Make Real News!

100K Challenge!

$50,514 raised so farEND DATE: October 3   
Every dollar you donate will be matched until we reach our 100K goal!
  • 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
  • Black Financial and Fraud Report


    Bill Black: Government Sues Bank of America but No Criminal Prosecutions -   October 26, 2012
    Members don't see ads. If you are a member, and you're seeing this appeal, click here


    Audio

      Share to Twitter
    Share to Facebook




    I support the Real News Network because it gives members an opportunity to make uncensored comments. - David Pear
    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

    Black Financial and Fraud ReportJESSICA DEVARIEUX, PRODUCER, TRNN: Welcome to The Real News Network. I'm Jessica Desvarieux in Baltimore.

    Now it's time for our weekly report with Bill Black. Bill Black is an associate professor of economics and law at the University of Missouri–Kansas City. He's a white collar criminologist and former financial regulator. He is the author of The Best Way to Rob a Bank Is to Own One and a regular contributor to The Real News. Good to see you, Bill.

    BILL BLACK, ASSOC. PROF. ECONOMICS AND LAW, UMKC: Good to see you.

    DEVARIEUX: So what do you have for us this week? What are you working on, Bill?

    BLACK: Well, we have the new civil fraud suit just filed on Wednesday by the Justice Department against Bank of America that describes, to use the words of the prosecutors, a brazen fraud that went on for about three years, that caused billions of dollars in losses to the taxpayers, and they're not going to prosecute.

    DEVARIEUX: Okay. Okay. And what does that mean for us everyday citizens, that they're not going to prosecute? Are they just going to get away with it? What happens next?

    BLACK: Ah, that would be you betcha in terms of the individuals. So the individuals are not being prosecuted. The corporations are not being prosecuted.

    But there is a civil suit—not against the individuals who caused the fraud and got rich through it, but only against the Bank of America. And the interesting news in all of this is that this was prompted by a whistleblower, and not just a whistleblower, but a whistleblower who tried to prevent this disaster who was an executive vice president within Countrywide, warned them that if they did this it would produce massive fraud, then did a study that proved that it resulted in massive fraud, and in the case of liars' loans documented a 70 percent fraud rate, which everybody knew was going to be sold to Fannie and Freddie, which everybody knew was going to be bailed out by all of us. So it comes out of our pockets as well. And when he went to his bosses, this whistleblower, whose name is Mr. O'Donnell, with this evidence that it produced massively fraudulent lending, the bosses suppressed his study and ordered an expansion of the fraudulent loans, which they then, as I said, sold to Fannie and Freddie.

    And the Justice Department knows all of this, but not only didn't prosecute, but apparently wasn't even asked by the mainstream media why it wasn't bothering to prosecute things that it described as brazen frauds that went on for years and were led from the absolute top of the organization.

    DEVARIEUX: Well, Bill, I have a question for you. Even when there is—they are prosecuted and there is a settlement—as you remember, about six months ago there was that $25 billion settlement—there's been a study that was released that only half of those funds have actually gone to housing-related issues, you know, to prevent foreclosures, building communities, things of that nature. What do you make of that study?

    BLACK: Well, first, those people were not prosecuted. There was a deal to have zero prosecutions, which is a complete outrage.

    Second, we all knew and warned at the time that the money wasn't necessarily going to housing. Right? So the deal was, the money went to the states, in large part. And as we know, states are often in dire financial catastrophe. And so it's going to go to wherever the powers that be in the state want that money to go, which is frequently not to housing. Sometimes it's going to be teachers and students and such, and other times it's going to be cronies of politicians.

    So that's not a surprise at all, what the study is finding. Again, it's what people warned from the beginning.

    DEVARIEUX: Always good to see you, Bill. Thanks for being on.

    BLACK: Thank you.

    DEVARIEUX: 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


    Thousands #FloodWallStreet to Target Institutions Profiting from Climate Change
    Re-energizing the Electrical Grid
    Do We Need a War on U.S. Military Carbon Emissions?
    World Leaders to Emit Promises of Hot Air at UN Climate Summit
    Voices from the Historic 300,000+ Strong 'People's Climate March'
    Most Members of the Black Caucus Have Supported Police Militarization
    The Climate Crisis: Which Way Out?
    War, Whistleblowing and Independent Journalism Panel
    It's Time to Act on the Climate Crisis
    Breaking Down the Scottish Independence Vote by Class Lines
    Progressive Caucus Split on Issue of Arming Syrian Rebels
    Historic Climate Change Protests Only Days Away
    Philadelphia Decriminalizes Marijuana
    Coalition to Fight the Islamic State Unlikely to Succeed
    Upsurge in Voter Participation and Scare-Campaigns As Scots Head To The Polls
    Are Combat Troops on Their Way to Iraq?
    Media Failing to Provide Substantive Debate on ISIS
    Interpret or Change the World?
    Special Report: Scots in Their Own Words on Independence
    What Drives U.S. Foreign Policy Towards Israel?
    The Federal Reserve Makes "Effort" to Rein in Big Banks
    An American Fascism - Eddie Conway on Reality Asserts Itself (5/8)
    Breakthroughs Unlikely at Upcoming UN Climate Summit
    The Untold History of The Star Spangled Banner
    What Drives Obama's Foreign Policy?
    Israel Facing Major Economic Consequences for 50 Day War on Gaza
    FBI Targets Minority Communities in Mortgage Fraud Investigations
    Obama's 'Moderate' Syrian Rebels Are Nowhere to Be Found
    "The State Targeted the Panthers Because We Were Socialists, Not Because We Were Armed" - Eddie Conway on Reality Asserts Itself (4/8)
    Democrats Have Options to Pursue Campaign Finance Reform

    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