NO ADVERTISING, GOVERNMENT OR CORPORATE FUNDING

  • Latest News
  • Pitch a Story
  • Work with a Journalist
  • Join the Blog Squad
  • Afghanistan
  • Africa
  • Asia
  • Baltimore
  • Canada
  • Egypt
  • Europe
  • Latin America
  • Middle East
  • Russia
  • Economy
  • Environment
  • Health Care
  • Military
  • Occupy
  • Organize This
  • Reality Asserts Itself
  • US Politics
  • JP Morgan Will Not Be Criminally Prosecuted for Its Role in Madoff's Ponzi Scheme


    JP Morgan served as the principal bank for Bernie Madoff, causing losses of $20 billion, yet they will pay only $2.6 billion in settlement charges -   October 3, 14
    Members don't see ads. If you are a member, and you're seeing this appeal, click here


    Audio

    Share to Facebook Share to Twitter



    TRNN is giving us real understanding of the issues and a way around the corporate news spin. - heylair
    Log in and tell us why you support TRNN

    Bio

    William K. Black, author of The Best Way to Rob a Bank is to Own One, teaches economics and law at the University of Missouri Kansas City (UMKC). He was the Executive Director of the Institute for Fraud Prevention from 2005-2007. He has taught previously at the LBJ School of Public Affairs at the University of Texas at Austin and at Santa Clara University, where he was also the distinguished scholar in residence for insurance law and a visiting scholar at the Markkula Center for Applied Ethics.

    Black was litigation director of the Federal Home Loan Bank Board, deputy director of the FSLIC, SVP and general counsel of the Federal Home Loan Bank of San Francisco, and senior deputy chief counsel, Office of Thrift Supervision. He was deputy director of the National Commission on Financial Institution Reform, Recovery and Enforcement.

    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.

    Transcript

    JP Morgan Will Not Be Criminally Prosecuted for Its Role in Madoff's Ponzi 
SchemeKAYLA RIVARA, TRNN PRODUCER: Welcome to The Real News Network. I'm Kayla Rivara in Baltimore. And welcome to this latest edition of The Black Finance and Fraud Report.

    Now joining us is Bill Black. Bill is an associate professor of economics and law at the University of Missouri-Kansas City. He's a white-collar criminologist and a former financial regulator. He's also author of the book The Best Way to Rob a Bank Is to Own One. And he's a regular contributor to The Real News.

    Bill Black, thank you so much for joining us.

    BILL BLACK, ASSOC. PROF. ECONOMICS AND LAW, UMKC: Thank you.

    RIVARA: So right now it looks like JPMorgan is set to pay a possible $2.6 billion in settlements, this time pertaining to the Bernie Madoff situation. Can you give us the latest on this and what it really means for enforcing accountability on Wall Street firms?

    BLACK: Yeah. It's a brand-new year, but it's the same old JPMorgan and the same old Justice Department. And so we have JPMorgan in what is about the 12th massive fraud scheme, measured by causing losses of well over $100 million. In this case, it helped--contributed to losses of well above $20 billion, though it's going to be allowed to settle for about $2.5 billion. About $1.7 billion goes to the Justice Department, about $250 million goes to the financial regulator, the Office of the Comptroller of the Currency, and about $500 million goes to the individual civil plaintiffs who say they were defrauded by Bernie Madoff. Now, the Justice Department money will flow through to the victims of the Madoff fraud.

    What's this all about? It's that JPMorgan Chase knew--first, it served as the principal banker of Madoff. And second, it knew that Madoff had violated a whole series of things that should have led JPMorgan to alert the Justice Department through a criminal referral of likely criminal action. In fact, a JPMorgan executive said that what was going on was almost certainly a Ponzi scheme.

    On top of that, JPMorgan alerted the British banking authorities, but not only didn't alert the U.S. banking authorities; it stonewalled them and worked very hard to keep them from learning about the Madoff frauds.

    And when the Office of the Comptroller of the Currency, the federal regulator for JPMorgan, finally learned about this stuff and went to JPMorgan to get the information they had so that they could try to put together whether Madoff was engaged in a Ponzi scheme, JPMorgan refused to give the information and the Justice Department refused to enforce the subpoena.

    So, accountability? Not so much. No criminal action, no individual defendants are going to pay anything at JPMorgan. Nobody's going to lose their job at JPMorgan. Nobody's going to lose their bonus at JPMorgan. And the Justice Department is crowing about another massive victory, because they got fairly big bucks, but, of course, compared to the losses caused, fairly small bucks as well.

    So, new year, same old same old.

    RIVARA: So from here there's nothing to be expected? Are there going to be any more proceedings, legal proceedings with this? Or is it a closed case?

    BLACK: It's a deferred prosecution agreement, which is a lot of big words for we ain't going to prosecute you. And officially, two years from now it will all go away and it'll be as if the Justice Department was never involved.

    RIVARA: Well, Bill Black, thank you so much for joining us.

    BLACK: Thank you.

    RIVARA: And thank you for joining us on The Real News Network.

    End

    DISCLAIMER: Please note that transcripts for The Real News Network are typed from a recording of the program. TRNN cannot guarantee their complete accuracy.


    Comments

    Our automatic spam filter blocks comments with multiple links and multiple users using the same IP address. Please make thoughtful comments with minimal links using only one user name. If you think your comment has been mistakenly removed please email us at contact@therealnews.com

    Comments


    Latest Stories


    Republican Abortion Ban Could Put Pregnant Women's Lives in Peril
    GOP Leadership's Invitation to Netanyahu a Provocation Aimed at War with Iran
    'We are going to destroy the Greek oligarchy system'
    TRNN Replay: What are the Saudis Afraid Of? - Madawi Al-Rasheed (2/5)
    Greek Right Fears First Left Government in Greek History
    Pre-Election Posturing Behind Netanyahu's DC Visit
    SYRIZA Heads Towards a Majority in Greece as Elections Approach
    How Obama Can Reduce Carbon Emissions Without Congress
    Feds Won't Pursue Civil Rights Case Against Darren Wilson
    TRNN Replay: American Alliance with Saudi Dictatorship is Hypocrisy Dressed Up as "Realism"
    What Triggered AETNA's Pay Raise to $16/hour?
    Climate Change Crisis Buried in the State of the Union
    The Socialist Response to the State of the Union
    The Global African: Top Stories of 2014
    Can the Union Be Strong Amidst Global Recession?
    No Black or White America says Obama
    Does Obama's Support of TPP Contradict His Immigration Policy?
    Israel Kills Hezbollah Leaders Ahead of Elections
    GOP to Obama: North Korea Sanctions Aren't Enough
    The Making of Norman Finkelstein - Reality Asserts Itself (8/8)
    Removing the Social Security Tax Cap Would Benefit Most Workers
    The SYRIZA Challenge in Greece (2/2)
    The SYRIZA Challenge in Greece (1/2)
    The Function of Police in Modern Society: Peace or Control?
    Netanyahu's Elbowed Presence in Paris
    Lee-Jackson Day: Honoring Civil War Heroes Or Upholding White Supremacy?
    The Making of Norman Finkelstein - Reality Asserts Itself (7/8)
    Police Violence and Militarization Town Hall
    What is Causing Market Volatility?
    Baltimore Activists Participate in National Day of Action Against Police Brutality

    RealNewsNetwork.com, Real News Network, Real News, Real News For Real People, IWT are trademarks and service marks of IWT.TV inc. "The Real News" is the flagship show of IWT and Real News Network.

    All original content on this site is copyright of The Real News Network.  Click here for more

    Problems with this site? Please let us know

    Linux VPS Hosting by Star Dot Hosting