Busted: Bankers and The Global Economy

February 22, 2010

Bank of America Fined

Filed under: banking, economy — Tags: , , , , , , , — digitaleconomy @ 10:47 am

A federal judge has reluctantly approved a $150 million settlement with the Securities and Exchange Commission stemming from the bank’s merger with investment firm Merrill Lynch at the height of the financial crisis. In the months before the deal closed, Bank of America failed to disclose that hefty bonus payouts or the mounting losses that eventually led to a second government bailout of $20 billion for Bank of America.

The New York judge admitted that the fine is a slap on the wrist, but was the second settlement that the SEC had cobbled together that he felt was reasonable. While Bank of America had failed to adequately disclose the bonuses and the losses, the judge agreed that circumstances were unclear, uncertain as whether the lack of disclosure resulted from negligence or fraudulent intent.

November 7, 2009

Wall Street Justice Obama Style

corrupt bankers prisonOver and over again, Americans see the same debacle unroll before their eyes, that is, if they are paying any attention. Earlier this year, billions in bonuses were paid to Merrill Lynch executives as the firm was failing. An agreement was made that Bank of America would pick up the pieces of Merrill Lynch with the support of the American taxpayer and later, BofA was bailed out as well. After a dance with the SEC, no wrongdoing was admitted.

After an investigation by the Securities and Exchange Commission, Banking wunderkind JPMorgan agreed to a $722 million settlement. Why? It all rises from a risky derivatives deal that drove Alabama politics to the brink of bankruptcy. As part of the settlement, JPMorgan neither admitted nor denied wrongdoing despite overwhelming evidence that the financial group did actually engage in acute wrongdoing.

What passes for justice on Wall Street? Regulators give a banking institution that they back a fine that taps the corporate bottom line for wrongdoing. The banks are eager to quickly forget the whole thing by paying a modest fine and getting on with business as usual. There is no admission to wrongdoing and business continues. The government gets a fine to pad their already overbloated budgets that the American taxpayer is already floating. We must be stupid because we keep doing the same thing over and over.

No one admits to corruption, much less to making a mistake. Meanwhile, nobody pays back the taxpayer, much less actually pays off a debt of any kind.  Reality is a round robin of funny money, usury and blatant dishonesty. Where is the outrage? Nowhere, because we are too wrapped in our small lives and/or afraid of reprisals or perhaps the boogeyman. Perhaps by our collective refusal to stand up against politicians and bankers, we are admitting that any American would do exactly the same thing; that not one American is any better. What do you say? Probably very little.

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