Rampant financial crime in City of London eroding public trust

Wow! The corrupt banking stories are starting to focus on the City of London–the heart of the central banking cartel. We must be getting close to the end of this chapter…  -LW


Published time: October 28, 2014 19:58
Edited time: October 29, 2014 00:05

The exterior of the headquarters of the Bank of England in London. (AFP Photo)

The exterior of the headquarters of the Bank of England in London. (AFP Photo)

In her first public address since adopting the position of BoE Deputy Governor, Nemet Minouche Shafik denounced the actions of UK traders in foreign exchange, currencies and bonds markets, warning financial misconduct in these sectors goes well beyond a few rogue financiers.A top Bank of England (BoE) official warns widespread financial crime in the City of London is eroding public trust. The BoE’s criticism surfaced as it launched a review to tackle market manipulation.

Referencing LIBOR riggers’ behavior as unacceptable, she suggested fines for such fraudulent activity were inadequate and signified “salt rubbed into the wounds to public confidence in financial markets.”

LIBOR (London Interbank Offered Rate) currently determines the cost of up to $350 trillion worth of global financial products. While the 21st century has been littered with financial scandals, Libor rigging by leading global banks has been dubbed the most flagrant in modern history.

Approximately £4 billion worth of fines have been issued for the manipulation of core benchmark rates to date, and the City is expecting further fines for the rigging of currency markets to be publicly announced in November.

(AFP Photo/DOMINIQUE FAGET)

(AFP Photo/DOMINIQUE FAGET)

(AFP Photo/DOMINIQUE FAGET)

Speaking at the London School of Economics (LSE) on Monday, Shafik warned Britain’s financial system is rigged and characterized by disproportionate rewards.

“When people read of malpractice in financial markets, of trading profits being claimed through manipulation, collusion or dishonesty, they naturally wonder if they are one of the people who have been wronged,” she said.

Joel Benjamin, a leading researcher and campaigner at UK ethical finance group Move Your Money is investigating the impact of LIBOR rigging on UK citizens and stakeholders. Benjamin warns such rate manipulation is anything but a victimless crime, and those who have suffered most in its wake remain largely uncompensated.

“The real victims of LIBOR are pension funds, SME’s fraudulently mis-sold interest rate swaps, public authorities with cash investments in the banks, and LOBO loans and PFI contracts where interest repayments increased as LIBOR was rigged lower by the banks,” he told RT on Tuesday.

‘Fix the barrel – to get rid of the bad apples’

Shafik’s address at LSE accompanied the launch of the BOE’s long-awaited review of fixed income, foreign exchange and commodities markets, collectively termed FICC. The results of the Bank’s review, first announced by Chancellor George Osborne in June, are expected to surface following the general election in May 2015.

Commenting on the implications of rate rigging, Osborne warned on Monday that financial integrity is a vital prerequisite for a thriving British economy.

But Benjamin argues Osborne has done little to help small businesses and local authorities that have suffered as a result of such financial crimes.

Britain's Chancellor of the Exchequor, George Osborne. (AFP Photo)

Britain’s Chancellor of the Exchequor, George Osborne. (AFP Photo)

Britain’s Chancellor of the Exchequor, George Osborne. (AFP Photo)

“Instead of investigating victims of LIBOR fraud and pursuing compensation, George Osborne has handed LIBOR fines to armed forces charities. LIBOR fines should be going to SMEs defrauded by the banks and to fund public services ravaged by austerity cuts borne of the bank bailouts,” he said.

Reflecting on questionable aspects of Britain’s financial sector, the BoE’s deputy governor said the tired argument that financial misconduct relates to the behavior of a “few bad apples” is “no longer credible.” Shafik suggested UK financial regulation lacks efficacy and robustness, and a regulatory overhaul is needed to“fix the barrel and to get rid of the bad apples.”

Responding to the BoE Deputy Governor’s comments, Benjamin told RT the Bank must drive and oversee a dramatic shift in Britain’s regulatory architecture.

“If the Bank of England are serious about changing the culture of British banking, that means ensuring bankers take responsibility for their actions, and that regulators hold criminal behavior to account,” he said.

Benjamin warns that “deferred prosecution agreements” currently deployed under UK law are particularly problematic. Such legislation facilitates banks in avoiding criminal penalties and keeping damning details of fraudulent activity from public knowledge, he argues.

LIBOR rigging is currently illegal under UK law. And the manipulation of currency and gold markets are set to be classified as criminal offences by the end of 2014.

But Benjamin warns political motivation to prosecute bankers responsible for rate rigging remains paltry at best.

“LIBOR was a clear conspiracy to defraud, and should be treated as such under UK law. But there is no political will to prosecute the bankers who provide over 50 percent of party political donations,” he said.

Benjamin argues that the City of London is characterized by a culture of impunity that reinforces the concept “that crime in the City by elites is tolerable and understandable, while crime on the streets is unacceptable – irrespective of personal circumstances and need.”

Source.

Canada: Decoding Harper’s Terror Game. Beneath the Masks and Diversions

An excellent article about Canadian Prime Minister Stephen Harper, his ties to Big Oil and the banking cartel, and his treachery against humanity. -LW


Global Research, October 28, 2014

Stephen Harper is the most deeply reviled Prime Minister in Canada’s history. On the world stage,  he is the servant of Big Oil boiling oil out of tar-sands to destroy major river systems and pollute the planet with dirty oil, while his attack dog John Baird leads the warmongering and bullying of nations like Iran and Syria targeted by the US-Israeli axis.

He is the most despotic and toxic first minister in the life of our country. His administration defunds every social program and life protective system it can. It strips the country of its public information infrastructures at every level – including now the gagging of non-profit NGO’s by eliminating their charitable status if they question any policy of his regime.

Just as his friend George Bush Jr., Harper holds government by big-money backing, continual lies, attack ads, and life-blind policies to enrich the already rich. Canada’s neo-con political class may have its head on backwards, but Harper is very cunning in skirting, subverting and perverting the law to abuse power at every level. He is the poster boy of the global corporate agenda of wrecking society and its common life support systems.  

Harper also owes his political life to the RCMP. After a after non-confidence vote triggered the 2006 election, RCMP commissioner Giuliano Zaccardelli instructed his staff to include former Liberal finance minister Ralph Goodale’s name in a news release announcing a criminal investigation. This reversed the stench of the Harper regime’s continuous scandals and corruption onto the Liberals by a false RCMP smear. As a former top insider of the Tory party advised me, “the RCMP won the election for Harper”. The re-elected Harper regime then surrounded the RCMP with blocks to silence all facts – the signature operation – so the truly deepest scandal of the era proceeded with impunity to the present day. So it is not surprising that CSIS, the RCMP and Harper are collaborating to get more secret powers for the police and spooks in return for serving Harper’s underlying agenda.

How “Acts of Terrorism” Fit the Known M.O. 

Harper certainly needs an accepted domestic enemy to save him from the rising revulsion of the thinking public against his rule. His regime’s record of destroying the life substance of Canada piece by piece cannot be denied. One already knew what was coming when Harper immediately called the crazed run-over of soldiers in Quebec on October 20 “a terrorist act” about which he was “deeply worried”. In fact, it was the act of a criminally insane loner run amok in a small Quebec town without any evident objective as required under the law’s definition of terrorism. But with the foreknowledge of his addled Islam by the RCMP and CSIS, he seems to have been an ideal patsy for Harper’s home “terrorism” claim. He had already been arrested and his passport cancelled in June. We can imagine how an effective undercover agent might have whipped him into a Jihad frenzy knowing he would soon be full of holes and unable to report what happened.

One can more clearly see such a scenario in the case of the clinically insane, drug-addicted petty criminal living in a homeless shelter in Ottawa who had warned a judge in front of the police back in 2011:”‘If you can’t keep me in, I’m going to do something”. Who could have been a better tool for the events to come? On October 22 after the first “As a “radicalized terrorist” attack, a double-barrelled shotgun impossible to hide that no-one saw before ended up in the hands of Micheal Zebaf-Bibeau. The rest is history. He went on a killing spree with no known blood testing afterwards for the drugs he was evidently driven by in the video record of his frenzied and super-charged behaviour, just as there was no known test of the body of crazed drive-over killer, Martin Couture-Rouleau. How extraordinary. How unspoken in the lavish profusion of other details and official false connection to ISIS.

“Terrorist” stops the mind, and “jihadist” locks it in. Harper’s first invocation of the mind-stopper was, as always, strategic. Although blood tests for a substance-abuse driving offense are automatic, none was reported although the videos show every sign of chemical possession. Bibeau too went crazy and was dead with countless bullets through him before any questions could be asked. All such strange coincidences are part of the now familiar covert-state MO.

Joining the Dots

Since Harper publicly claimed an “act of terrorism” two days before the sensational Ottawa murder and crashing of Parliament and as soon as the Quebec killing occurred, questions arise. The normally zipper-lip Harper did so long before any forensic facts were in, and before the idea even occurred to anyone else. Why? Revealingly the federal security state had been running war games exercises depicting just such attacks weeks before the crazed murders (Canadian Authorities Ran War Game Drills Depicting ISIS Attack Scenarios Brandon Martinez, GlobalResearch, October 24, 2014). Lone-wolf nut cases, killings out of nowhere, unknown motivators and arming, and the state leader most profiting from  mutation of the demented murders into “terrorist acts” before anyone else – – who joins the dots? It is taboo to think through such situations, and this too is known beforehand. Sure enough within the day, the RCMP and CSIS get the new extraordinary powers they sought, and for the first time in office the robotic Harper is behaving with a warmth not even extended to his young son with whom he shakes hands in farewell. He is hugging opposition leaders in Parliament to show a new human side to complete the image makeover in motion.

Harper is happy because he thinks his next election is saved. But the first forensic question in acts of murderous crimes is again never asked. The hypnotic trance of “terrorism” in sedate  Ottawa holds the narrative unchallenged. Cui bono? Who benefits from these unbelievable closed-case murders in two days which have the media headlining “terrorism” and “anti-terrorist legislation” everywhere Canadians look, and Harper now as the strong hand in charge. The top banner headline of the weekend Globe screamed “How far should we go?”

Home-Grown Terror for Harper’s Re-Election

The first function of the terrorist claim is the standard one – diversion from the ailing economy and the majority’s growing revulsion of the leader and his party. Harper has made enemies of every thinking Canadian in the country by his stripping of the country’s public life and knowledge bases, and reversing the country’s global reputation as an agent of peace, social conscience and reverence for nature. Diversion to a constructed Enemy is the oldest strategy in the book of despised heads of state, and Harper is in unprecedented need for distraction to another target to uplift him at the same time. Bush Jr. ran on this formula for eight years.

If the stratagem is not seen through, the second big boost to Harper will be to justify the despotic rule and quasi-police state he has built with ever more prisons amidst declining crime, ever more ant-terrorist rhetoric and legislation, ever more cuts to life support systems and protections (the very ones which would have prevented these murderous rampages), and ever more war-mongering and war-criminal behaviours abroad. The evil regime of despotic control and life oppression he has instituted surpasses any ill rule in the nation’s history. As the US prototype of the life-blind right wing has taught him, the greatest justification of one’s rule is knee-jerk hatred of a safe Enemy. But in Canada, that does not work over time. So the domestic “acts of terrorism” in Quebec and Ottawa itself provide the needed Enemy within Canada to justify anything with ever new pomp, mandatory agreement of others, and ruling power at centre stage.

Diagnosing the Drive to Total Control

The rest follows. The “New Terrorist Laws” in execution were already the feature news headline on Oct 25, allowing for any new surveillance and control of citizens. Keep in mind our already-installed totalitarian airport regime that deprives people of water and hygiene products, dehumanizes all, and undresses millions with no questions allowed any step of the way. It is a synecdoche of the larger total rule advancing with the Harper gang in charge further than ever before. “Nothing can be the same again” cheer the corporate media in choral support.

More favours to the Harper regime from the RCMP and CSIS may be in store – for example, false allegations and naming of even the most honest opponents like Ralph Goodale who spent “the worst year of my life” recovering from the RCMP smear that kept Harper in power. It is a bit like the War Measures Act – new capacity to lock down any city at any time with armed-force control pervading the streets and police-army powers in the glory of mass-controlling armed command and kill license. It has already happened in Ottawa with a lone crazy, and the lock-down was infinitely more heavy-handed than in 1970 Montreal which I observed first hand. Keep in mind the trumped-up cause for it – one likely-drugged and managed murderous homeless mental case dead before any questions could be asked.

Observe too how the language changes to fit the agenda of total control. The keys are “terrorists” for lone individuals driven crazy with no more social supports for them, and “radicalization” with no modifier as the ultimate problem of thought behind the terror. What deprived group or oppositional rethinking cannot be so labelled? These psych-ops are already in full motion now. They have been minted into ruling group-mind by the mocked-up “terrorists attacks” at home, and Harper rule can only go further by such trances of normalized stupefaction now reinforced with Canadian blood.

Behind all the public psych-ops is the operation of reverse projection long perfected by the US war-machine. Blame the opposition for what you are doing as the reason for attacking them. At the Canada level, the reverse projections define the Harper regime. He is punitively and vindictively despotic, rigidly and vengefully doctrinaire, intolerant of deviation, shames and slanders at will, and overrides every democratic constraint to his insatiable drive to total control. Narrow and life-blind absolutism, indifference to others’ suffering, and certitude of virtue while destroying people and common life support systems complete the unseen rule of terror at work. A coterie of mediocre and corrupt subordinates surround and serve him to allow no shard of light in on the ruling mission of society destruction.

With most people not yet suspecting it, Harper rule is an Americanada mirror image of the jihad-fascism he uses to multiply his and his corporate allies’ rights and powers. Behind him lies the transnational money-sequence cancer he embodies in every policy line.

Prof. John McMurtry is the author of The Cancer Stage of Capitalism/ From Crisis to Cure

Source.

Some Results from This Month’s Financial War Games

Earlier this month, “Financial War Games” were held in the United States and European Union. Here, the EU results as analyzed, and it seems they were anything but legit. -LW


Another Unbelievable Stress-Free Test; Whitewash Math and Deferred Tax Assets

In an effort to fool the public into believing the latest round of bank stress tests were actually designed to find stress, the ECB found 25 scapegoats, with the biggest losers in Italy and Greece.

Interested parties may wish to slog through the full 178 page Stress Test Report.

Capital Shortfalls


Non-Performing Loans

Here’s a chart from PDF page 75 (report page 67) with thanks toZeroHedge.

There is €879 billion in nonperforming loans but the report concludes bank assets are only €48 billion overstated. Apparently we are to believe there are adequate loan loss provisions for rest.

Reuters reports ECB Fails 25 Banks in Health Check but Problems Largely Solved.

 Roughly one in five of the euro zone’s top lenders failed landmark health checks at the end of last year but most have since repaired their finances, the European Central Bank said on Sunday. Italy faces the biggest challenge with nine of its banks falling short and two still needing to raise funds.

“This seems as if it has been pretty unstressful,” said Karl Whelan, an economist with University College Dublin.

“The real issue is the size of the capital shortfall and that is very, very small. I don’t feel a whole lot more reassured about the health of the banking system today than last week.”

€48 Billion Shortfall

The Financial Times reports ECB Says Banks Overvalued Assets by €48bn.

 The European Central Bank’s dissection of the books of the eurozone’s biggest banks has found lenders overvalued their assets by €48bn.

The results of the ECB’s examination of balance sheets worth €22tn, known as the Asset Quality Review, will require the 130 lenders who took part in the exercise to adjust the value of their assets in their accounts or prudential requirements.

A quarter of the reduction, €12bn, will fall on Italian lenders, an amount just short of 1 per cent of their risk-weighted assets. Greek banks will have to lower their asset values by €7.6bn, or almost 4 per cent of their risk-weighted assets.

Philippe Legrain, an economist and former adviser to then European Commission president José Manuel Barroso, described the tests as a “whitewash”.

“The ECB singles out less important banks in less important countries and gives the German banks a clear bill of health,” Mr Legrain said.

German lenders will have to lower the value of their assets by €6.7bn and their French counterparts by €5.6bn.

The AQR reviewed 800 portfolios, which together made up more than 57 per cent of banks’ risk-weighted assets. The ECB said they examined 119,000 borrowers and valued 170,000 items of collateral. Supervisors also built 765 models to challenge banks’ estimates of their provisions.

The 130 banks account for 81.6 per cent of all eurozone assets.

Whitewash Math

Non-performing loans total €879 billion out of a total balance sheet of about €22 trillion. That’s approximately 4% of loans.

Of the 130 banks, 25 failed. That seems like a lot. However, the total amount of under-capitalization is a mere €48 billion. That is an overall asset overvaluation of a mere 0.218%.

Anyone seriously believe that €48 billion is credible with France, Italy, and Spain in or near recession (and Germany heading there)? I don’t. It’s not even a generous rounding error.

Have Spanish banks written off 100% of their bad property loans? What about sovereign bonds assumed to be 100 percent risk-free? Didn’t Greece prove bonds payments are not sacrosanct?

What happens when the eurozone splinters? Here’s the answer: German banks are going to take a massive hit.

Deferred Tax Assets 

Huky Guru has some interesting figures about Spanish banks.

About a year ago, Guru reported that a Reclassification of DTAs(Deferred Tax Assets) provided an extra €30 billion capital for Spanish banks.

Guru brought up the subject again today in Putting the Stress Tests in Context.

Paraphrasing Guru … Accounting magic and government decree has allowed banks to compute an extra €30 billion in capital for Spanish banks via DTAs. Without that €30 billion, the average Tier 1 capital for Spanish banks would have fallen from 9.1% to 7.1%. More than one bank would have failed the test.

Spanish Banks Plow Into Spanish Sovereign Bonds

Guru notes “Spanish banks hold Close to €231.519 billion in Spanish bonds, almost twice around the capital of the Spanish banking system.

At least six Spanish banks have massive leverage in bonds. Catalunya Banc and NCG are particularly exposed.

Conclusion

The entire exercise was another stress-free farce.

Mike “Mish” Shedlock

http://globaleconomicanalysis.blogspot.com

Source.

Forex-Rigging Fines Could Hit $41 Billion Globally

Banks could have to pay as much as $41 billion globally to settle probes into allegations traders rigged benchmarks in the currency markets,Citigroup Inc. (C) said today.

Deutsche Bank AG (DBK) is seen as probably the “most impacted” with a fine of as much as 5.1 billion euros ($6.5 billion), Citigroup analysts led by Kinner Lakhani calculated, estimating the Frankfurt-based bank’s settlements could reach 10 percent of its tangible book value, or its assets’ worth.

Using similar calculations, Barclays Plc (BARC) could face as much as 3 billion pounds ($4.8 billion) in fines and UBS AG (UBSN) penalties of 4.3 billion Swiss francs ($4.6 billion), they wrote in a note first sent to clients on Oct. 3.

Authorities around the world are scrutinizing allegations that dealers traded ahead of their clients and colluded to rig currency benchmarks. Regulators in the U.K. and U.S. could reach settlements with some banks as soon as next month, and prosecutors at the U.S. Department of Justice plans to charge one by the end of the year, people with knowledge of the matter have said.

Spokesmen for Deutsche Bank, Barclays and UBS declined to comment on the Citigroup estimates.

The Citigroup analysts made their calculations using a Sept. 26 Reuters report that the U.K. Financial Conduct Authority settlements could include fines totaling about 1.8 billion pounds. They derived their estimates for how high fines could go in other investigations from that baseline, using banks’ settlements in the London interbank offered rate manipulation cases as a guide.

“Extrapolating European and, more importantly, U.S. penalties from a previous global settlement suggests to us a total potential global settlement on this key issue,” they said in the note.

Cooperation Rewards

U.K. authorities will probably account about $6.7 billion of fines across all banks, according to the Citigroup analysts. Other European investigations will account for $6.5 billion. Penalties in the U.S. cases could be about four times greater, hitting $28.2 billion.

The Citigroup analysts didn’t take into account the possible effect of banks’ collaboration with investigators. That can have a big impact on the size of the fines, lowering and even wiping out a penalty in some cases.

UBS and Barclays saw $4.3 billion worth of antitrust fines waived by European Union authorities in December in exchange for their early and full cooperation. Six others were fined 1.7 billion euros in that case, which involved rigging euro and yen interest rate derivatives.

UBS has sought leniency in exchange for handing over evidence of misconduct to U.S. antitrust investigators in the foreign-exchange probes, and was also the first to step forward to cooperate with the EU, people with knowledge of the matter have said.

To contact the reporter on this story: Richard Partington in London at rpartington@bloomberg.net

To contact the editors responsible for this story: Simone Meier at smeier@bloomberg.net Heather Smith, Edward Evans

Source.

House Purchases Delayed After Real-time Payment System Goes Offline

Bank of England’s Real Time Gross Settlement payment system, which processes £277bn of money transfers a day including UK house purchases, resumes operations after being down for more than nine hours


The Bank of England has responsibility for RTGS Photo: DANIEL JONES

The Bank of England has responsibility for RTGS Photo: DANIEL JONES


By James Titcomb

4:14PM BST 20 Oct 2014

Update: The Bank of England says the system is back online, and that RTGS will remain open until 8pm on Monday ­ four hours later than usual ­ to process the backlog of orders.

CHAPS, which deals with the payments, says: “The Bank of England’s RTGS system is now processing payments again following a resolution of the technical issue experienced earlier today. As such, CHAPS is now processing the backlog of payments and is confident that all payments submitted today will be processed today.”


House purchases and other large transactions were unable to be completed on Monday after the infrastructure that processes large payments between British banks went offline, the Bank of England has said.

The central bank said the “Real Time Gross Settlement Payment System” (RTGS), which settles large transfers between banks, had gone offline at 6am on Monday morning. It remained so until late on Monday afternoon and will stay open until 8pm to deal with a backlog of payments.

The Bank said that the biggest payments were being processed manually and reassured the public that all payments would be on Monday, since the system has the capacity to process a large number of payments when it does go back online.

Smaller payments such as standing orders and direct debits use a different system and were not affected.

The RTGS is set up to settle large payments in real time, rather than at the end of the day, reducing risk.

The system ­ which processes payments such as house purchases ­ went down at 6am on Monday morning. The large banks were contacted early in the day, and the Bank disclosed the fault at around 11.30am.

Jonathan Harris, of the mortgage broker Anderson Harris said the issue could be “hugely inconvenient for buyers”.

“It is hugely fortunate that the Chaps system didn’t collapse on a Friday as this is by far the busiest day of the week for completions. However, with everyone pushing to complete on a Friday there are a proportion of deals which don’t happen ­ maybe 15pc ­ which are pushed back to the following Monday. These are already critical and if they are delayed yet again, it will be hugely inconvenient for buyers,” he said.

“Those in a long chain in particular will feel a cascading effect down the chain with potentially many people affected. Presuming the system is back up and running on Tuesday, then these deals should be able to complete then.”

The Bank of England said: “The Bank of England has identified a technical issue related to some routine maintenance of the RTGS payment system and has paused settlement while we resolve it.”


bankofengland Bank of EnglandBank of England issues statement on technical issue with RTGS http://t.co/VBzokdrsGy http://t.co/qhV3qR9dWv About six hours ago via Twitter Web Client  Favorite  Retweet Reply


“We are working to address this issue as quickly as possible, and restart the RTGS payment system in a controlled manner. The most important payments are being made manually and we can reassure the public that all payments made today will be processed.”

The RTGS routes payments made through CHAPS (the Clearing House Automated Payments System), which settles important and time­-sensitive payments, including house purchases.

According to the CHAPS website, it processed £70 trillion of payments last year and is used by 5,000 financial institutions.

A statement from CHAPS said it would be keeping operations running longer than normal on Monday afternoon to ensure that they go through.

” CHAPS is currently liaising with the Bank of England who are working hard to resolve the issue – which means payments submitted today will be processed,” it said.

The system helps keep the day­to­day running of banks going by acting as an intermediary between banks. If a payment is going to be made between banks, RTGS credits the bank receiving the funds quickly, and takes funds from the bank sending money, removing the risk for the receiving bank.

In effect, RTGS sits at the top of the payment structure for banks, as shown by this Bank of England document:

Bank of England

The other major payment system that uses RTGS is CREST, which processes transactions for financial instruments such as shares and bonds. However, CREST is not believed to be affected.

Euroclear, which runs CREST, said: “Euroclear is monitoring the current technical issue with the RTGS system at the Bank of England. We are working closely with the BoE and if necessary will extend our own operational deadlines, to ensure that all settlement and payment instructions will be processed today.”

Around £277bn a day is processed through CHAPS, up from the £254.5bn in 2011:

Bank of England

The financial analyst Lorcan Roche Kelly said the event was “every central bank’s nightmare”.


LorcanRK Lorcan Roche KellyThis is every cb’s nightmare (presume will be fixed fast) RT@fastFT: Bank of England pauses RTGS payment system http://t.co/Mzk64Q775U About five hours ago via TweetDeck  Favorite  Retweet  Reply


© Copyright of Telegraph Media Group Limited 2014

 

Virginia Files Billion-Dollar Suit Against Banksters

• Virginia files lawsuit against plutocrats who conned state with toxic mortgages.

By Ronald L. Ray —

True to its state motto — “Sic semper tyrannis,” or “Thus always to tyrants” — the Commonwealth of Virginia has brought a$1.15 billion civil fraud lawsuit against a “banker’s dozen” of the largest international investment houses. Attorney General Mark R. Herring announced the case in mid-September, which was filed in Richmond Circuit Court. In a prepared statement, the Office of the Attorney General (OAG) alleged that the big banks deliberately misrepresented the quality of residential mortgage-backed securities (RMBS), a form of financial derivative, sold to the Virginia Retirement System (VRS), beginning in 2004.

Prior to 2010, “Virginia was forced to sell the vast majority of these toxic securities built on junk mortgages and lost $383 million.” The attorney general now seeks to obtain the maximum penalty allowed by law, in order to redress the harm done to Virginia taxpayers. The OAG expects that the money recovered will go to repay the taxpayers and VRS for their losses.

In a virtual “who’s who” of plutocratic pirates, 13 mega-banks have been accused of violating the commonwealth’s 2002 Fraud Against Taxpayers Act, which permits treble damages for losses, plus additional penalties.

According to the Richmond Times-Dispatch, however, two JPMorgan Chase subsidiaries, JPMorgan Securities LLC and WAMU Capital Corporation (formerly Washington Mutual), were dropped subsequently, when the OAG learned that Herring’s predecessor, Kenneth T. Cuccinelli II, had previously reached a secret settlement with the two firms for $3 million. Depending on circumstances, however, they could be sued in the future.

The remaining “banker’s dozen” are subsidiaries of the world’s biggest institutional usurers: Barclays, Citigroup, Countrywide, Credit Suisse, Deutsche Bank, Goldman Sachs, RBS, HSBC, Morgan Stanley, UBS and Merrill Lynch.

In brief, Virginia alleges that 220 securities it purchased were offered as being rated AAA or similarly, with 0% delinquency. This factor is important to institutional investors like Virginia because ofthe need for a stable and secure return. However, 75% of the mortgages eventually defaulted. The RMBSs were backed by 785,000 mortgages, of which 40% were “fraudulently misrepresented.” The OAG stated that the banks “knew, or shouldhave known,” that claims in their prospectuses and sales presentations were false.

The fraudulent practices were discovered by Integra REC, LLC, “using extremely sophisticated proprietary methods” to match RMBSs with the respective individual mortgages, said the OAG.

The first of three main accusations is that the banks misrepresented the loan-to-value ratio (an indication of likely default). On average, only 23.4% of loans were represented as being for more than 80% of property value, when it was really 54%. Fifteen percent were “underwater.” Further, rates of owner occupancy were overstated significantly, and second mortgage numbers were severely understated. Both of these latter factors also contribute to delinquency rates.

Herring stated: “Every Virginian was harmed by the financial crisis. Homes were lost, retirement accounts were devastated, small businesses saw their credit dry up almost overnight. . . . I will notallow Virginians to be left holding the bag for the reckless, fraudulent business practices of a few big banks who thought they were above the law. These banks lied to Virginia, and taxpayers and [nearly 600,000] state employees lost hundreds of millions dollars as a result.”

As a measure of Herring’s confidence and resolve, the Commonwealth of Virginia has demanded a jury trial. It is to be hoped that true justice will be served, and that there will be no further secret settlements that allow the plunderous plutocrats to return to usury as usual.

Despite a nearly endless stream of revelations of the moneylenders’ wrongdoing—now including collusion by the Federal Reserve—at least one apologist for the weasels of Wall Street, Matthew E. Fishbein, suggests in the New York Law Journal that the banksters and other corporate criminals are the victims, forced by evil government lawyers to admit to things they believe they did not do. He goes so far as to call cases similar to the Virginia lawsuit “marginal,” because they involve only a few hundred million dollars.

But the truth is that the international bankers are usurious pirates, bent on sucking every cent out of the nearly empty pockets of widows and orphans. They have created a corporate culture ofcorruption, which is destroying nearly every economy on the face of the planet. It is time to end the financial pharaohs’ stranglehold on the common man by ending usury and putting every single one of these predatory banks out of business.


Ronald L. Ray is a freelance author and an assistant editor ofTHE BARNES REVIEW. He is a descendant of several patriots of the American War for Independence.

Source.

Money – The Ultimate Consciousness Pacifier

This video offers a great explanation of how the money supply works, and why we should expect some big changes in the world of money. (Some of them have already begun). -LW

Video Description

Money is a fabric of our present reality. Even though this should be taught in school for this reason. You would lucky to meet one in a thousand who understands it. As someone who taught myself currency trading to learn the banking system itself to appreciate the impact on humanity. I offer some wonderful teachers who share their perspectives on this. Those who articulate it in a way that makes something very complex seem vastly simple. For, if we are to move forward as a life form. We need to know where we have come from to appreciate the reality to move forward. Do we want to do it with a banking system?

We have the BRICS option which is justifying Russia’s demonisation due to them being the institutional threat to the present paradigm. We also have Crypto Currencies like Bitcoin. I also think there is an even more obscured … Appreciating each other’s life force and interact like a tribe. For if you choose that. You see your fellow man as an investment. You are the one who determines their value. Treating each other like we would in an Indigenous / Pay it Forward attitude. Investing our energy into our fellow man rather that privately owned Hierarchical Oligarchy. I see my fellow man as having an infinite value compared to this present reality’s effort to not value humanity. Because a concentration of wealth in a few is not possible. But, this has to be your choice.

I believe that the whole purpose of this dance is the consciousness awakening that is the ultimate money pacifier. But, it has to be a personal choice.

Your answer amongst all this is up to you. See the value in investigation an learning. Gaining an understanding is a powerful ally to not only you but all around you. But, hang in there. There is purpose to this all.

‘Fraud and Falsehood Dread Investigation, Truth Invites it’ – Thomas Cooper. Is the money system inviting investigation? Or dreading it?