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Thread: Fraud, Money Laundering and Narcotics. Impunity of the Banking Giants. No Prosecution

  1. #1

    Fraud, Money Laundering and Narcotics. Impunity of the Banking Giants. No Prosecution

    In another shameful decision by the US Department of Justice, earlier this month federal prosecutors reached a deferred prosecution agreement (DPA) with UK banking giant HSBC, Europe’s largest bank.Shameful perhaps, but entirely predictable. After all, in an era characterized by economic collapse owing to gross criminality by leading financial actors, policy decisions and the legal environment framing those decisions have been shaped by oligarchs who quite literally have “captured” the state.
    Founded in 1865 by flush-with-cash opium merchants after the British Crown seized Hong Kong from China in the aftermath of the First Opium War, HSBC has been a permanent fixture on the radar of US law enforcement and regulatory agencies for more than a decade.


    Not that anything so trifling as terrorist financing or global narcotrafficking mattered much to the Obama administration.
    As I previously reported, (here, here, here and here), when the Senate Permanent Subcommittee on Investigations issued their mammoth 335-page report, “U.S. Vulnerabilities to Money Laundering, Drugs, and Terrorist Financing: HSBC Case History,” we learned that amongst the “services” offered by HSBC subsidiaries and correspondent banks were sweet deals, to the tune of hundreds of billions of dollars, with financial entities with ties to international terrorism and the grisly drug trade.
    Charged with multiple violations of the Bank Secrecy Act for their role in laundering blood money for Mexican and Colombian drug cartels, as a sideline HSBC’s Canary Wharf masters conducted a highly profitable business with the alleged financiers of the 9/11 attacks who washed funds through Saudi Arabia’s Al Rajhi Bank.
    While the media breathlessly reported that the DPA will levy fines totaling some $1.92 billion (£1.2bn) which includes $655 million (£408m) in civil penalties, the largest penalty of its kind ever levied against a bank, under terms of the agreement not a single senior officer will be criminally charged. In fact, those fines will be paid by shareholders which include municipal investors, pension funds and the public at large.
    With some 7,200 offices in more than 80 countries and 2011 profits topping $22 billion (£13.6bn), Senate investigators found that HSBC’s web of 1,200 correspondent banks provided drug traffickers, other organized crime groups and terrorists with “U.S. dollar services, including services to move funds, exchange currencies, cash monetary instruments, and carry out other financial transactions. Correspondent banking can become a major conduit for illicit money flows unless U.S. laws to prevent money laundering are followed.” They weren’t and as a result the bank’s balance sheets were inflated with illicit proceeds from terrorists and drug gangsters.
    Revelations of widespread institutional criminality are hardly a recent phenomenon. More than a decade ago journalist Stephen Bender published a Z Magazine piece which found that “99.9 percent of the laundered criminal money that is presented for deposit in the United States gets comfortably into secure accounts.”
    According to Bender: “The key institution in the enabling of money laundering is the ‘private bank,’ a subdivision of every major US financial institution. Private banks exclusively seek out a wealthy clientele, the threshold often being an annual income in excess of $1 million. With the prerogatives of wealth comes a certain regulatory deference.”
    Such “regulatory deference” in the era of “too big to fail” and its corollary, “too big to prosecute,” is a signal characteristic as noted above, of state capture by criminal financial elites.
    Fraud, Money Laundering and Narcotics. Impunity of the Banking Giants. No Prosecution of HSBC | Global Research

    Bigger it is and more they are getting away from prosecution...

  2. I think they are just deferring the payment a little but both this one and the Transocean settlement are the largest in US history and speaks volumes about how this administration differs from previous administrations in that they are actually successfully fining large corporations.
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  3. #3
    Quote Originally Posted by dvduval View Post
    I think they are just deferring the payment a little but both this one and the Transocean settlement are the largest in US history and speaks volumes about how this administration differs from previous administrations in that they are actually successfully fining large corporations.
    Except this one is purely criminal. Fine the big fishes and put the little fish in jail, seems to me that the laws are not for everyone...

  4. #4
    What speaks volumes about the Obama administration versus previous administrations is their contempt for corporations and large businesses as well as people who are major investors and employers. It is all part of their socialist agenda.

    If they were really serious about doing something about bank crimes they would lock up the people guilty of the criminal acts. Fining banks and corporations does not personally affect the criminals. If they locked a few of the decision makers up, that would deter others.

    This is very similar to the 'blame the gun for the crime' ignorant mentality that we are currently seeing from this administration. A corporation does not engage in any criminal acts. The people in charge do.
    "Democracy is two wolves and a lamb voting on what to have for lunch. Liberty is a well-armed lamb contesting the vote." -- Benjamin Franklin


  5. #5
    Quote Originally Posted by dvduval View Post
    I think they are just deferring the payment a little but both this one and the Transocean settlement are the largest in US history and speaks volumes about how this administration differs from previous administrations in that they are actually successfully fining large corporations.

    Fining corporations is nothing new.

    SEC has collected $324 million in Enron fines - seattlepi.com
    Citigroup, Morgan Chase fined for Enron deals: corruption at the heights of American finance - World Socialist Web Site

    The difference between Obama and Bush is that Ken Lay faced prison time for Enron. Under Bush, the USA dropped from 16th on the International Corruption Perceptions index to 18th. Under Obama, we dropped from 18th to 24th.

    2011 Corruption Perceptions Index -- Results

  6. #6
    It wasn't just Ken Lay and other Enron execs who were prosecuted. There were quite likely thousands of CEOs, CFOs and others who were aggressively prosecuted under Bush. People never heard about it because Bush did not grandstand the issue and the press never covered it. Under Bush and after Enron, there was a "no mecy' policy for white collar crime.

    I personally knew of about a hundred former execs who were imprisoned at Eglin Air Force base in Florida. They were all sentenced to hard labor and were used as work crews to clean up the jet fighter target ranges.

    I visited a guy that I used to work for while he was doing a 2-year stretch at Eglin. His crime: tax evasion because he personally utilized some of the company's Caterpillar tractor equipment on his farm without compensating the company. The equipment was used for snow removal in the winter, but normally sat idle in the summer, so he moved it to his farm in the summer and used it. He owned a private company, but what he did was a technical violation of the tax laws. If he had simply wrote a $1 per month lease and paid it to the company he could not have been prosecuted. But someone reported him and the Federal prosecutors went after him. As far-fetched as that sounds, there were at least a hundred other former execs in Eglin when I was there to visit the guy. Almost all were in the 50s and 60s. I have no idea how many were imprisoned on other military bases.

    I don't blame this on Clinton, but what drove the level of white collar crime by executives (including Enron) was the almost total lack of prosecution under Clinton. There needs to be a balance and the Feds should go after the real criminals, not the corporations. Going after the corporations is just another way to extract money, which is very likely Obama's real goal. It does almost nothing to stop criminals.

    When dealing with Obama, nothing will ever be as it appears. Watch what he does, not what he says. They are almost never the same. I grew up in Chicago and that was the status quo for politics and still is today. The real activity is always "under the table."
    "Democracy is two wolves and a lamb voting on what to have for lunch. Liberty is a well-armed lamb contesting the vote." -- Benjamin Franklin


  7. #7
    Just two words will tell you all you need about obama, holder and the entire regime:

    Jon Corzine

  8. #8
    Quote Originally Posted by iowadawg View Post
    Just two words will tell you all you need about obama, holder and the entire regime:

    Jon Corzine
    Nonsense. It was only a Billion dollars, or as the president says, chump change. Besides, he was a major Obama bundler. That has to count for something, right?

    Granted, Ken Lay was connected to the Bush White House via Enron, but in the case of Bush, that connection only served to create article after article after article in the NY Times talking about Bush's connection to the fraudster. If one looks in the NY Times for articles about Jon Corzine, you'll notice they are completely devoid of any mention of Obama. Maybe if Obama had issued an executive order creating a task force to pursue MF Global, like Bush did for Enron, perhaps then the media would have taken note of the very direct financial relationship between Corzine and Obama? Or is it the absence of such an investigation that bears reporting, I get it confused.

    One thing seems pretty clear. If the fine folks of the press don't care, neither does anyone else. I thought this article summed it up nicely.


    From all accounts Corzine was a very hands-on manager. He relentlessly walked the trading floor and was chief architect for all the sovereign debt positions. He is an expert on the asset class; he used to trade sovereigns back in his Goldman days. Consequently, because of the extreme leverage employed even small moves in interest rates could mean big margin calls. Any person with any attention to detail would be constantly monitoring all trades and calculating exactly what margin may be due and where the money to fund them was going to come from. Corzine did not get to be head of Goldman Sachs, a senator and governor of New Jersey without being an very bright, attention to detail oriented person. Anytime a big margin call came in, who do you think was notified first? Ultimately whose decision was it as to where the money to meet the call was going to come from? It’s perplexing why can’t regulators trace over a billion dollars in wire transfers? “Judicial Watch” got so tired of asking they have filed suit under the FOIA requesting all documents relating to missing customer funds. Trustee Giddens is so angry about desultory regulators; he vows to seek state venues for criminal action. So unless Mr. Corzine received some unclosed head blow which resulted in a rapid cognitive decline, the odds are, to me, thin indeed that he remained ignorant of MF Global machinations.

    Jon Corzine: Criminal Or Just Plain Old-Fashioned Stupid? - Forbes

  9. #9
    It doesn't take a rocket scientist to figure out there Jon Corzine's missing $billion went. Someone has to finance fraudulent elections and corruption in government. The crooks are running out of taxpayer money, so they have to scrape by with a $billion here and a $billion there.
    "Democracy is two wolves and a lamb voting on what to have for lunch. Liberty is a well-armed lamb contesting the vote." -- Benjamin Franklin


  10. #10
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    Obama gets most of his campaign contributions from Hedge Funds, Hollywood, and Public Sector Unions. It the same story, the middle class gets squeezed, the poor get government cheese and the big guys like Al Gore and Warren Buffet beg the government to raise their 'tax rates' while at the same time using tax deductions to pay lower rates than their secretary.

    The recent fiscal cliff deal gave Hollywood a $78 million tax break and banks, insurance companies and other financial firms can shield foreign profits from being taxed by the U.S. The tax break is important to major multinational banks and financial firms. Cost: $11.2 billion.

    Read more: Fiscal Cliff Deal Packed with Breaks for Business

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