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


  • 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 Facebook Share to Twitter



    The Real News is a vital answer to The New York Times, the house organ of the oligarchs. - Al Salzman
    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


    Maryland Police Reform Advocates and Opponents Speak Out Prior to Hearing
    Venezuelan Gov. Releases Audio of Coup Plotters
    The Greek Debt and the German acquiescence
    Baltimore College Fights To Keep Accreditation Status
    Irish Style Banking Inquiry into the 2008 Financial Crisis
    What Role Can Social Media Play Supporting Protests Against Egypt's Military Regime?
    Greece Now Positioned to Negotiate a New Loan Agreement
    Netanyahu on a Destructive Path
    Chicago Mayor Emmanuel Forced Into Historic Runoff
    Guardian UK Exposes Horrific Abuses at Police 'Black Sites'
    Greek Reform Proposal Preserves Privatization Commitments, Ignores Debt Restructuring
    The Modern History of the Greek Debt Crisis
    Iran's Intent is the Real Issue, Says Former IAEA Inspector
    Bill O'Reilly May Have Covered-Up a Massacre
    How Radical is the SYRIZA Party in Greece? (2/2)
    Leaked RCMP Report Targets Activists as a Threat to National Security
    European Banks vs. Greek Labour
    What Happened to Making Steel in Baltimore? - Mark Reutter on Reality Asserts Itself (2/3)
    Black, Brown and Woman: Afro-Latinas and Legacies of Imperialism
    Capitalism's War on Democracy
    What Was Missing from Obama's Anti-Terrorism Speech
    Prejudicial Trial, Prejudicial Verdict: $218 Million
    Iceland's Supreme Court Upholds Jail Sentences of Four Banking Executives
    What Happened to Making Steel in Baltimore? - Mark Reutter on Reality Asserts Itself (1/3)
    Will Quantitative Easing Solve the European Economic Crisis?
    Sankofa Dance Theater Marks 25th Anniversary
    TRNN Replay: Wisconsin's Billionaires Make a Sacrifice?
    Malcolm X: The Power Structure is International
    The Rich Hide an Estimated 21 Trillion in Offshore Accounts
    Germany's Collective Denial

    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