PBS. Emphasis added.
William K. Black thinks President Obama didn’t acknowledge a key component in the financial crisis that the bills before Congress won’t address — fraud. A former regulator who helped crack down on massive fraud during the savings and loan crisis in the 1980s, Black tells Bill Moyers on The Journal that, despite evidence of fraud at the top banks, prosecutions seem far away. “If you go back to the savings and loan debacle, we got more than a thousand felony convictions of the elite. These are not, you know, tellers or something. We today have zero convictions, zero indictments, zero arrests of any of the elite, non-prime lenders that, through their fraud, drove this crisis.”
Black developed the concept of “control fraud” — frauds in which the CEO or head of state uses the entity as a “weapon.” Control frauds cause greater financial losses than all other forms of property crime combined. He recently helped the World Bank develop anti-corruption initiatives and served as an expert for OFHEO in its enforcement action against Fannie Mae’s former senior management.
Please, let’s not have any squeaking by liberals moaning about how the recession is solely the fault of Republicans. The Glass-Steagall Act was repealed during the Clinton Administration and directly led to the rise of the banksters. Clinton thought it was a swell idea and heartily endorsed the idea of destroying decades of sensible and effective bank regulation.
Now why do you suppose the Administration and Congress would be ignoring fraud? Former Labor Secretary Robert Reich knows why. Congress is currently pretending to get tough on the financial sector but also needs its deep pockets to fund the upcoming mid-term elections. Make no mistake about it, this is bi-partisan corruption, both parties are equally culpable and compromised.
And of course, Sen. Dodd (D-Corrupticut) is right in the middle of it all, sliming the way to a pretend financial reform while keeping everything essentially the same for Wall Street.
Senator Dodd wants some financial reform – enough to declare victory – but not so much as to seriously undermine the prevalence of megabanks on Wall Street. You can take whatever view you like on his motivation – but Senator Dodd himself is quite open about his thinking and intentions.
Of course, he’s just one of the more odious and obviously comprised members of Congress. Folks, our system is rotten at the core. But change is happening. Outrage from the public continues to force Congress and the Obama Administration to make changes whether they want to or not. This is our strongest weapon. We need to keep the pressure on. Also, the head of SEC enforcement, and this has direct bearing on the Goldman fraud case, is the real deal.
Robert Khuzami is a bad ass, no-nonsense, thorough, award winning Prosecutor: This guy is the real deal — he busted terrorist rings, broke up the mob, took down security frauds. He is now the director of SEC enforcement. He is fearless, and was awarded the Attorney General’s Exceptional Service Award (1996), for “extraordinary courage and voluntary risk of life in performing an act resulting in direct benefits to the Department of Justice or the nation.”
When you prosecute mass murderers who use guns and bombs and threaten your life, and you kick their asses anyway, you ain’t afraid of a group of billionaire bankers and their spreadsheets. He is the shit. My advice to anyone on Wall Street in his crosshairs: If you are indicted in a case by Khuzami, do yourself a big favor: Settle.
The only way the system will change is by We The People making it change. It can not and will not willingly change itself. As far as I’m concerned, the more peasants with pitchforks in the streets, the better.