Crimes of the Big Banks

Crimes of the Big Banks

Preface: Not all banks are criminal enterprises. The wrongdoing of a particular bank cannot be attributed to other banks without proof. But – as documented below – many of the biggest banks have engaged in unimaginably bad behavior.

You Won’t Believe What They’ve Done …

Here are just some of the improprieties by big banks:

• Funding the Nazis

• Laundering money for terrorists

• Financing illegal arms deals, and funding the manufacture of cluster bombs (and see this and this) and other arms which are banned in most of the world

• Launching a coup against the President of the United States

• Handling money for rogue military operations

• Laundering money for drug cartels. (indeed, drug dealers kept the banking system afloat during the depths of the 2008 financial crisis)

• Engaging in mafia-style big-rigging fraud against local governments.

• Shaving money off of virtually every pension transaction they handled over the course of decades, stealing collectively billions of dollars from pensions worldwide.

• Artificially suppressing gold prices

• Charging “storage fees” to store gold bullion … without even buying or storing any gold . And raiding allocated gold accounts

• Committing massive and pervasive fraud both when they initiated mortgage loans and when they foreclosed on them.

• Pledging the same mortgage multiple times to different buyers.This would be like selling your car, and collecting money from 10 different buyers for the same car

• Cheating homeowners by gaming laws meant to protect people from unfair foreclosure

• Committing massive fraud in an $800 trillion dollar market which effects everything from mortgages, student loans, small business loans and city financing

• Manipulating the hundred trillion dollar derivatives market

• Engaging in insider trading of the most important financial information

• Pushing investments which they knew were terrible, and then betting against the same investments to make money for themselves.

• Engaging in unlawful “frontrunning” to manipulate markets.

• Engaging in unlawful “Wash Trades” to manipulate asset prices.

• Otherwise manipulating markets. And see this

• Participating in various Ponzi schemes.

• Charging veterans unlawful mortgage fees

• Helping the richest to illegally hide assets

• Cooking their books

• Bribing and bullying ratings agencies to inflate ratings on their risky investments

The executives of the big banks invariably pretend that the hanky-panky was only committed by a couple of low-level rogue employees. But studies show that most of the fraud is committed by management.

Indeed, one of the world’s top fraud experts – professor of law and economics, and former senior S&L regulator Bill Black – says that most financial fraud is “control fraud”, where the people who own the banks are the ones who implement systemic fraud.

But at least the big banks do good things for society, like loaning money to Main Street, right?

Actually:

• The big banks no longer do very much traditional banking. Most of their business is from financial speculation. For example, less than 10% of Bank of America’s assets come from traditional banking deposits. Instead, they are mainly engaged in financial speculation and derivatives.

• The big banks have slashed lending since they were bailed out by taxpayers … while smaller banks have increased lending.

• A huge portion of the banks’ profits comes from taxpayer bailouts. For example, 77% of JP Morgan’s net income comes from taxpayer subsidies

• The big banks are looting, killing the economy … and waging war on the people of the world

• And our democracy and republican form of government as well

We can almost understand why Thomas Jefferson warned:

And I sincerely believe, with you, that banking establishments are more dangerous than standing armies ….

- Umesh Shanmugam