Did you hear JP Morgan has offered to pay SS and Vet benefits if the budget scam results in a shutdown? In third world countries the 1% have a motto: keep the poor barely living and they will not revolt. We know that JP Morgan alone owes the American people trillions of dollars in fraud.....energy manipulation fraud....transaction rate manipulation fraud.....LIBOR fraud......subprime mortgage fraud. Then there are the profits made with that fraud. JP Morgan alone could be the recovery of corporate fraud that would pay down trillions in national debt. Rather, it is allowed to continue to defraud and offer to be the sugar-daddy to people impoverished by the corporation's bad actions. As we said.....it was Mikulski who heads the Appropriations Committee that funded the FBI white collar criminal agency at one of its lowest rates at a time of record fraud. Citizens groups like mine are trying to help these pols 'see the fraud' so they are not forced to reform public programs for lack of money.
We spoke of finding the cash assets of banks moving tens of trillions to offshore accounts....$35 trillion with the current database download. We spoke of Joe Biden and Delaware and Harry Reid and Nevada as the portal to hiding and secreting corporate wealth out of the country through offshore accounts and protecting wealth from scrutiny through dynasty plans that try to skirt estate tax and wealth tax laws. Lastly, we spoke of the worldwide network of investigators tracking the laundering of fraudulent gains through international real estate investments all totaling tens of trillions of dollars.
WE COULD PAY THE NATIONAL DEBT DOWN IN JUST A FEW YEARS IF THE US ATTORNEY GENERAL/STATE ATTORNEY GENERAL SIMPLY ASKED FOR THE DATA AND FOLLOWED OUR LEAD.
This is the reaction by the 1% to the news that we know where they live.....'it looks like we should close down the International Criminal Court' as it seems investigating and bringing to justice rogue international leaders and thugs may not be in the interest of the 1% any longer'.
Indeed, it is the International Criminal Court (ICC) to which the International Investigative Journalists and International Justice organizations would take these claims against the banks in moving the people's money out of countries to hide in shell accounts. SEE WHY THE ICC IS NO LONGER A POSITIVE ASSET FOR RESOLVING INTERNATIONAL CRIME? The Bush Administration removed the US from the ranks of those countries participating in the ICC joining Israel and the Sudan as the only nations in the world to do so. He did that because he was lying about Weapons of Mass Destruction to start wars, committing torture, private US contractors were openly bribing and committing fraud all around the world, and THE US BANKS HAD A MASSIVE FINANCIAL FRAUD OPERATING ALL AROUND THE WORLD. These are pretty good reasons for Bush to take the US out of the ICC. By now everyone knows Obama has done the same for the same reasons and has gone so far as to try to pass domestic laws protecting Bush and himself from any legal responsibility for all of the above.
THIS IS WHY THE HUFFINGTON POST RATED THE OBAMA ADMINISTRATION THE MOST CORRUPT IN US HISTORY WITH BUSH RIGHT BEHIND.
So, you and I are supposed to allow Congress and the President to shutdown government over and over in a fake crisis each time taking billions from public services......negotiate reforms to Entitlements and Social Security because the Trusts have been emptied from fraud....all in order to pay for cuts to corporate tax rates at a time when corporations average 17% tax rate with tax breaks taking that even lower. THIS IS WHAT THE ENTIRE MANUFACTURED CRISES ARE ABOUT. REMEMBER, NEO-LIBERALS AND OBAMA WERE 'FORCED' IN 2010 TO ALLOW BUSH TAX CUTS TO CONTINUE SETTING THE TAX RATE AT ZERO FOR MUCH OF WEALTH AND CORPORATIONS GIVING A TRILLION IN TAX CUTS JUST THAT YEAR. They were forced to do that because of the US START Treaty with Russia that has never been spoken of again.
We simply need to get rid of the neo-liberals and take back the people's democratic party by running and voting for labor and justice in all elections! All of Maryland's democrats are neo-liberals....SHAKE THE BUGS FROM THE RUG!
FBI struggles to handle wave of financial fraud cases
By Eric Lichtblau, David Johnston and Ron Nixon
WASHINGTON — The Federal Bureau of Investigation is struggling to find enough agents and resources to investigate criminal wrongdoing tied to the country's economic crisis, according to current and former bureau officials.
The bureau slashed its criminal investigative work force to expand its national security role after the Sept. 11 attacks, shifting more than 1,800 agents, or nearly one-third of all agents in criminal programs, to terrorism and intelligence duties. Current and former officials say the cutbacks have left the bureau seriously exposed in investigating areas like white-collar crime, which has taken on urgent importance in recent weeks because of the U.S. economic woes.
The pressure on the FBI has recently increased with the disclosure of criminal investigations into some of the largest players in the financial collapse, including Fannie Mae and Freddie Mac. The FBI is planning to double the number of agents working financial crimes by reassigning several hundred agents amid a mood of national alarm. But some people inside and out of the Justice Department wonder where the agents will come from and whether they will be enough.
So depleted are the ranks of the FBI's white-collar investigators that executives in the private sector say they have had difficulty attracting the bureau's attention in cases involving possible frauds of millions of dollars.
Since 2004, FBI officials have warned that mortgage fraud posed a looming threat, and the bureau has repeatedly asked the Bush administration for more money to replenish the ranks of agents handling nonterrorism investigations, according to records and interviews. But each year, the requests have been denied, with no new agents approved for financial crimes, as policy makers focused on counterterrorism.
According to previously undisclosed internal FBI data, the cutbacks have been particularly severe in staffing for investigations into white-collar crimes like mortgage fraud, with a loss of 625 agents, or 36 percent of its 2001 levels.
Over all, the number of criminal cases that the FBI has brought to U.S. prosecutors — including a wide range of crimes like drug trafficking and violent crime — dropped 26 percent in the last seven years, going from 11,029 cases to 8,187, Justice Department data showed.
"Clearly, we have felt the effects of moving resources from criminal investigations to national security," said John Miller, an assistant director at the FBI "In white-collar crime, while we initiated fewer cases over all, we targeted the areas where we could have the biggest impact. We focused on multimillion-dollar corporate fraud, where we could make arrests but also recover money for the fraud victims."
But Justice Department data, which include cases from other agencies, like the Secret Service and Postal Service, illustrate the impact. Prosecutions of frauds against financial institutions dropped 48 percent from 2000 to 2007, insurance fraud cases plummeted 75 percent, and securities fraud cases dropped 17 percent.
Statistics from a research group at Syracuse University in New York State, the Transactional Records Access Clearinghouse, using somewhat different methodology and looking only at the FBI, show an even steeper decline of nearly 50 percent in overall white-collar crime prosecutions in the same period.
In addition to the investigations into Fannie Mae and Freddie Mac, the FBI is carrying out investigations of American International Group and Lehman Brothers, and it has opened more than 1,500 other mortgage-related investigations. Some FBI officials worry privately that the trillion-dollar U.S. bailout of the financial industry may itself become a problem because it contains inadequate controls to deter fraud.
No one has suggested that a quicker response would have averted the mortgage meltdown, but some officials said a faster reaction might have deterred more of the early schemes that seized on loose U.S. lending regulations.
"They were very late to the game," Representative Zoe Lofgren, a California Democrat who has quarreled with the FBI over its financing priorities, said of the bureau's response to the mortgage crisis. "They were not on top of this, and they're just now starting to really do something."
'The FBI’s fiscal year (FY) 2013 budget request totals $8.2 billion in direct budget authority, including 34,083 permanent positions (13,018 special agents, 3,025 intelligence analysts, and 18,040 professional staff). This funding level continues increases provided to the Bureau in the past, most recently in FY 2012, allowing the FBI to maintain its forward progress, including targeting additional resources on investigating financial and mortgage fraud'.
The FBI’s fiscal year (FY) 2014 budget request totals $8.4 billion in direct budget authority, including 34,787 permanent positions (13,082 special agents, 3,026 intelligence analysts, and 18,679 professional staff). This funding level provides critical funding to address threats posed by terrorists, cyber attackers, and criminals.
Robert S. Mueller, III
- Federal Bureau of Investigation
- Statement Before the House Appropriations Committee, Subcommittee on Commerce, Justice, Science, and Related Agencies
- Washington, D.C.
- March 07, 2012
Raise your hand if you understand that $8.4 billion is almost nothing as far as protecting the American people against attack from terrorism, from violent criminals, from every sort of white collar crime. EVERYBODY!!!!!! So, it looks like a staff of about 70,000 people are doing all of this. Raise your hands again if you understand most of that budget is spent on terrorism and crimes against/protection of corporations. EVERYBODY!!!!
Mikulski Chairs Appropriations Hearing on FBI Fiscal Year 2010 Budget
FBI Director Mueller testifies before CJS Appropriations Subcommittee
June 4, 2009
WASHINGTON, DC – U.S. Senator Barbara A. Mikulski (D-Md.), Chairwoman of the Commerce, Justice and Science (CJS) Appropriations Subcommittee, today chaired a hearing on the Federal Bureau of Investigation (FBI) fiscal year 2010 budget. The hearing included testimony from FBI Director Robert Mueller.
Senator Mikulski’s prepared statement follows:
“Good morning and welcome. Today the Commerce, Justice, Science (CJS) Appropriations Subcommittee will hear from Federal Bureau of Investigation (FBI) Director Robert Mueller about the FBI’s budget and priorities for fiscal year 2010.
“First, I want to say that I am proud of the FBI. I am proud of how the men and women serving there fight to protect Americans, dismantle organized crime and drug cartels and combat gang violence that is destroying our neighborhoods. They solve kidnapping and extortion cases and rescue the vulnerable from illicit traffickers. I do not think that Americans don’t fully appreciate the full breadth of what the FBI does to keep America safe.
“After 9/11, the FBI was charged with a new mission. They were still required to carry out their domestic crime fighting role, but an agency within an agency was created to protect us from international terrorism and weapons of mass destruction. The FBI now has two principal jobs: fighting terrorism and fighting crime.
“As Chairwoman of CJS, I want our hearing with the Director to reflect these two huge priorities. We need to truly understand what it takes for FBI to carry out these extraordinary responsibilities. We will begin with an unclassified hearing that will focus primarily on the FBI’s domestic mission. Then, for the first time, we will move to a classified hearing to discuss the FBI’s new mission, much of which cannot be discussed in a public hearing. The CJS Subcommittee will include classified hearings in our annual appropriations process. We will also extend classified hearings to other federal law enforcement agencies when merited. We may even have another classified hearing later this summer to learn about other federal law enforcement needs.
“The President’s budget request for the FBI is $7.9 billion -- a $560 million increase above the 2009 omnibus level, or a 7.7 percent increase. Fortunately, the President’s budget reflects the ongoing needs and priorities of the FBI. This request funds important initiatives like fighting white collar crime and public corruption, protecting the U.S. – Mexico Border from drug traffickers and human smugglings rings, dismantling organized criminal organizations and enterprises and disrupting gangs and recruitment. This budget request includes funding for 12,325 special agents, including 407 new agents, and 2,635 intelligence analysts, including 321 new analysts.”
“The request is $2.4 billion for the FBI’s traditional crime fighting efforts--$133 million above the 2009 omnibus level. This funding will support FBI efforts to fight violent crime and organized criminal enterprises that threaten the safety of our communities and prey on the vulnerable. These criminals are sophisticated and transnational. They smuggle drugs, guns and even people across borders. They do anything to make a profit.
“Criminals are technologically savvy. They use the Internet, BlackBerrys and text messaging to communicate with each other and evade law enforcement. We need sophisticated agents and state of the art technology to track down and investigate these bad guys. The FBI is the premiere law enforcement agency that carries out this important mission. The President’s budget request for criminal activities will fund a total of 4,500 special field agents and 104 intelligence analysts.
“The FBI is playing a major role in protecting the U.S. – Mexico Border, with its Southwest Intelligence Group (SWIG), a clearinghouse of all activities to augment and unify existing FBI efforts with Mexico. It is increasing its focus on public corruption, kidnappings and extortion with a particular focus on Southwest border issues; yet, another major role FBI is playing to fight transnational crime.
“Not only is the FBI fighting violent crime on the border, but it is also fighting financial crimes, like mortgage fraud, which are destroying our communities. The FBI request provides $25 million above the fiscal year 2009 omnibus level of $50 million to hire 50 new agents and 61 new forensic accountants to investigate complex financial investigations. This increase is necessary and timely.
“As of April 2009, the FBI is investigating 2,000 mortgage fraud cases and 40 corporate fraud cases. Mortgage fraud cases are complex and resource intensive. An average mortgage fraud investigation takes one and a half years to complete. A corporate fraud investigation requires almost four years to complete. These financial fraud cases are only growing as the economy struggles. I want to know if your budget keeping up with this pace.
“I want to compliment Senator Shelby for sounding the alarm and working to provide funding for the Adam Walsh Act. The FBI plays an important role in Adam Walsh. The FBI is responsible for monitoring, targeting and arresting Internet predators. Innocent Images in Calverton, Maryland, is the FBI cyber headquarters. The FBI also is responsible for rescuing children who have been forced into prostitution, kidnapped and trafficked into and out of the United States.
“Since 2003, the FBI’s Innocence Lost initiative has developed 24 task forces in the U.S. that partner with State and local law enforcement to end child prostitution and trafficking. Efforts have resulted in over 575 children rescued and the conviction of more than 300 pimps, madams and their associates who exploit children through prostitution. Yet there is no additional funding for these important programs that have saved children’s lives. These two programs continue to be flat funded. I want to hear from you today about what resources you need to keep kids safe.
“Our nation faces a growing and pervasive threat from hackers, cyber spies and cyber terrorists. Cyber security is a critical component to our nation’s infrastructure. We need safe and resilient networks to protect our online banking, online commerce, electrical and power grids, air traffic control systems and digitalized records. The FBI is bringing to justice cyber hackers, cyber spies and cyber terrorists who operate in anonymity and with predatory intent towards the United States.
“Last year, we appropriated $75 million for the FBI’s cyber security efforts. This year, the request is $140 million -- a $65 million increase to add 107 agents, 42 intelligence analysts and 111 professional staff. We will hear more about the details on the FBI’s cyber security efforts in the classified session, but I am pleased that the FBI is a key component in guarding our nation’s cyber security.
“Finally, most increases in the FBI’s budget request are for the FBI’s counterterrorism and intelligence activities. We all agree this is a top priority. For counterterrorism, the budget proposes $3.13 billion; a $257 million increase above the 2009 omnibus level. Counterterrorism is over 40 percent of the FBI’s budget. For intelligence, the budget proposes an increase of $1.64 billion, or $154 million a 10 percent increase above the 2009 omnibus level.
“Given all of the FBI’s important roles and responsibilities, we must ensure that it has the resources needed to protect the lives of 300 million Americans. I would like to say it is a personal privilege to thank Director Mueller and the FBI for the leadership on effective interrogation methods that follow the rule of law, but also make sure we get the information we need to protect the American people. You provide advice and guidance on what are effective and legal interrogation techniques. We will leave it up to the Judiciary Committee to further investigate the previous Administration’s approach. Today, I just want to thank you for your leadership.”
As you see here the International Criminal Court has been less effective than it could be because of budget funding far lower than needed to do its job. It has proven to be a valuable resource in providing a venue for criminal actions across international borders and would be used to recover this Visigoth looting of national Treasuries around the world.
It appears that the ICC sees these kinds of tasks in its future but as this article shows the nations charged with funding it are the very nations guilty of these massive frauds. It will be critical to get funding from perhaps the BRIC nations.....those growing economies that are no less criminal but often victims of the Visigoth fraud none the less.
Dispatches: Big Budget Ask is Sign of Fresh Thinking at ICC
August 5, 2013 Elizabeth Evenson
2011 Reuters Limited
The ICC released an advance version of its budget request for 2014 last week. The Office of the Prosecutor – whose new prosecutor started in June 2012 – said the funding would be used, in part, to grow the size of its investigation teams and invest in new technologies.
The request will be debated by the ICC’s 122 member countries, who foot the bill for the court, and the budget will be finalized in November.
Given that the court’s big payers – like Germany and Japan – have in the past insisted that the court hold down growth altogether, it remains to be seen how states will react. In a separate report, the court, which overall is seeking a 9.5 percent increase in funding, has warned that if it doesn’t get more resources in 2014, it will be forced to shut down the equivalent of activities in two or three countries.
It’s the thinking behind the prosecution’s request that may matter as much as the figures.
According to the document, the office has concluded that its model of rotating small teams of investigators between cases is not effective in digging up the evidence judges want. This comes on the back of recent setbacks, including an acquittal last December in only the second ICC case to reach a verdict.
In the past we raised concerns that the office simply didn’t have the staff it needed to conduct investigations.
The office’s task is – to put it mildly – daunting, and resources are certainly not the only issue. But the office’s candid assessment that change is needed is perhaps the biggest sign yet of its new leadership.
As I described earlier, this massive corporate fraud of tens of trillions was orchestrated....it was not only excessive greed. The goal was to move all wealth from low/middle income people to the top earners and that is what we have today. So, at the same time this fraud was picking up steam Bush found a reason to dismantle most of the criminal agencies charged with oversight of white collar fraud. Remember, it was Reagan and Clinton who set the stage for these global connections allowing money to be laundered out of the country and into hiding. That was what bank deregulation and free trade did as banks went global.
Obama was elected with a supermajority because he ran on holding corporations accountable and then he did the opposite, working to make sure the fraud stayed where it was.
WHEN A GOVERNMENT SUSPENDS RULE OF LAW IT SUSPENDS STATUTES OF LIMITATIONS.
FBI Eases Up on White Collar Crime
Back to News inShare Tuesday, October 01, 2013 (graphic: stateofsearch.com)
The Federal Bureau of Investigation (FBI) used to be the go-to federal law enforcement agency for cracking down on white-collar crime. But both recent and historical data reveals that the FBI is pursuing far fewer of these cases.
The Transactional Records Access Clearinghouse (TRAC), a nonpartisan government watchdog located at Syracuse University, found that FBI white-collar crime cases recommended for prosecution are down significantly so far this year, based on government records obtained from the U.S. Department of Justice.
If the FBI maintains its pace for the remainder of 2013, the bureau’s total will be down nearly 7% from the previous year, TRAC concluded.
More importantly, the rate that the FBI pursues white-collar crimes could be down as much as 45% compared to totals from 2003—and nearly 59% from 1993.
TRAC attributed the decline to the FBI’s decision following the September 11, 2001, attacks to devote more resources and manpower to combating international and domestic terrorism and weapons of mass destruction.
To date, the FBI has sent 2,001 white-collar cases to the Justice Department for prosecution this year. The vast majority of these investigations have dealt with fraud, particularly those involving financial institutions, mortgages and health care.
Justice Dept. Mistakes Slapping Wall Street Wrists for True Punishment for Fraud
Monday, February 25, 2013 (graphic: stateofsearch.com)
Stung by criticism that it has given Wall Street a “Get out of Jail Free Card” despite its role in causing the 2008 financial crisis and subsequent Great Recession, the Justice Department (DOJ) is talking tough about what it calls a new model for going after Wall Street fraudsters. Instead of settling for consent agreements and fines, DOJ claims it is now insisting on actual guilty pleas to felony charges. But critics remain skeptical, particularly because there is no indication that corporate executives will be held responsible for the crimes committed by the businesses they run. Matt Taibbi of Rolling Stone called the new model “beyond laughable.”
The new approach, which surfaced in recent settlements with UBS and the Royal Bank of Scotland for their roles in the LIBOR rate-fixing fraud, involved demanding that their Japanese subsidiaries plead guilty to felony wire fraud. Now, prosecutors are said to be setting their sights on the Japanese subsidiaries of Citigroup, Deutsche Bank and JPMorgan Chase.
“This Department of Justice will continue to hold financial institutions that break the law criminally responsible,” claimed Lanny A. Breuer, head of DOJ’s criminal division.
Critics retort, however, that none of the corporate parent companies involved in LIBOR pleaded guilty, nor did any of their executives. Even the impact on the Japanese units was softened, as Japanese authorities assured UBS that they would not de-license its subsidiary. While the plea has depressed its stock price, the subsidiary is operating normally and clients remain.
“Extracting a guilty plea from a wholly-owned subsidiary finally enables the Justice Department to look tough on financial institutions while sparing them from the corporate death penalty,” observed Evan T. Barr, an ex-prosecutor who now defends white-collar criminal cases at the law firm Steptoe & Johnson.
Barr’s reference to the corporate death penalty is telling, because the claim that job losses would follow strict enforcement of the law is one that DOJ officials themselves have cited in defending their lenient approach to Wall Street fraud.
As Taibbi has pointed out however, protecting jobs at fraudster firms may seem like a good idea in the short run, but “the long-term job losses are going to be much greater when investors around the world lose confidence in the U.S. financial system because they recognize that individuals do not face punishment for criminal activity.”
This type of what economists call “moral hazard,” arises when an individual has no incentive to obey the law because he or she faces no risk of punishment, while others will actually bear the consequences of the law-breaking. That is what happened in 2008, and even under the DOJ’s new strategy, “the individual incentive not to commit crime on Wall Street now is almost zero.”
Mueller: I Crippled FBI Effort v. White-Collar Crime, My Successor Will Make it Worse
Posted on August 26, 2013 by Devin Smith By William K. Black
(Cross posted at Benzinga.com)
FBI Director Robert Mueller is taking his victory lap as he steps down after 12 years of service. I have done three articles in a series that explains how the Mortgage Bankers Association (MBA) conned the FBI into adopting the Tea Party’s mythology about the causes of the crisis – virginal banks beset by ultra-sophisticated fraudulent hairdressers. The MBA created a faux definition of mortgage fraud under which the bank and its senior officers were always the victims instead of the perpetrators.
Mueller’s description of his tenure reveals that his obsession with one of the FBI’s tasks, anti-terrorism caused the FBI to fail catastrophically in many other tasks. The FBI is essential in a wide range of fields. We have, for example, roughly one million Americans employed in our criminal justice system. Only the 2,300 FBI white-collar specialists, however, investigate elite white-collar crimes and we have over 1,300 industries (not firms). We have over 500 fewer FBI agents working white-collar crime cases because Mueller transferred over 500 of them to national security tasks after 9/11. (Mueller sought to move the best 500-800 of those white-collar agents by permanently or temporarily reassigning them to national security, so the true loss of capacity against sophisticated financial frauds was far greater than the bare numbers suggest.) We can all understand that action, which was part of a transfer of over 2,000 FBI agents to national security that Mueller ordered in response to 9/11.
Senior FBI officials sought to replace the lost agents, but the Bush administration refused to allow the FBI the right to do so and Mueller never went to the mat to replace the loss of agents in fields other than national security because his focus was almost exclusively on national security.
“Robert Mueller, the FBI’s director since 2001, said mortgage fraud needed to be considered ‘in context of other priorities,’ such as terrorism. He told the Commission that he hired additional resources to fight fraud, but that ‘we didn’t get what we had requested’ during the budget process. He also said that the FBI allocated additional resources to reflect the growth in mortgage fraud, but acknowledged that those resources may have been insufficient. ‘I am not going to tell you that that is adequate for what is out there,” he said. In the wake of the crisis, the FBI is continuing to investigate fraud, and Mueller suggested that some prosecutions may be still to come’” (FCIC 2011: 163).
“Some prosecutions may be still to come” – what a forlorn hope. Since he uttered the forlorn hope there have been zero prosecutions of the senior officers of the control frauds that caused the crisis. “Terrorism” cannot be accepted as an excuse for failing in the FBI’s responsibilities, yet Mueller remains blind to the costs to the Nation of the FBI’s mono-focus on national security.
“‘I had been a prosecutor before, so I anticipated spending time on public corruption cases and narcotics cases and bank robberies and the like, and Sept. 11 changed all of that,’ he says.
It took him a while to realize how drastically the mission of the FBI had to change. Conversations with President George W. Bush and later with President Obama focused his mind on this thought: ‘What is the FBI doing to prevent the next terrorist attack?’”
Mueller’s comment reveals the critical error that caused the FBI to fail. The “mission” of the FBI did not need to “change” in response to 9/11. The FBI had always had the mission of preventing domestic terrorist attacks. The 9/11 attacks should not have led to Mueller not “spending time” on the FBI’s other functions. Mueller “drastically” redefined his mission as national security – period. That cannot work when one runs an agency that is the only means of detecting, investigating, prosecuting, and deterring a vast range of dangerous crimes. Mueller “locked-on” on a single “target” and lost broader “situational awareness.”
The obvious point, except to Mueller (and the media) was “what is the FBI doing to prevent the rapidly growing epidemics of mortgage origination and secondary market control frauds that are going to cause the worst financial and economic crisis in 75 years?” The NPR program accepted uncritically the claim that Mueller had transformed the agency in a positive manner.
“And in a huge shift in mindset, he also set up an intelligence operation within the bureau to analyze threats.”
The FBI must prevent threats of fraud epidemics that cause over $12 trillion in losses in wealth and cost over 10 million American jobs. Where was the “intelligence operation” that missed?
- The appraisers’ warnings – which began in 2000 – that the lenders were engaged in endemic appraisal fraud in order to inflate appraisals,
- Our driving liar’s loans out of the S&L industry in 1990-1991 because we recognized that only fraudulent lenders would regularly make liar’s loans,
- The FBI’s own twin warnings in September 2004 that there was an epidemic of mortgage fraud and that it would cause a financial crisis were it not successfully contained – warnings that Mueller failed to heed
- The lending industry’s own anti-fraud expert’s five warnings about the endemically fraudulent nature of “liar’s” loans in early 2006,
- The fact that the industry called the loans “liar’s” loans behind closed doors.
“Former Justice Department Inspector General Glenn Fine, who frequently held Mueller’s feet to the fire, says it has been a successful run for the director.
‘The measure of a tenure and the measure of a leader is whether when he learns of those problems, he fixes them,’ says Fine….”
Mueller did not fix the problems. He dealt with only one set of problems, as did Fine after 9/11.
Mueller shows no recognition that he has created institutions that have reinforced his worst tendency to focus solely on terrorism.
“For nearly a dozen years now, Mueller has started his morning — every morning — with a secret threat briefing. So, what keeps him up at night?
‘Well, the thing I worry about most … is the possibility of a bomb on an airplane, here in this day and age,’ he says.”
The reporters never ask him how many times that morning “secret threat briefing” warned him about the control fraud epidemics. Mueller’s saw banks only as the potential victims of terror.
“Lately, Mueller has been focusing his energy on a new area of work for the FBI: cyberattacks on banks, utilities and other ‘vulnerable’ areas. And in another pivot point for his agency, Mueller worries that the cyberthreat will soon overtake al-Qaida as the bureau’s biggest priority.
‘Before we have a substantial incident which would serve as a wake-up call, we need to do everything we can to prevent that happening,’ he says.
Mueller’s rare consideration of banks is doubly revealing. First, notice that he ignores the lead role that bank control frauds play in assisting terror – particularly potential state-sponsored terror. The HSBC and Standard Chartered cases – real cases of the world’s largest banks deliberately aiding the funding terror groups and Iran’s pursuit of nuclear weapons (controversial, I know, but Mueller certainly believes it). Second, Mueller ignores these real cases and worries solely about hypothetical cases where the banks might be the victims. That hypothetical leads Mueller to declare that “we need to do everything we can to prevent that happening.” But we apparently do not have to “do everything we can to prevent” the real actions by fraudulent banks (among the largest in the world) to aid terrorists in order to increase bank profits and their officers’ bonuses. DOJ refused to prosecute HSBC and Standard Chartered and the hundreds of employees who committed tens of thousands of frauds for over a decade.
The 9/11 attacks caused a terrible loss of life, but the FBI’s duty is to prevent crimes (including white-collar crimes) that kill and maim far more people than do terrorist attacks. An FBI leader must not focus on the politically sensitive cases and must counter the hysteria and grossly exaggerated fear that terrorism seeks to create. Mueller was terrorized by terror.
Mueller portrays his mono-focus on national security as a virtue and impugns those who focus on all crimes or cared about constitutional rights as deficient in their humanity.
“As a prosecutor, he worked for years on the investigation of the bombing of Pan Am 103 over Lockerbie, Scotland, in 1988.
To ‘people who [criticize] our intelligence programs…I would say: Spend a few moments with families of those who have lost their loved ones, whether it be Pan Am 103 or Sept. 11 … and it puts it in a wee bit different context.’”
Every family member who loses a loved one suffers. Only a tiny percentage of family members suffer that loss due to a crime are the collateral victims of terrorists. It is clear that the Pan Am experience is the defining trauma of Mueller’s life. Had he been the prosecutor in Bangladesh of the white-collar criminal who owned the clothing plant that collapsed and murdered thousands of workers Mueller might have become the scourge of control frauds. One hopes, however, that in that alternative incarnation he would not have become so cavalier about harming constitutional rights in the pursuit of the control frauds. The suffering of families who lose loved ones due to crimes does not put the constitution “in a wee bit different context.” “
Mueller has never met most of the victims of our insane drug wars. As with other attempts at prohibition it creates criminogenic environments that cause the deaths of tens of thousands of people. Most of the families of these victims live in other nations. The drug war also funds many terrorists so it is doubly stupid. Ending the drug wars would free up investigators and to make the FBI more effective in every field (including anti-terror). An FBI Director focused solely on terror cannot bring the strategic thinking essential to making these vital changes.
Mueller also explained that politics will exacerbate the FBI’s failure to hold elite bankers accountable for the frauds that drove crisis. Mueller stated as an obvious fact that no FBI leader will cut the agents assigned to terror, so the sequester cuts will fall entirely on other programs.
“Over the past few months, something else has been on the mind of the FBI director, a problem he’s leaving for his successor: the budget crisis.
Mueller says there’s only so much the bureau can cut back on cars and travel and information technology upgrades. Furloughs for 2014, he says, are on the way. So is a tough conversation about priorities.
‘I expect the special agent in charge to make certain that there is no Mohamed Atta, terrorist, swimming in the waters in that division,’ Mueller says. ‘So what’s going to be hit is white-collar crime. What’s going to be hit is violent crime — we’re not going to be able to do as much as we’d want there. Organized crime.’”
This is significantly insane. Why haven’t Mueller, Holder, and Obama been raging every day to the media about how irresponsible Republicans are to give a free pass to violent criminals, organized criminals, and elite white-collar criminals? If the Democrats gutted the FBI the Republicans would be denouncing them every hour as traitors endangering the Nation and serving the interests of murderers, mob bosses, and criminal bank CEOs. It is also insane that our counter-productive, unconstitutional, and immoral anti-terror programs are sacrosanct from budget cuts while the already understaffed FBI functions will be slashed again due to the (non-existent) “budget crisis.” First on the Mueller’s list for further cuts: “white-collar crime.”
White-collar crime investigations and prosecutions are massive money makers that reduce the deficit, but Mueller, Holder, and Obama refuse to make these points and refuse to prosecute the elite bank fraudsters. On substantive and political grounds their actions are either inexplicable or all too explicable and support my readers’ belief that the FBI leadership no longer wants to investigate and prosecute the elite bank frauds.
Bill Black is the author of The Best Way to Rob a Bank is to Own One and an associate professor of economics and law at the University of Missouri-Kansas City. He spent years working on regulatory policy and fraud prevention as Executive Director of the Institute for Fraud Prevention, Litigation Director of the Federal Home Loan Bank Board and Deputy Director of the National Commission on Financial Institution Reform, Recovery and Enforcement, among other positions.