruntled former employees – the best are those who feel shat upon – say your boss, who makes 5 times what you do, steals your girlfriend. The motivations for such a dude are out of sight – but his veracity as a witness is likely to suck.

    But, in requiem, the question is a bit silly – the real losers in this deal are the U.S. taxpayers and workers, all represented by the U.S. Government. Further, the Democratic Party got a real drubbing in 2010, in part due to bankster bailouts they were coerced into supporting. Why the hell isn’t the Democratic Party pounding on Obama’s door and Holder’s door demanding prosecutions. Why indeed. I haven’t a clue.

    1. jacke

      Behind every ethical banker is a lawyer telling him to shut up. If you don’t like the games your bank is playing, you move on, and if you are really ethical, you tell the client you are working with to “watch out. I’m leaving because I have differences with the bank, but I can’t say anything more.”

  34. slothrop

    The “surprise” at NC of malfeasance in banking sector is getting a bit tiresome.
    Heading over to ZH.

  35. David

    Probably nobody is 100% clean on this. Maybe some of the clean banks have home equity loans that they shouldn’t have made and which they have been hiding some of the losses on. And, as Professor Black knows, the big banks have a great deal of protection from the government. They aren’t likely the ones to be impacted by investigations.

  36. jerkyboy

    Everybody is crooked, from the guy collecting u/e while working on the side to the cops to guys at wall street. Whoopdfuckin doo. What a shock.

  37. Howard T. Lewis III

    Thank-you Mr. Black. ou should be the next head of the SEC, treasury, etc, rolled into the new U.S. National banking system. Maybe a Ron Paul presidency. I would make a loyal body guard and promise not to talk too much.
    Oh, the reason other bankers aren’t demanding prosecutions is either because they are afraid of pig-repercussions and if you look at how judges are picked these days, it is obvious that the fix is in. Look at April Gallop, the pentagon employee and how she is being dogged. This is not rocket science. This is negotiating through the pork section of a stockyard. Gotta be careful.

  38. Howard T. Lewis III

    Thank-you Mr. Black. I have been a fan for some time. You should be the next head of the SEC, treasury, etc, rolled into the new U.S. National banking system. Maybe a Ron Paul presidency. I would make a loyal body guard and promise not to talk too much.
    Oh, the reason other bankers aren’t demhttp://www.nakedcapitalism.com/2011/04/william-black-why-arent-the-honest-bankers-demanding-prosecutions-of-their-dishonest-rivals.htmlanding prosecutions is either because they are afraid of pig-repercussions and if you look at how judges are picked these days, it is obvious that the fix is in. Look at April Gallop, the pentagon employee and how she is being dogged. This is not rocket science. This is negotiating through the pork section of a stockyard. Gotta be careful. Or maybe they find release in knowing they can loot the markets or banks whenever.

  39. pjwrites

    The answer to the question lies in several statements in the article and in the comment section.

    I have a friend who is an accountant. From the beginning of this fiasco he said I only had to ask myself one question: why the accountants and their complicity were not even mentioned in the newscasts, with everyone from hedge fund managers to homeowners being blamed. No mention at all, until now. I’m sure the reason lies somewhere in an Elliot Ness movie, where the accountants were the key to disrupting that particular criminal organization. The accountants will be protected at any cost.

    “why elite criminals are able to loot “their” banks with impunity”
    When I discovered that the majority managing member of our LLC was breaching his fiduciary duty and committing frauds with impunity and brought this to the attention of the other members (who, in a complicated way that didn’t come to light until later, benefited from his frauds) their response to the facts? “It’s his company, he’s the majority owner, and he can do anything he wants.” Including break laws.

    “When Heritage and the Wall Street Journal feature odes to elite frauds they are fertilizing the seeds of the destruction of capitalism and its replacement by crony capitalism.”
    It makes perfect sense to me, because you see, that is the end goal. The deciders will decide, and you must accept what they decide because “it’s their company and they can do whatever they want.”

    “the Bush administration’s policy of de facto decriminalization of accounting control fraud.”
    It’s how the criminal Bush family gained political power positions and became wealthy. It worked for them and it works for “their base” – ergo, it’s “policy” – but only for them. They decide.

    “Deviants function as leaders and ideological spellbinders, and while normal people may act as members, they have typically accumulated various psychological deficiencies. Those not susceptible to such influence are excluded from the group.”

    Exclusion is immediate, of course. This is how you go from being “a valuable and key member of the team” to “a nutjob who didn’t contribute anything to the business”.

    “the consequences of sticking to any sense of ethical behavior can quickly result in getting your ass fired and thrown into the pool of the long term unemployed.”

    My own fate. When I couldn’t afford the $200,000 required to prove the fraud in court, I had to accept their falsely underrated value of my shares in the company and am now without work.

    Meanwhile, they continue to get wealthier.

    Now you have the answer to your question.

  40. william k black

    That black bank went crazy when a p giannini . Turn the asset over to that bank in 1962 charles m – citi group – one united bank . And its sister company citizEn trust bank .co . They acting like pigs , and its idiots , that who in control of the boats . The rocking chair . I say , doom bell . Get out . Claire giannini and l m giannini . Told their dad not to run bank of america to the black way . They was right look at the mess . And the owner is in the mess and don’t even have the mess .

  41. william k black

    Ok their saying its a overheard at alliance bancorp “oak brook . And a admin arrest in atlanta fulton ga , under gloria jean mayes , arrested for court fraud , under all these bank in 2002 and 2004 . Why are the theves still their and the real owner not . ? How we a get this ???? This one a hard one to find out . James allen and williams , michael allen and williams – owner of that black bank – one united bank co . And the big guy ap turn all his assets over to them . Well james for the start . James hillman and stillman . James hoff&hellman .

  42. Frank N. Sense

    Finally an effective way to do away with private property in the United States…make ownership incomprehensible!

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