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April 29th, 2014

4/29/2014

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The SEC allowed US banks to leave GAAP accounting principles for an International Accounting Principles that place the protections on shareholder wealth and not the public.  As you see below, so many accounting frauds are happening now.  Accounting is a dry subject but it is behind all of the loss of control in fraud and corruption.  Please take time to glance through these postings, especially the last one!

DO YOU HEAR YOUR POL SHOUTING THAT OBAMA AND NEO-LIBERALS ARE DISMANTLING ACCOUNTING REGULATIONS JUST AS CLINTON DEMANTLED BANK REGULATIONS MAKING IT HARDER FOR THE PUBLIC TO CONVICT IN ACCOUNTING FRAUD?


I want to take a few days to look at the state of US banks several years after the massive frauds were discovered and brought down the US economy.  Bank of America and Citibank were to too largest pushers and processors of subprime mortgage loans and Citibank's CEO Robert Rubin was of course Bill Clinton's finance chief when all of the bank deregulation and breaking of Glass Steagall occurred.  It is reasonable to assume the overall plan to blow up the US real estate market was in full swing as Clinton was creating the structures for what is now global Wall Street.  The reason Citi and BOA are of importance is that they are the ZOMBIE banks....the ones that Rule of Law would have required be nationalized and taken into bankruptcy so that all assets could be sent back to creditors and victims of mortgage fraud. 

THIS IS WHAT RULE OF LAW REQUIRED BECAUSE OF THE UNQUESTIONABLE PROOF OF MASSIVE AND SYSTEMIC FRAUD.

That of course did not happen and we have yet to get justice with these two banks.  Mind you, Wells Fargo and the other big banks are equally guilty but CITI and BOA need to go.  Most economists agree that nationalizing these banks to recover fraud would not have had much more of an effect on the economy than the current stagnant and crippled economy we have today.  The second piece to this of which I've spoken earlier is that the movement of US private and public pensions from the then safety of the bond market to the stock market in 2007-2008 was done to buoy these collapsing banks.  Many of US pension money is still attached to the worst of criminal banks.  Rather than bring these banks into bankruptcy and transfer lost pension wealth to worker's, the pensioners are being told the gains of the BULL market these few years has made up the losses----only, it hasn't.

Below you see that yet another illegal game was played at the time of the crash simply to make these banks appear viable.  The idea was pretend they are OK and they can go overseas to amass new profits.  The idea was to allow the FED policy of QE take trillions of dollars of those bad loans off bank accounts to make them look healthier----the FED with $4 trillion in debt has been heard to say they will pass all that debt from fraudulent loans over to the US Treasury-----AKA, THE TAXPAYER.  The FED has reached its limit of debt that can be sustained, the massive transfer of bundled foreclosures has mostly finished (round two of the massive subprime mortgage fraud) so talk moves to reversing the policies that allowed these banks to hide debt and look healthy.


GOODBYE PENSION GAINS FROM THE LAST SEVERAL YEARS----IT WAS ALL FRAUD AND MISREPRESENTATION YET AGAIN.  JUST AS THE WALL STREET RATING AGENCIES GOT OFF SCOTT FREE FOR FRAUDULENTLY GIVING 'AAA' RATINGS TO THESE SUBPRIME LOANS---NOW BANK OF AMERICA AND CITIBANK WILL BE ALLOWED TO REVERSE THE ACCOUNTING TRICKS THAT FALSIFIED THEIR VALUE FOR YEARS AFTER THE CRASH-----ALL INVOLVING FRAUD AND CORRUPTION.


'And how did it err? It says that it properly raised its reported capital levels to offset the reported loss caused by unrealized changes in the valuation of the securities it had issued. But it also raised the capital levels to offset losses that had been realized, something it should not have done. The realized changes came when securities issued by the bank were paid at maturity or repurchased at an earlier date.

That mistake improperly increased its reported capital.

Bank of America did not explain how that the error came to happen or how it was repeated year after year. Nor did it explain why the error was discovered when the first-quarter financial statements for this year were being prepared'.


What all the US big banks did-----BOA and CITI especially ----was to leave the GAAP accounting principles method of recording debt and used an accounting model that allowed it to hide all the subprime mortgage loan and other debt making it look healthier than it was.  You then watch TV commercies toting BOA and CITI as strong and profitable banks as they expanded overseas when in fact they had enormous debt.  Again, these banks were allowed to provide false information to investors to attain business just as happened with the subprime loans.

ALL OF THIS IS FRAUD AND ALL OF THIS PLACES THE PEOPLE'S WEALTH AND INVESTMENTS IN CONSTANT RISK.




Generally Accepted Accounting Principles (United States)

From Wikipedia

Accounting standards have historically been set by the American Institute of Certified Public Accountants (AICPA) subject to Securities and Exchange Commission regulations.[4] The AICPA first created the Committee on Accounting Procedure in 1939, and replaced that with the Accounting Principles Board in 1959. In 1973, the Accounting Principles Board was replaced by the Financial Accounting Standards Board (FASB) under the supervision of the Financial Accounting Foundation with the Financial Accounting Standards Advisory Council serving to advise and provide input on the accounting standards.[5] Other organizations involved in determining United States accounting standards include the Governmental Accounting Standards Board (GASB), formed in 1984, and the Public Company Accounting Oversight Board (PCAOB).

Circa 2008, the FASB issued the FASB Accounting Standards Codification, which reorganized the thousands of US GAAP pronouncements into roughly 90 accounting topics[6]

In 2008, the Securities and Exchange Commission issued a preliminary "roadmap" that may lead the United States to abandon Generally Accepted Accounting Principles in the future (to be determined in 2011), and to join more than 100 countries around the world instead in using the London-based International Financial Reporting Standards.[7] As of 2010, the convergence project was underway with the FASB meeting routinely with the IASB.[8] The SEC expressed their aim to fully adopt International Financial Reporting Standards in the U.S. by 2014.[9] With the convergence of the U.S. GAAP and the international IFRS accounting systems, as the highest authority over International Financial Reporting Standards, the International Accounting Standards Board is becoming more important in the United States.

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Just to show how widespread these accounting frauds were----look below at the systemic nature of these frauds.  Remember, Enron and its collapse resulted by massive frauds by its accounting firm and back then----Rule of Law held Enron and the accounting firm accountable.  That hasn't happened since.

DEREGULATION HAS MADE A WILD WEST OF ALL CORPORATE BEHAVIOR AND THIS HAS OUR ECONOMY AT THIRD WORLD LEVELS OF CORRUPTION.


So, Wall Street banks were allowed to hide massive amounts of debt with accounting tricks and when the FED did the 'STRESS TESTS'  that famously allowed banks to exit government control due to BAILOUT in 2009-2010....it was all a lie.


16 Financial Shenanigans That Got Companies Into Tons Of Trouble

Eric Platt and Lucas Kawa Nov. 20, 2012,

Accounting improprieties, disclosure failures, and outright misrepresentations have gotten companies into trouble since the beginning of business. These are the accusations that Hewlett-Packard has made against software company Autonomy.

As the HP story continues to unfold, we are reminded of some past instances when confusing financial and accounting principles got some big companies on the front page for all of the wrong reasons.

In the recent past, companies have been busted for employing questionable accounting tricks, financial engineering, complicated risk metrics, and outright fraud in an effort to hide losses are inflate profits.


Special Purpose Vehicle (SPV)
Definition: An SPV is a legal entity typically used to serve as a counterparty with the main corporation. In finance it often used for securitization, but it has also been used to hide risky corporate behavior/transactions and conceal corporate relationships.

Case: The most notorious case of special purpose entities being used to distort a company's obligations is Enron, which filed for bankruptcy in 2001. Enron used SPVs to lower the appearance of its debt load and overstate earnings and equity. 

Mark to Market (MTM) AP


Definition: MTM is an accounting measure that values accounts to the current environment. Firms use mark-to-market accounting when the value of an asset or liability moves over time.


Case: Bear Stearns, the now defunct investment bank purchased by JP Morgan, reported in June and July of 2007 that its two main hedge funds (the Bear Stearns High-Grade Structured Credit Fund and High-Grade Structured Credit Enhanced Leveraged Fund) had to mark down nearly all their value, sparking concerns of contagion in the financial crisis. Banks across Wall Street suffered huge paper losses thanks to MTM.


Repo 105
AP Images/ Kristy Wigglesworth

Definition: Repo 105 is an accounting trick that defines a short-term loan as a sale. A company can then use that cash to lower liabilities before paying back the loan with interest. Generally in the repo market, companies will not exchange collateral because the time period is very short.

Case: Lehman Brothers masked extensive liabilities right before quarter-end by using this Repo 105 tactic. The company ultimately filed for bankruptcy and was sold off to different institutions (with most U.S. operations going to Barclays). 

Expense Recognition
ABetterBagofGroceries.com

Definition: Under generally accepted accounting principals, expenses should be recognized when incurred — not necessarily when the payment is made. This is known as the expense recognition principle.

Case: Diamond Foods allegedly shifted payments to walnut growers to later periods to offset costs during its fiscal 2011 year, inflating earnings as it entered negotiations with Proctor & Gamble. The stock transaction depended heavily on Diamond's share price.

Revenue Recognition
haccamopooly/flickr

Definition:  Under  generally accepted accounting principals, revenue should be recognized when the company delivers or performs the task it will be paid for — not necessarily when the payment is received. This is known as the revenue recognition principle. However, exceptions do apply.

Case: Xerox settled with the SEC in 2002 for accelerating revenue recognition of equipment sales by more than $3 billion, which increased pre-tax earnings by $1.5 billion. The company, which was supposed to record revenues both upfront and over a period of time (for servicing equipment over its usable life), moved those service revenues to the time of purchase.

Misrepresented Cash Flows
Definition: The statement of cash flows is the third major financial statement, which tallies cash generated and spent by a company during a fiscal period. This portion of the financial statement of an earnings release is one of the best ways to gauge a company's solvency and actual performance.


Case: WorldCom used its cash flows statement to hide expenses by marking operating costs, which should have been booked as expenses, as capital investments. Under that plan, WorldCom inflated cash flow by $3.8 billion and posted quarters of positive performance when it really lost money.

Channel Stuffing
Krispy Kreme

Definition: Channel stuffing is a practice where a distributor ships retailers excess goods that were not ordered to increase the accounts receivable portion of their balance sheet. Generally, the retailers then ship back the goods and the company must mark them as returns.

Case: Krispy Kreme allegedly sent franchises double their usual shipments at the end of financial quarters so the company could meet Wall Street forecasts. In 2005 the company said it would restate past financial statements.

Hiding Losses in Acquisitions
HK-DMZ on flickr

Definition: Companies can pay high prices for financial advice during a merger, and some have used that guise as a method to cover prior losses. 

Case: Japanese technology giant Olympus announced it had been hiding losses on securities investments for years by using the cover of acquisitions. When new CEO Michael Woodford called attention to strange payments made in 2008, he was subsequently fired.

Round Trip Trading alan5o5 via Flickr

Definition: This is practice where a firm trades an asset and then buys it back many times to inflate its transaction volume. However, the market-manipulation has no impact on profit (although it will bolster top line results).

Case: Dynegy was forced to pay the SEC $3 million after it was found conducting round trip trades with special purpose entities. According to the SEC, Dynegy's "overstatement of its energy-trading activity resulting from 'round-trip' or 'wash' trades — simultaneous, pre-arranged buy-sell trades of energy with the same counter-party, at the same price and volume, and over the same term, resulting in neither profit nor loss to either transacting party."

Smoothing Earnings
Definition: This is a practice where a firm smooths net income by using GAAP techniques to level off fluctuations between periods.


Case: Freddie Mac understated earnings by more than $5 billion over three years to keep earnings consistent and investors happy. According to The New York Times, Freddie Mac lost $111 million during a period it announced net income of nearly $1 billion. Freddie Mac only reported half of what it reported it earned during the third quarter of the year, stating that it earned about $1 billion rather than $2 billion.


Churning
Definition: A practice by brokerage houses where they excessively trade securities to generate commission — even when the trades do not benefit the account holder. Similarly, the practice has been conducted by insurance companies by moving clients from one policy to another.

Case: MetLife, just one of a number of insurance companies found guilty of the practice, settled with state regulators and set aside billions for claims that it moved clients from one policy to another, to generate high premiums.

Bartering
Boonsri Dickinson, Business Insider

Definition: A transaction where two companies (or people) agree to trade goods or services with each other without the use of currency. 

Case: AOL was investigated by the SEC and Justice Department for inflating revenue by using barter trades for online advertising and recognizing the trade as a sale in the period leading up to the merger with Time Warner.

Tax Evasion Philly News

Definition: Pretty simple: an illegal practice where a person or company does not pay the correct tax liabilities owed to the government.

Case: Crazy Eddie, a discount electronics retailer, evaded taxes for years before going public by "skimming and under-reporting income." This was just one of the practices the company used to bolster results. 

Back Dating Employee Stock Options Lara604 / Flickr

Definition: The process where a company offers options to an employee at a date before the actual date the option was made. Companies have done this so they can set better exercise prices to the employee (generally pushing the option into the money).

Case: Apple came under scrutiny for back dating options to employees and forced then-CEO Steve Jobs and other Apple executives to pay $14 million, plus attorney fees. 

Goodwill Impairments
Howard Lake

Definition: Although not illegal, companies have come under pressure from investors for overstating goodwill — which bolsters the balance sheet. Goodwill represents a company's intangible assets (its brand, customer relations, etc.) and often arises during a merger or acquisition.

Case: Green Mountain came under fire for its accounting of goodwill during its acquisition of Van Houtte and how its jump in assets was mainly attributable to that line item on the balance sheet. 

Value at Risk (VAR)
Chris McGrath/Getty Images

A sign on the outside of a Chase bank branch in New York City.

Definition: A tool used by financial institutions that estimates probable losses based on historic trends, prices and volatility. Firms generally report VAR data at quarter-end, with confidence intervals, and for periods stretching from one day to two weeks.

Case: JP Morgan is under intense scrutiny after reporting a $2 billion loss after publishing a VAR of just $76 million a quarter earlier for its entire credit portfolio. At that pace, the entire JP Morgan unit could have lost as much as $76 million in value in any given day (to a 95 percent confidence interval).

_____________________________________________

Remember, these pensions were deliberately thrown into the stock market as it crashed just to buoy these big banks.  This is fraud and public malfeasance on the part of public pensions.  What will double-down on these losses if the fact that all the gains from the stock market these few years are masked by hidden debt----no real gains.

Pension fund managers were part of sending these pensions into a crashing market and as of yet very little justice has come from all these massive pension losses.  Below you see movement by pension funds to recover losses but as of yet-----the same small settlements bring nearly nothing back.  When Bank of America is forced to stop using the accounting methods hiding its debt-----stock values will fall once again.
  This article highlights the ongoing fraud as these foreclosure proceedings were handled as badly.

KEEP IN MIND THIS IS NOW HAPPENING IN THE OBAMA ADMINISTRATION AND A DEMOCRATIC MAJORITY IN THE SENATE AS ARE ALL POLITICIANS ARE SILENT.  CAN YOU IMAGINE IF ALL OF CONGRESS SHOUTED LOUDLY TO GIVE CITIZENS JUSTICE ----- THAT IT WOULD HAPPEN.

This is how we know we have corporate pols running as democrats-----NEO-LIBERALS.

Biggest US Pension Funds Get Into Fraudclosure Fray, Demand Banks "Immediately Examine Foreclosure Practices"

Submitted by Tyler Durden on 01/09/2011 20:13 -0400


  More bad news for the BofA/Wells syndicate. After on Friday two of the biggest mortgage lenders in the world were hit with bad news out of the Massachusetts supreme court, today it is seven of the nation's major pension funds, between them representing nearly half a trillion in capital, which are demanding that "the boards of directors of Bank of America, Citigroup, JP Morgan Chase, and Wells Fargo immediately undertake independent examinations of the banks’ mortgage and foreclosure practices." The coalition of pension funds called for the banks’ Audit Committees to launch independent examinations of their loan modification, foreclosure, and securitization policies and procedures. “This will help to prevent future compliance failures and restore the confidence of shareholders, regulators, legislators and mortgage markets participants,” the coalition advised in its letter. The coalition members’ insistence on immediate action reflects the urgency of their concerns over mishandled mortgages. But Jim Cramer on Friday said there was no urgency, and no reason to be concerned, and that this is nothing but a buying opportunity for the lemmings which jut got one step closer to the cliff.
_____________________________________


Let's be clear----there were trillions of dollars in subprime mortgage fraud.  The number of homes in America involved was massive.  The reason this fraud was allowed to continue and goes without justice is the goal of this entire scheme was to remove the American people from homeownership----

THE EQUITY WE THE PEOPLE GAINED OVER DECADES OF SAVING AND INVESTMENT.

    I want people who are still losing their homes to foreclosure....and Maryland is ground zero for this.....that damages to the US economy from this massive fraud need to extend to families facing long term unemployment and are now losing their homes.


Remember, all US big banks are still responsible for massive fraud but BOA and CITIBANK were the ringleaders.

Bank of America: Too Crooked to Fail The bank has defrauded everyone from investors and insurers to homeowners and the unemployed. So why does the government keep bailing it out?


By Matt Taibbi March 14, 2012 10:55 AM ET

Rolling Stone

At least Bank of America got its name right. The ultimate Too Big to Fail bank really is America, a hypergluttonous ward of the state whose limitless fraud and criminal conspiracies we'll all be paying for until the end of time. Did you hear about the plot to rig global interest rates? The $137 million fine for bilking needy schools and cities? The ingenious plan to suck multiple fees out of the unemployment checks of jobless workers? Take your eyes off them for 10 seconds and guaranteed, they'll be into some shit again: This bank is like the world's worst-behaved teenager, taking your car and running over kittens and fire hydrants on the way to Vegas for the weekend, maxing out your credit cards in the three days you spend at your aunt's funeral. They're out of control, yet they'll never do time or go out of business, because the government remains creepily committed to their survival, like overindulgent parents who refuse to believe their 40-year-old live-at-home son could possibly be responsible for those dead hookers in the backyard.

It's been four years since the government, in the name of preventing a depression, saved this megabank from ruin by pumping $45 billion of taxpayer money into its arm. Since then, the Obama administration has looked the other way as the bank committed an astonishing variety of crimes – some elaborate and brilliant in their conception, some so crude that they'd be beneath your average street thug. Bank of America has systematically ripped off almost everyone with whom it has a significant business relationship, cheating investors, insurers, depositors, homeowners, shareholders, pensioners and taxpayers. It brought tens of thousands of Americans to foreclosure court using bogus, "robo-signed" evidence – a type of mass perjury that it helped pioneer. It hawked worthless mortgages to dozens of unions and state pension funds, draining them of hundreds of millions in value. And when it wasn't ripping off workers and pensioners, it was helping to push insurance giants like AMBAC into bankruptcy by fraudulently inducing them to spend hundreds of millions insuring those same worthless mortgages.

But despite being the very definition of an unaccountable corporate villain, Bank of America is now bigger and more dangerous than ever. It controls more than 12 percent of America's bank deposits (skirting a federal law designed to prohibit any firm from controlling more than 10 percent), as well as 17 percent of all American home mortgages. By looking the other way and rewarding the bank's bad behavior with a massive government bailout, we actually allowed a huge financial company to not just grow so big that its collapse would imperil the whole economy, but to get away with any and all crimes it might commit. Too Big to Fail is one thing; it's also far too corrupt to survive.

All the government bailouts succeeded in doing was to make the bank even more prone to catastrophic failure – and now that catastrophe might finally be at hand. Bank of America's share price has plunged into the single digits, and the bank faces battles in courtrooms all over America to avoid paying back the hundreds of billions it stole from everyone in sight. Its credit rating, already downgraded to a few rungs above junk status, could plummet with the next bad analyst report, causing a frenzied rush to the exits by creditors, investors and stockholders – an institutional run on the bank.

They're in deep trouble, but they won't die, because our current president, like the last one, apparently believes it's better to project a false image of financial soundness than to allow one of our oligarchic banks to collapse under the weight of its own corruption. Last year, the Federal Reserve allowed Bank of America to move a huge portfolio of dangerous bets into a side of the company that happens to be FDIC-insured, putting all of us on the hook for as much as $55 trillion in irresponsible gambles. Then, in February, the Justice Department's so-called foreclosure settlement, which will supposedly provide $26 billion in relief for ripped-off homeowners, actually rewarded the bank with a legal waiver that will allow it to escape untold billions in lawsuits. And this month the Fed will release the results of its annual stress test, in which the bank will once again be permitted to perpetuate its fiction of solvency by grossly overrating the mountains of toxic loans on its books. At this point, the rescue effort is so sweeping and elaborate that it goes far beyond simply gouging the tax dollars of millions of struggling families, many of whom have already been ripped off by the bank – it's making the government, and by extension all of us, full-blown accomplices to the fraud.



______________________________________

Here you see while Bank of America was known to be in debt of a trillion or more in US fraud....it took its bailout money and expanded overseas where it invests in more high-risk and leverage as much as before the crash.  As this article shows, the Chinese are creating the environment that will hasten a collapse in our US economy this year.


Bank of America advises China default contracts to hedge debt storm Chinese bond yields have already risen to the highest in a decade yet markets remain “complacent” about the implications Bank of America's Bin Yao says markets have underestimated the risk of a monetary squeeze

 Photo: EPA By Ambrose Evans-Pritchard

2:15PM GMT 13 Dec 2013



Bank of America has advised clients to take out default insurance against Chinese debt, warning that monetary tightening by China’s central bank risks setting off a bout of serious credit stress in 2014.

Bin Yao, the bank’s credit strategist in Asia, said Chinese bond yields have already risen to the highest in a decade as the authorities seek to rein in rampant growth of the M2 money supply and excess credit, yet markets remain “complacent” about the implications.

He recommends buying credit default swaps (CDS) on five-year Chinese debt as the easiest way to “hedge the China tail risk”. These contracts spiked to 266 after the Lehman crisis and again to 206 during the ‘hard-landing scare’ of late 2011. They have since settled down to stable levels, trading this week near 66.

Bin Yao said the markets have underestimated the risk of a monetary squeeze. The central bank has already raised interest rates by three quarters of a point over the last year. Rising yields are pushing the shadow banking system closer to the brink. “We find trust loans especially troubling,” he said.

Short-term debt issuance by trust companies has jumped to $320bn from almost zero two years ago. A new study by the China Academy of Financial Research warned that the trusts face a redemption shock after promising returns of 10pc to 15pc that may be impossible to deliver.



________________________________________

The American accounting system GAAP is just too burdensome with all of the defined rules that allowed accounting fraud to be easily investigated and prosecuted.  That is why we need to go with this International Accounting Standard.  In order to successfully break from any ability of the public to prosecute fraud as happened with Enron and Aurthur Anderson Accounting, the ability of Americans to file lawsuits for accounting irregularities must be curtailed.


So, they are doing to the accounting sector what was done with the financial deregulation by adopting this International system with much weaker and broadly defined rules.

MIND YOU----THIS IS OBAMA AND A MAJORITY CONTROLLED CONGRESS ALLOWING THIS.  THE SECURITY AND EXCHANGE COMMISSION IS ACTING WITHOUT ANY THOUGHT OF PUBLIC INTEREST.  THAT IS A NEO-LIBERAL FOR YOU!

DO YOU HEAR YOUR POLS SHOUTING AGAINST THIS????


The Dark Side of Global Accounting Standards

Expect loose standard-setting in the oil and gas industries and a ton of litigation if convergence hurtles down its current track, critics say.

  • David M. Katz    CFO
  If the Securities and Exchange Commission on Thursday votes as expected and allows non-U.S. issuers here to report their financials in line with International Financial Reporting Standards without reconciling them with Generally Accepted Accounting Principles, the United States will have crossed a point of no return in the movement toward a single set of global accounting standards, some experts feel.

But that doesn’t mean that many key players won’t cross that line without a fair amount of kicking and screaming.

Speaking at a roundtable discussion on global accounting standards at New York University’s Stern School of Business on Monday, Charles Niemeier, a member and former acting chair of the Public Company Accounting Oversight Board, said that he was “a bit troubled by the speed” of the SEC’s march toward the convergence of U.S. and international accounting standards.
“If we eliminate reconciliation, what have we done? I have some fear that we’re crossing the Rubicon — that we’ve lost leverage in order to get closer [to global uniformity].”

Leverage by U.S. regulators and standard-setters to push for rigor in converged standards could be lost, as well as the clout to hold individual companies to international rules, Niemeier told CFO.com. At the roundtable, the audit firm overseer disputed a basic premise of the proponents of convergence: that if the international standards are adopted in the United States, it would produce a clearer system based on solid principles rather than rule-based minutiae. “Some say Europe is principles-based. I beg to differ. It’s younger,” he said, suggesting that much of the detail in GAAP is justified by long-standing experience. Some speakers said that IFRS lacks the detail provided under GAAP to provide adequate financial reporting in a number of specific industries in the United States, particularly oil and gas and insurance.

By contrast, critics of U.S. GAAP’s complexity, including the SEC’s own advisory committee, consider industry specific guidance to be one of the U.S. accounting system’s major flaws.

At the same time, many roundtable participants worried that the U.S. legal system — also blamed for the complexity of U.S. GAAP — might trip up global accounting standards too. Under the U.S. legal system, they said, auditors feel they must adhere closely to preset rules in order to avoid being sued. In order for IFRS to take hold in the United States, there needs to be “a change in the way we look at litigation in America, where it’s a mark of honor to sue someone,” said Stern accounting professor Seymour Jones at the roundtable.


Even a decision by the SEC to recognize the International Accounting Standards Board (which sets IFRS) as a bona fide standards setter could get tested in a U.S. court, according to Stanley Siegel, an NYU law professor. “Nothing is going to stop an American litigant who has bought shares in an American company or a Brazilian company” issuing stock in the United States from questioning the validity of the SEC’s choice of IASB under Section 108 of the Sarbanes-Oxley Act, he said. (Sarbox 108 enables the SEC to designate a standard setting body’s accounting principles as “generally accepted.”).

Indeed, many seem to feel that the SEC is moving ahead too swiftly and without adequate planning for what truly looms as a major step in the direction of converged international accounting standards. Even Financial Accounting Standards Board chairman Robert Herz, perhaps convergence’s prime U.S. spear carrier feels that “a national plan” for convergence needs to be in place before target dates are set. “Before you get to a timetable,” the key players need to determine “what are the tasks to be done.” High on the plan’s priority list should be educational and regulatory requirements. Underscoring the point about education, Nieimeier said in an interview that few people at PCAOB understand IFRS.

Nevertheless, convergence seems to be proceeding apace. While the SEC has been promoting the idea of installing a single set of international standards for about 20 years, the notion has gone into high gear in the last year, according to John White, the director of corporation finance at the SEC.

The reconciliation proposal, which White and SEC Chief Accountant Conrad Hewitt will present to the commission on Thursday, would create the unprecedented existence of “two co-existing financial reporting systems in the U.S.,” White said at a Financial Executives International conference in New York earlier this week. In developing the proposal, he said, the commission had three questions to answer:

• Is there a satisfactory convergence process in place?

• Are International Financial Reporting Standards being consistently and faithfully applied?

• Is IASB up to the job of setting global financial accounting strictures?

The commission is apparently satisfied enough with the answers to go ahead with at least the first step. The percentage of public issuers in the United States that will be affected is modest, however. Just 1,100 companies out of the 11,000 entities that report their financials to the SEC are foreign issuers, and only 200 of them use GAAP. Of the remaining 900 foreign companies required to file a GAAP reconcilation report, up to 180 may qualify to take advantage of the proposal if they file their financial reports using the IASB’s version of IFRS.


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March 08th, 2014

3/8/2014

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IF YOU WANT TO KNOW WHY CRIME AND VIOLENCE IS SO HIGH IN BALTIMORE-----LOOK BELOW AT HOW BAD PUBLIC POLICY IMPOVERISHES JUST TO ENRICH A FEW!

ALL OF OUR PUBLIC ASSETS ARE BEING HANDED TO RICH DEVELOPERS FOR NEXT TO NOTHING IN AREAS SLATED TO HAVE HIGH PROPERTY VALUE.  IF KEPT PUBLIC PROPERTY------THAT WOULD BE PUBLIC WEALTH.  EVERYONE SHOULD BE CONCERNED BECAUSE THIS IS NOT ONLY ABOUT GETTING THE WORKING CLASS OUT OF CITY CENTERS....

WOMEN AND CHILDREN ARE THE VICTIMS.

IT IS ABOUT TAKING PUBLIC LAND AND ASSETS THAT MIDDLE-CLASS TAXPAYERS BUILT.


The Obama Administration is privatizing all that is public faster than Bush and that includes the Housing Urban Development agency  HUD.  Federal policy sends all kinds of taxpayer money to dismantle public housing and projects with the idea that these are bad for the poor and communities.  This is likely true------concentrated poverty in these projects is not a good idea.  The problem is that there is no intention of providing any other opportunity and in fact, the policies are leaving even more people homeless and impoverished AND THE MONEY IS BEING FUNNELED INTO THESE CORPORATE DEVELOPMENT PROJECTS.

Below is a good article giving a long view of public housing policy. I include just the Obama years because we need to look at again, a neo-liberal saying they are going to do something progressive and not doing it.  So, with public housing like with fraud,......supposedly we cannot easily seek justice because the definitions are left vague.  OBAMA HAS LEFT PUBLIC HOUSING DISCRIMINATION VAGUE AS HE HAS IGNORED FRAUD. 

What I want to emphasize is that tons of Federal money is coming for public housing and being funneled into projects that are making the rich richer and doing nothing for the people paying the taxes.  Here in Baltimore, consolidation of real estate into the hands of a few is indeed aided by these funds and it is all illegal.  So, the low-income lose and the taxpayers lose. 

ALL GOES TO THE PEOPLE AT THE TOP.  WE NEED THAT MONEY BACK.  IT IS THE PUBLIC'S MONEY.

Living Apart: How the Government Betrayed a
Landmark Civil Rights Law

 
 
by
Nikole Hannah-Jones
ProPublica,  Oct. 28,
2012, 11 p.m.




A 2009 internal HUD study found that many communities were not even bothering to complete the required fair housing paperwork when they applied for block grants.
In a sample of 70 applicants, 35 had not provided an "analysis of impediments" to fair housing, prompting HUD to conclude that they were "apparently not performed at all." Nearly all of the reports received were considered substandard, the review found.  A year later, investigators from the Government Accountability Office confirmed what civil rights advocates had long known:
HUD's system for ensuring compliance with the fair housing law was a sham.
GAO officials reviewed documents filed by 441 recipients of
block grants, a step HUD officials do not routinely take.


They found that about one-third of the fair housing materials were out of date. More than one in 10 hadn't been updated since the '90s. Communities in the Midwest and Northeast — the most-segregated regions of the country — performed
the worst.

The GAO dismissed the analyses of impediments to fair housing that some communities provided as worthless because of their "brevity and lack of content." Most did not offer time frames for when the communities would
eliminate barriers to integration or include the required signatures of the relevant elected officials.



Investigators noted that 25 recipients of block grants had filed no analysis, "raising questions about whether some jurisdictions may be receiving federal funds without preparing the documents required to demonstrate that they have taken steps to affirmatively further fair housing."


According to the GAO, HUD staffers in seven regions had read the key documents for just 17 of 275 block grant recipients. Efforts to ensure "the integrity of the AI process...were not common," the report said.

The GAO made a number of recommendations. But HUD didn't even adopt the simplest one: to require that grantees submit their analysis of impediments for HUD to review.
In interviews, many HUD officials acknowledged they have no idea how to enforce the provision for affirmatively furthering fair housing. Already overstretched, they focus on what is clear: the disability accommodations provision of the Fair Housing Act. It's simple, they say, to check off whether
an apartment door is wide enough for a wheelchair or if a parking lot has enough handicapped spots.


But compliance officers stumble when it comes to race and segregation.  One said she received little training on how to apply the 1968 act to block grant recipients. "The one week of training I was sent to, you focus on the civil rights law as a whole," she said. "You're not focused per se on
segregation." The official said she did not review broader issues such as the impact of discriminatory zoning "because I don't even know what they are."


Rolando Alvarado supervised fair housing enforcement for HUD in New Jersey for more than a decade. When asked to define "affirmatively furthering fair housing," he exhaled and then paused. Ten seconds passed.  "That is tricky. There is no exact regulation, it's a gray area," said Alvarado, who retired in 2009. "I've never seen anything that clearly defines
that in my time at HUD."


Alvarado said he relied on his staff to ensure enforcement of the mandate. But how could his subordinates enforce something he himself could not explain?
"You are right. I don't know," he said. "It was reliance on if staff had conducted enough investigations and compliance reviews they would have an inkling of what to look for."


Alvarado said he could not recall a single instance in which he challenged a community's assertions about its efforts to further fair housing. When it comes to these issues, he said, "You are basically taking them at their word."  After the Westchester settlement, in which the judge criticized the
department for failing to enforce the law, the word came down from HUD leaders that there should not be a recurrence. Officials say that directive was not accompanied by any training, additional staff or instructions on what practices
should be examined.


"The message is that we need to be more aggressive but absent the new rule, there is very little guidance as to what would constitute a failure to affirmatively further fair housing," said a senior fair housing official. "There's a car here and nobody knows how to drive it."



Trasvina promised Congress in January 2010 that by the end of the year the agency would release a rule requiring communities that receive money from the
agency to "promote integration." More than two years later, those regulations have not been issued. HUD has declined to say when they might appear or give a reason for the delay.



The focus of HUD's civil rights work appears to have veered away from race.  In March, the department issued a rule banning discrimination against gay and transgender people in HUD-assisted housing and by lenders receiving guarantees
from the Federal Housing Authority.

Asked what they are doing to fulfill the Fair Housing Act's mandates, HUD officials pointed to Joliet, Ill., where HUD has withheld block grant funds over the city's attempt to demolish a mostly black federally subsidized apartment complex. HUD also has withheld block grant money from Westchester County, which the Justice Department says has failed to live up to the terms of its settlement agreement.


Brian Sullivan, a spokesman for the housing agency, said in an email that HUD "very nearly" cut off block grant money for Galveston, Texas, and threatened to do so in Delaware's Sussex County.  But other communities with serious questions about fair housing continue to receive federal housing dollars, and fair housing officials say the agency still
brushes civil rights concerns aside. One senior housing official pointed to New Orleans, which hasn't lost its block grant despite the Department of Justice lawsuit. "If that's not enough to reject a grantees' funding," he said. "Any finding from the fair housing office will not ever be sufficient."


Another example is Waukesha County, Wisc. HUD launched an investigation of the 90 percent-white county last year following a complaint from a fair housing group. The group accused the county of allowing its nearly all-white communities to block rental housing to keep out African Americans and Latinos from neighboring Milwaukee. African Americans and Latinos account for 57 percent of
the city's population.  Yet the agency treats Waukesha County no differently from racially integrated Montgomery County, which has a 30-year track record of placing affordable
housing in its most prosperous neighborhoods. Waukesha still receives its automatic influx of HUD dollars.


"It is fair to say, it is accurate to say, that the only situation in which HUD is doing anything effectively to affirmatively further fair housing are situations where there has been litigation," said Florence Wagman Roisman, a law professor at Indiana University. "Then it does as little as possible, as
grudgingly as possible."

Prospects for substantial change appear dim.



Obama administration officials say that if the president is re-elected, they will complete work on the long-delayed rules defining what it means to "affirmatively further fair housing."


At a private fundraising event in Florida in April, Mitt Romney said he would consider closing down HUD if he wins the election."I'm going to take a lot of departments in Washington, and agencies, and combine them," he said. "Things like Housing and Urban Development, which my dad
was head of, that might not be around later."


Have you experienced discrimination under the Fair Housing Act?
Share your story with us.



ProPublica's Kirsten Berg contributed to this story.



_________________________________________-

NEO-LIBERALS HATE ALL WAR ON POVERTY AND NEW DEAL POLICY AS MUCH AS REPUBLICANS.  SO LABOR AND JUSTICE ARE BEING ATTACKED BY NEO-LIBERALS.  DO NOT BELIEVE THE TOKEN PROGRESSIVE BONES BEING THROWN.

What to do with public housing and the people they support.  Well, logic has it that you can demolish the high-rises with the Federal money and invest in low-income housing within all Enterprise Zones.  That is what should be happening.  All of those public housing are on property in the city centers that will become valuable as development continues so keeping them public.......a park, public community/recreation centers, etc are what public interest requires.  Yet, in Baltimore, all of this public land is going to developers.....again in large parcels to control all of how the community will be developed. MARKET-RATE IS THE THEME!!!


Below you see exactly what they intend to do in Baltimore and Maryland-----what this does is eliminate any future use of that property for the public AND IT KEEPS THE PRIVATE CORPORATION FROM PAYING PROPERTY TAXES ON THIS DEVELOPMENT.  In Baltimore, they will even get deferment on all other taxes and they will get tax breaks for remodeling the building.  It's like placing public garages under private buildings to have public subsidized private parking.  Remember, all of this public housing property will become high-end as development continues saving tons of money in property taxes.

EVEN IF YOU WANT TO BE RID OF LOW-INCOME PUBLIC HOUSING....THINK OF THE PUBLIC LAND INVESTMENT AND WHERE THESE PEOPLE GO----IT ALL CREATES THE ENVIRONMENT OF CRIME AND VIOLENCE AS PEOPLE LOSE JOBS AND HOMES.



New York Public Housing Land To Be Leased For Pricey Apartments

By MEGHAN BARR and JENNIFER PELTZ 
03/08/13 03:17 AM ET EST                                        
 
NEW YORK -- New Yorkers pay dearly for the privilege of living in one of the world's great cities. But would they shell out top dollar for an apartment on the grounds of a public housing project?


That scenario could play out across Manhattan under an unprecedented proposal by the city housing authority to lease out public housing land and allow developers to build market-rate apartment buildings – intended for much wealthier residents – on areas currently occupied by basketball courts, parking lots and outdoor plazas.



City Council Moves to Stall Land Leases at Public Housing
By 
MIREYA
NAVARRO

Published: October 10, 2013    
 
    
The New York City Council and a group of tenants sued
the
Bloomberg administration on Thursday over plans
to lease land in public housing developments for the creation of market-rate apartments.
  
   
 
The lawsuit, filed in State Supreme Court in
Manhattan, stems from a long-running controversy over the
New York City Housing Authority’s proposal to
raise revenue for repairs and capital projects by allowing private developers to build on the grounds of eight public housing projects in Manhattan.
     
  


Housing officials have given developers a Nov. 18
deadline for proposing ideas — so-called expressions of interest — but it was unclear whether they would be able to select construction projects before the change in administration that will follow the November mayoral election.        

Lawyers for the plaintiffs say the lawsuit is intended
to forestall any deals with developers before Mayor Michael R. Bloomberg’s term is over. “The city has the ability to designate a developer and tie the hands of the incoming administration,” said Steven Banks, attorney-in-chief of the Legal Aid Society, which is representing the tenants. “The new administration would be without remedy.”       


Democrat Bill de Blasio, the leading candidate for
mayor, has not ruled out developing land owned by the housing authority, but he has said he favors building affordable housing, not market-rate units. The public housing system has more than 400,000 residents and $6 billion in unmet capital needs.       


The Council objected to being left out of the
decision-making regarding the plan to build on public housing grounds. In their lawsuit, the plaintiffs seek to have the city rescind the request for expressions of interest. They argue that under state law, housing officials have no authority to lease public housing land for high-income residents and that
they must submit their plan to the Council for approval
.       

“There’s still a need for more low- and middle-income
housing, and that should be the city’s priority,” said Rosie Mendez, who heads the Council’s committee on public housing.
       


In response to the lawsuit, the housing authority
issued a statement saying that it “has heard significant interest from developers and looks forward to receiving their proposals next month.”        

“It’s unfortunate that the City Council is attempting
to block a proposal that would generate significant revenue for the New York City Housing Authority — money that would go directly into developments and repairs for residents,” the statement said.




FEDERAL MONEY YET AGAIN FUNNELED TO THE SAME INVESTMENT FIRMS/DEVELOPERS GETTING TAX BREAKS FOR DEVELOPING IN UNDERSERVED COMMUNITIES AND ALL THE PEOPLE LIVING IN THESE COMMUNITIES WILL BE DISPLACED.


What Rawlings-Blake and O'Malley with City Hall
are doing is privatizing all that is public.  Public employee unions are busted and pay is lowered to poverty.  This is what happened as MTA is privatized with VEOLA and it is what is being tried with longshoreman unions at the Port of Baltimore.  It is all union-busting and impoverishing of labor.  So, why are unions backing all of Maryland's neo-liberals every election rather than running labor and justice?



 The US Constitution protects equal opportunity and access in housing and education.  What Baltimore is doing is illegal because they not only ignore equal access, they try to pass laws that say 'we will accept Federal funding for development but not honor equal access and opportunity laws'.  They pretend they can do this and they cannot.  It is public malfeasance.

Below is  a good analysis of Baltimore's situation.  It is too long to copy but check it out.  I would just like to emphasize throughout is the disregard of real data and deliberate disregard to Rule of Law and adherence to Federal requirements.  This is important in getting the public's wealth back and hopefully helping those displaced with justice.  Breaking these laws is not only public malfeasance but fraud on the part of the developers knowingly failing to meet terms of Federal and State contracts.


September
2007
Volume 20, Number 4


What we think about, and what we’d like you to think
about

THE ABELL REPORT
Published as a community service by The Abell Foundation


Erroneous reporting leads to a
lack of public concern



“Baltimore Housing currently serves
over 40,000 residents in more than
14,000 housing units.” This statement
appears (as this study is being written) on
the city’s public housing website. HUD
also reports a similar number — 14,446.
But the true numbers of public housing
units being used in Baltimore are far
lower and can be found in the Housing
Authority’s most recent annual plan, as well
as City Hall’s Citistat Reports.
Nevertheless, the Housing Authority and
HUD continued to use these outdated
numbers in 2007. The HUD official
who oversees Baltimore’s housing
authority appeared unaware that as of
spring 2007, Baltimore only had 10,748
available units in its inventory (with
1,123 of them vacant).
The absence of accurate and consistent
reporting and the lack of analysis of
the loss of public housing has served as
a convenience in a political climate
where even a suggestion of building a
small number of public housing units
can cause a neighborhood uproar.

A lack of public
participation



Housing advocates have complained
of a lack of public input in the demolition
plans, despite federal law requiring
a housing authority to “conduct reasonable
outreach activities to encourage
broad public participation” in its annual
public housing plan.  At a sparsely
attended April 17, 2007 hearing on the
future of Baltimore’s public housing,
several advocates protested that they
found no public notice of the event, and
questioned why it wasn’t posted on the
agency’s website.

Housing officials said sufficient
notice was given when they advertised
in The Baltimore Sun and the Afro-
American in March and at the Enoch
Pratt Free Library. The Baltimore Sun
notice, however, was a tiny, one inch by
three- and three-quarter-inch ad buried
in the classified ads that ran for three
days, a month before the hearing.  During
the hearing, no copies of the 100-
page plan were available (though an
electronic copy was on HABC’s website),
and housing officials gave no
overview or public explanation for their
decision to demolish projects.  One
advocate accused housing officials of
trying to “circle its wagons” against
public participation and called the plan
“a roadmap for the continued decline of
public housing.”  Each of the eight
people testifying was given two minutes to speak. The hearing was over in a half hour.


__________________________________________



 Equally important for citizens of Baltimore is the
fact that Baltimore HUD is probably the most corrupt of all corrupt agencies in Baltimore and as such all kinds of red flags will go up with these public properties.  Keeping this property in city central that will become valuable as
development occurs is the only thing to do in public interest.  We could build multi-income housing, parks, public community centers with this public
land.  Since Baltimore HUD is corrupt, they will hand it off undeveloped for cheap to a connected investor who will make tons of money on this property when development of this area is finished.  See why it is public malfeasance.

The second part to this is the workers who represent a
dying middle-class in Baltimore with the attack of middle-class jobs and leaving Baltimore families desperate and poor.  Extended families depend on these strong
jobs and it is this policy of killing Living Wage jobs that give us Baltimore's high crime and violence culture as people turn to drug dealing et al to survive. All for no good reason.

The City of Baltimore loses billions of dollars
to fraud and corruption and rebuilding public justice in the city would fill the  city's coffers and allow for a healthy public sector.  Handing all that is public to private ownership or public private partnerships is what fuels all the fraud and corruption.  We will need to investigate these sales to assure this is not yet another example of public malfeasance.  You see, these residents know the history of these promises to the underserved....the Federal money is used but none of the requirements to help the low-income are carried through.

Workers nervous about layoffs as Baltimore Housing Authority sells off  buildings Residents say they want protections from private developers in writing

Below you see the other side of what this privatization brings-----more public sector jobs
lost with the prospect of private jobs paying nothing.


The Lakeview Towers
  on Druid Park Lake Drive are among the first of 22 housing complexes to be 
offered for sale under a plan by the housing authority.
   

 
                      
(Kim  Hairston, Baltimore Sun / August 10, 2005)            
                                                               
 
Union officials warned Thursday that as many as 200 maintenance workers and  building monitors at Baltimore's public housing properties could lose  their jobs under a plan intended to infuse the buildings with private money.


Employees such as maintenance mechanic Lucky Crosby Sr., who has worked for  the
Housing  Authority of Baltimore City for a decade, say they took the jobs with the  understanding that the pay was relatively low, but the work was secure.


"By working for the Housing Authority, we joined the credit union so we could buy homes that we have to finance," said Crosby, 46, of Sandtown-Winchester.  "We  bought cars that we have to finance."


Housing Commissioner Paul T. Graziano acknowledged that some jobs might be  lost as 22 of the agency's 28 properties are sold to developers over the next 
two years. He said the Housing Authority is keeping some positions vacant and  filling others with temporary workers to reduce the potential number of 
layoffs.  Graziano said the agency is encouraging the developers to hire some of the  workers, and to keep them apprised of the latest information as soon as it's 
available.


"This is a very large change, a massive change in the way we're doing  business, and I understand change does create anxiety," Graziano said. "We're  trying to provide whatever assurances we can." 
The Housing Authority has identified 11 developers to buy the buildings.  Several of them declined to comment Thursday.


The federal government is offering tax credits to developers who buy and renovate public housing.
Officials say the effort is intended to improve the lives of low-income  Americans. But in the case of the maintenance workers, Anthony Coates said, it's 
doing just the opposite.


Coates, president of AFSCME Local  647, said members who lose their jobs could lose their homes.


"We're the working poor," he said. The maintenance workers, who earn between about $15 and $20 an hour under  their most recent contract, want the Housing Authority to tell them how many  workers face layoffs, Coates said.

He said knowing the scope of the layoffs is especially important for the  older maintenance workers on staff, who may find it harder to get new jobs.

Coates accused the agency of stalling contract negotiations. Senior housing 
officials rejected the accusation, and said a meeting is scheduled for next  week. They said inclement weather forced them to postpone some meetings.


Anthony Scott, executive director of the Housing Authority, said the federal 
program has unfolded rapidly. The Housing Authority began preparing its 
application to the
U.S.  Department of Housing and Urban Development over the summer, submitted it in  October and found out it had been approved in
December.

"We informed our employees as quickly as we could," Scott said. Graziano said the agency already has a "significant number of vacancies," but declined to say how many.

It's "a moving target," he said.

On top of that, he said, at least 10 percent turnover is expected each  year.  He said Housing Authority workers would be attractive employees for the 
developers

______________________________________________
 Neo-liberals are working for control of all real estate by a few.  The good news is that most of the wealth lost to the middle-class is through fraud and needs to come back.  Think of the tens of millions of homes caught in the subprime loan fraud and foreclosed....many families need these homes replaced.  So, the middle-class is still the middle-class.....just waiting for justice!

If you notice the list below include the same financial and investment firms that created and profited from the massive subprime mortgage frauds and indeed, they all still owe trillions in total fraud.  We can rebuild all public housing by simply recovering the fraud.  Yet, the plan was to steal the homes through fraud and then hand all the city center property to those same people and that is what these Enterprise Zone and Public Housing deals do......with taxpayer subsidy as the cherry on top!

THE LOW-INCOME LOSE, THE TAXPAYERS LOSE, AND THE MIDDLE/WORKING CLASS LOSE ALL TO NEO-LIBERALS WORKING FOR WEALTH AND PROFIT.



10 Largest Private Equity Real Estate Firms               
         by
Andy
Macalaster
 • February
21, 2010    
 

The PERE 30 (from Private Equity Real Estate Magazine) revealed that the top 30 real estate private equity firms raised $211.9 billion over the past five years, up from $190 billion as calculated by last year’s ranking. Listed are the
top 10 largest real estate private equity firms.


As a note: the top two largest firms raised $25.6 billion and $20.15 billion respectively in dedicated real estate funds between January 2004 and April,
2009. Together the pair raised a fifth of all the direct-investment capital secured by the world’s 30 largest real estate private equity firms.



10. Westbrook Capital Partners
Westbrook has raised and invested $10 billion of equity in over $35 billion of real estate transactions in major markets throughout the world. Westbrook’s investment equity is
committed by a broad base of institutional investors, which includes public and private pension funds, endowments, foundations, and financial institutions.


9. The Carlyle Group
The Carlyle Group is one of the world’s largest private equity firms, with more than $87.9 billion under management with funds across four investment disciplines (buyouts, growth
capital, real estate and leveraged finance). Carlyle has committed more than $3.6 billion of its own capital to its funds.

8. Tishman Speyer
Tishman Speyer has acquired, developed and operated over 325 projects totaling over approximately 116 million square feet and more than 92,000 residential units,
and a property portfolio of US$50.2 billion internationally.


7. LaSalle Investment Management
LaSalle Investment manages approximately $39.9 billion (as at Q3 2009) of private and public property equity investments. Their client base includes public and private
pension funds, insurance companies, governments, endowments and private individuals from across the globe.


6. Lehman Brothers Real Estate Partners
Lehman Brothers Real Estate Partners has raised over $10 billion in capital over the last five years with a total of $44 billion in transactions among 1,150 properties.


5. Beacon Capital Partners
Since its inception in 1998, Beacon Capital Partners has sponsored six investment vehicles representing over
$8.5 billion aggregate equity capital from various endowments, foundations and pension funds. Beacon Capital Partners was established after the predecessor public company, Beacon Properties Corporation (a New York Stock Exchange listed
company), merged with Equity Office Properties Trust in a transaction valued at $4 billion.


4. Colony Capital
Colony Capital is a private, international investment firm based in Los Angeles, California. The company focuses on real estate opportunities around the world either on its own, through funds run by the company, or in joint ventures. The company is run by billionaire Tom Barrack.


3. Goldman Sachs Real Estate Principal Investment Area

The Real Estate Principal Investment Area (REPIA) manages a series of global opportunistic real estate funds, known as the Whitehall Funds, and other niche products. REPIA, through the Whitehall Funds, offers Goldman clients the opportunity to co-invest in real estate and real estate related assets
worldwide.


2. Morgan Stanley Real Estate Investing
Morgan Stanley Real Estate has the longest uninterrupted real estate industry presence of any Wall Street firm. MSREI has raised over $20 billion in capital in the last five years and has completed over $58 billion in transactions.



1. The Blackstone Group
Blackstone’s real estate fee earning assets under management totaled $23.7 billion as of September 30, 2009.
Assets include office, hotel, healthcare, retail and multi-family properties around the world.  Blackstone has the world’s leading hotel portfolio, as well as one of the largest portfolios of office buildings in the United States.
Blackstone’s real estate group currently has over $12 billion of equity capital available for investment, the largest pool of capital for real estate investments available today.


For a full list of the top 30 real estate private equity firms with an executive summary click
here.

_________________________________________

Below you see reverse mortgages as a tool to make sure homeownership does not go beyond this generation for most of the middle/working class.  Land ownership is for the gentry you know!  Reverse mortgages are not always bad.  We had our mother's retirement supplemented by reverse mortgage.  The problem these least several years is that people are not having the money for retirement because it was stolen and not because they did not save.  These are the people being forced into reverse mortgage now. 

THESE HOMES SHOULD NOT BE LOST TO FAMILIES AS FRAUD AND DAMAGES HAVE NOT BEEN RECOVERED TO THE PUBLIC. 

Remember as well, Obama's Administration is deliberately allowing a manipulated inflation rate of near zero lower all of the public's COLAs by hundreds of dollars.  So seniors and vets owning homes are losing hundreds of dollars in monthly payments because of what is a 'manipulated' inflation rate.  Never in the history of public programs has the COLAs not been 3-5% as inflation never has been lower.  Please look at my blogs on faulty inflation data if you cannot see that what you are buying at the store is costing much more.

Low-income people are being hit from every direction in fraud and corruption making sure they do not have what they need for retirement and neo-liberals are in office to see this happens.  It is not only republicans.....it is neo-liberals running as democrats!


Sun Aug 18, 2013 at 06:45 PM PDT


Reverse mortgages: The final blow killing middle class
wealth

byEgberto WilliesFollow forDaily Kos


 Many fellow Americans that have worked their entire lives, weathered several
recessions and depressions, put their children through school, helped many in
need, and faithfully paid their mortgages for decades are now being taken advantage of once again. Most have followed all the rules necessary to be considered fiscally responsible, yet because of "legal fraud" by the financial sector and policies effected by purchased politicians, their years in retirement
will be compromised.


The Plutocracy, the one percent has walked away with a large percentage of their 401Ks, their SEPs, and to some extent their financial security. Because of stagnant or falling real wages, much of the working middle class
have maxed out on their credit in the attempt to maintain their standard of living. For a Plutocracy that feeds on perpetual growth, from where will it feed now? An old and well-crafted financial instrument known as the reverse mortgage is being marketed on steroids to a baby boomer population.


Before any reader of this article that may have already taken out a reverse mortgage gets upset, please note that it is understood that for many this is the
only option left. That said, every American should be fighting for a system that allows all the ability to build a nest egg that can be transferred to the next generation.

 Back in 2010, Sen. Fred Thompson was a spokesman for AAG and was pushing their government back reverse mortgages. I was writing
my book when the
commercial came on and I wrote the following in a chapter right then.
While taking a short coffee break from writing this book I saw former Republican Senator Fred Thompson, an AAG spokesman hawking reverse mortgages. He
says:
“Hi folks, I am Fred Thompson. Now like me you probably heard a lot about
reverse mortgages but weren’t quite sure how they worked or whether they would
be the right financial solution for you. Well take my word for it and hundreds
of thousands of other Americans who have used the Government Insured reverse
mortgage as a safe effective financial tool. If you are 62 year or older and own
your own home, give AAG a call and find out how a reverse mortgage can help you.
I am extremely proud to be associated with AAG, a national reverse mortgage
lender that is helping seniors overcome their financial worries and live the
lives they’ve dreamed. Why don’t you find out more by calling AAG today? Find
out how much call you may qualify for today.”



My first thought was how could a former Senator, a senior, a person who likes to tout morality be so callous to entice the elderly to splurge their wealth away. Most Americans have a large portion of their wealth in their homes. Having
some wealth to transfer to one’s offspring helps the next generation to the next financial level.


Unfortunately, yet another financial instrument designed to use the ignorance of the average American citizen’s knowledge of our economic system to donate
their money up the wealth tree to the rich. At the end of the reverse mortgage’s term, the elderly is left without an asset to transfer to their offspring at the time of their death.


Ironically as this piece is being written Fred Thompson is back on with the 2013 version of his "working middle class pilfering" commercial.  The most deceptive part of the ad is stating that the owner of the house retains ownership of the home. You cannot own something that you cannot give to
someone free and clear. Even more ironic is that Thompson, a professed small government conservative, is pushing a product that depends on the good faith and
capital of the United States government.


Most Americans amass most of their wealth within their homes. Each generation in a responsible family is better off when the previous generation wills their assets forward. Reverse mortgages are yet another financial instrument that
stunts the growth of the middle class by encouraging home owners to extract the capital out of their homes and use it as a supplement to their retirement or to simply splurge. Inasmuch as most reverse mortgages are federally regulated,
their upfront costs are very high. These costs amount to free cash for the bank and mortgage insurance companies, your money transferred to them for a marginal service.


The big dirty secret is that reverse mortgages, like student loans pre-Obama, are nothing but a no-risk gift to the bankers, a wealth transfer engine from the masses to a select few. When the "owner" of the home dies, the government pays
the bank any difference between the amount owed (interest plus principal) less the sale price of the home. If the heirs want to keep the home, they must pay the loan off in full. If the amount owed is more than the value of the home, the
heirs must pay 95 percent of what is owed to the bank with the government paying
the rest. What is the reason for the bank being in the transaction? It is there simply to extract from the government and the homeowner. They have absolutely nothing at risk for the profits they make.

Reverse mortgages mask a systemic problem that affects the American worker, a backward and inhumane retirement system. Every American worker makes a vibrant
economy possible by providing 40, 50 or more years of work, taxes, and spending. It is appalling that a worker is incapable of having Social Security capable of providing a decent living. No one should have to deplete all of their assets to
survive.


The trajectory in this country has been that the wealth and income of the very few at the top grows faster than the growth of the economy as a whole. This means that some of that growth is directly coming out of the pockets of the
working middle class in the form of lower wages, extractions from the government (tax dollars, interest payments, etc.), reverse mortgages, higher tuitions as states lower taxes, commercial student loans, etc.
This is an unsustainable path
and it is leading to a country where the vast majority of citizens will have no assets.
They will be functionally indentured servants. They will be nothing but a commodity, a unit of work and service.


Wake up America. Taking this country back from the Plutocracy will require education, resolve and action.
Taking this country back will entail taking back what was stolen through well designed redistribution mechanism that foments a vibrant working middle class.



0 Comments

September 25th, 2013

9/25/2013

0 Comments

 
STOP ALLOWING ALL OF YOUR PUBLIC ASSETS BE STOLEN BY NEO-LIBERALS WORKING WITH CORPORATE INTERESTS TO HAND ALL THAT IS PUBLIC OVER TO CORPORATE PROFITS!  FROM SCHOOLS TO PENSIONS; FROM WATER AND SEWER TO TRANSPORTATION....

ALL MARYLAND AND BALTIMORE POLS ARE NEO-LIBERALS, NOT DEMOCRATS!



Below you see the financial industry just as strong and predatory as always.  Absolutely nothing has been done to reign them in and they have super-sized their wealth while tens of trillions of dollars in corporate fraud are left to be recovered.

Moody's and S & P are two stock rating agencies that were ground zero for the massive subprime mortgage fraud.  They and MERS allowed the hundreds of millions of subprime loans be laundered through Wall Street and delivered all over the world.  We were supposed to see change in how stocks are assessed because, as anyone would know.....the entity being assessed can easily pay off the assessor.  NOTHING HAPPENED AND NOW MOODY'S IS TELLING YOUR POLITICIAN THAT THE PUBLIC PENSIONS THAT LOST 1/2 THEIR VALUE BECAUSE OF FRAUD NOW NEED TO BE CUT AGAIN.

Remember, it was City and State Comptrollers who sent public pensions into the stock market out of the safety of bonds in 2007......just so they could be used to buoy big banks.  That is why so many are now attached to Citigroup and Bank of America....the two banks most involved in the subprime  mortgage fraud.  THIS WAS PUBLIC MALFEASANCE AND HAS YET TO HAVE UNIONS/PUBLIC JUSTICE TAKING THIS TO COURT TO RECOVER LOSSES.

Comptrollers sent these pensions and the rating agencies provided the fraudulent high ratings.  MOODY'S SHOULD HAVE ITS ASSETS SEIZED AND GIVEN TO PENSION FUNDS TO RECOVER THE 1/2 OF VALUE LOST.  If your politicians are not shouting for this justice.....they are neo-liberals and need to go!

THERE IS NO STATUTES OF LIMITATION WHEN A GOVERNMENT SUSPENDS RULE OF LAW.....WE HAVE TIME TO DO THIS!

The damages from massive financial fraud of tens of billions of dollars?  $22 trillion.  WALL STREET OWES AMERICANS LOTS OF TRILLIONS!

Five years ago today, Lehman Brothers went bankrupt.

Instantly and inevitably, the house of cards otherwise known as Wall Street collapsed.

But after getting bailed out by the American taxpayers, Wall Street is doing just fine.

The people of Main Street? Not so much.

Here are some numbers to think about this Sunday morning.
  • Amount the crash cost the U.S. economy: $22 trillion
  • How much everyone would get if that $22 trillion were divided equally among the U.S. populace: $69,478.88  JUST FOR DAMAGES
  • Assets of the four biggest banks in America — JPMorgan Chase, Bank of America, Citigroup and Wachovia/Wells Fargo — when they were “too big to fail” in 2008: $6.4 trillion
  • Assets of those four banks today: $7.8 trillion
  • Of the 63 former Lehman Brothers employees identified by a bankruptcy examiner as being aware of an accounting scheme Lehman used to mask its true finances, number who are employed in senior financial services positions today: 47
  • Number of the 25 banks responsible for the bulk of risky subprime loans leading up to the crash that are back in the mortgage business: 25
  • Chances that an American voter thinks that regulating financial products and services is “important” or “very important”: 9 in 10
__________________________________________________

What?  Moody's does not recommend recovering massive fraud to bring pensions back to the black!  Rather, they are telling your pol to cut pensions more to make up for the losses from corporate fraud!


Moody's Proposes Making Pension Liabilities a Bigger Factor in Bond Ratings Posted

By Liz Farmer | September 19, 2013


States and localities with big pension liabilities could see changes to their overall bond rating if new rules proposed this summer by Moody’s Investor Service are adopted.

Moody’s is proposing giving more weight to pension liabilities and other long-term debts in its overall scorecards for rating general obligation (GO) bonds. The agency would increase the weight to 20 percent from 10 percent and decrease the weight for economic strength to 30 percent from 40 percent. Weights for governance and management (20 percent) and financial strength (30 percent) -- the other two factors in the way Moody’s scores its GO ratings -- would stay the same. The step by Moody’s is just the latest in what has become a marathon of changes by various organizations in recent years that aim to place a bigger emphasis on pensions’ effect on fiscal health.

Interested parties and stakeholders have until Oct. 14 to submit comments to Moody’s.


In its methodology paper, Moody’s noted that debt burden trends are an indicator of a population’s capacity to absorb additional obligations. In the event that a local government’s capital needs are great, this may foretell future financial distress. Thus, a bigger weight should be given to such burdens when considering an overall GO rating. Moody’s said in a release that it chose to reduce the weight on economic health because it recognizes that some local governments are either unwilling or unable to capitalize on the strength of their local economies (i.e., a city may not be able to raise taxes because of anti-tax sentiment).

But municipalities with a large unfunded liability may not necessarily see their rating automatically fall under the new rules, Moody’s said. “We recognize that funding levels naturally will rise and fall as retiree activity diverges from actuarial assumptions, as benefits change, or as investment returns fluctuate. In the case of an unfunded pension liability, Moody’s will examine the reason that it has arisen and the entity’s ability and willingness to address it over a reasonable period of time, which is broadly defined to encompass the working life of the beneficiaries so that liabilities are not passed onto a succeeding generation."

Want more finance news? Click here.

Only if such an analysis showed a pattern of underfunding annual pension contribution requirements, would a large unfunded liability “be viewed as a negative credit factor because it is a claim on resources that reduces financial flexibility,” Moody’s said.

Moody’s maintains GO ratings or issuer ratings for approximately 8,200 local governments: 2,960 cities, 864 counties and 3,362 school districts.

The methodology change, if kept intact, should bring more attention to dangerous unfunded liabilities earlier on in a municipality’s downward spiral and potentially help retirees, said Frank Shafroth, director of George Mason University’s Center for State and Local Government Leadership. He pointed to cities that have declared bankruptcy like Central Falls, R.I., where retirees had to give up half their pension income, and Detroit, where Emergency Manager Kevyn Orr has said pension cuts will be part of the restricting plan, and said that retirees have far less leverage in bankruptcy than out of it. If cities have more consequences for bad pension finance local officials may be more inclined to right the ship while it’s still feasible.

“We all have a human responsibility to protect these people,” Shafroth said.
  HE SAID AFTER MASSIVE FRAUD TAKES 1/2 OF PENSION VALUES IN 2008!

The methodology proposal comes after a change Moody’s made earlier this year to the way it calculates pension liabilities. In April, Moody’s announced it would adjust pension debt using a long term bond index rate, a discount rate that would likely result in rates of return smaller than the 7 to 8 percent assumption over 30 years that most governments use in calculating their pension liabilities. The Governmental Accounting Standards Board (GASB) has also taken steps that have the effect of highlighting unfunded liabilities previously hidden in government financial reports. Beginning this year, net pension obligations must now be included as a liability on governments’ balance sheets. Governments should also use what GASB considers a more reasonable discount rate – one that more accurately reflects the current rate of return (generally between 3 and 6 percent for most funds) rather than the higher, historic rate of return.
________________________________________________
Remember, I have been telling you for two years there is an economic crash coming that will be bigger than 2008 and it will be the bond bubble? THAT IS WHY YOUR NEO-LIBERAL HAS USED CREDIT BONDS AND TIFs .......TO BREAK THE PUBLIC BUDGETS!

So, in Baltimore we have to go to court to stop a $1 billion school building fund that will cause massive harm to the public schools in the city and cost residents billions in higher interest rates than is being sold to the public now.  THIS IS PUBLIC MALFEASANCE I TOLD THE CITY SOLICITOR......

YES, HE SAID, IT IS!
What happens when this bond deal happens after a massive economic collapse?  The state/city defaults on its share of the funding.....the investors simply by a CDS for the bonds that will crash....and interest rates will climb from near 0 to 2-3%.  That represents billions of dollars in financing only.  Remember, it was O'Malley's claim to fame that he tied the city and state with billions of dollars through Wall Street financial instruments during the financial frauds of the 2000s....this is a new decade.

Stocks are about to plunge, Wells Fargo warns
By Alex Rosenberg | CNBC – Fri, Sep 20, 2013 7:24 AM EDT

Gina Martin Adams is sticking to her guns.

The Wells Fargo strategist has been bearish on stocks all year, even as she watched the S&P 500 (^GSPC) add 21 percent. And on Thursday's " Futures Now ," Adams reiterated her call that the index would close out the year at 1,440.

"Our target is based on fundamentals," Adams insisted. "We're basing our target on typical valuation measures, given the level of interest rates and also on earnings forecasts. And that's why our target is relatively low."

In fact, "low" is somewhat of an understatement. Adams' target implies that the market will drop 16 percent in little more than three months, erasing everything that stocks gained after the year's first day of trading. This makes her one of the lone bears on the Street.


So what could produce such a dismal fourth quarter for stocks? First of all, Adams is highly skeptical about the rally that the market has enjoyed thus far.

"It's all about emotion at this point. The entirety of the S&P 500's increase this year has come via the multiple," Adams said. "It's been simply through the amount that investors are willing to bid up the value of the future earnings stream."

Indeed, the S&P 500's price-earnings multiple has risen from 17 on Jan. 1 to nearly 20. That means the market has largely been rising due to investors' willingness to pay more for those earnings.

Adams goes on to argue that the recent rise in Treasury yields could put an end to this inclination.

"The multiple is one of the most valuable components" of the rally, and "typical drivers of the multiple are interest rates." So despite the fact that yields have cooled off recently, "simply the fact that we moved from 1.6 [percent] on the 10-year Treasury rate to now the 2.7 [percent] range is a potential tremendous shock over the next six months," Adams contended.

Adams believes that stocks haven't yet digested the rate rally. "Stocks tend to follow rates over time," she said. "Typically, when you get a 100 basis point [or 1 percent] move in Treasury rates, you get a contraction on the P/E multiple on stocks of about a full turn. That, by itself, implies you get something of a 10-percent-plus correction in stocks."

And while the Fed's decision that it wouldn't slow its rate of asset purchases has driven the market to yet another all-time high this week, Adams doesn't believe the surprising announcement will ultimately make a difference.

"Unless bonds can actually rally substantially with the so-called Fed bid, and the Fed is able to manipulate yields significantly lower, the damage has been done, and I think the cat is quite frankly out of the bag."

Couple the rise in rates with slow earnings growth, and Adams believes the market is in for a very tricky fall.

"We're going to have to face the music come October," she said.

____________________________________________________

Below you see a package that any raging corporate politician would love.....what wonderful movement of public schools into private hands!   Aren't they clever!  It is true they have made an absolute mess of our schools.,...school choice and Teach for America does that.  BUT THESE AMBITIOUS POLS WANT TO HAND OUR SCHOOL BUILDINGS OVER TO WALL STREET BECAUSE THE GOAL IS TO MAKE EACH SCHOOL A PRIVATE BUSINESS!  What better way than to load the schools with tons of debt just as the economy is ready to crash!

HOW FULL OF MALFEASANCE AND FRAUD!


Remember, we can rebuild all schools in Baltimore and more by simply recovering billions in financial fraud still owed Baltimore by Wall Street.  These pols say....NO...WE PREFER TO HAND BILLIONS MORE OF DEBT AND INTEREST RATE PAYMENTS TO WALL STREET PROFITS!


Rebuilding schools, rebuilding BaltimoreThousands are choosing city life; if we build better schools, they will stay

February 04, 2013|By Tom Wilcox, Wes Moore and Tom Bozzuto

Over the last 10 years leaders from the private, public and nonprofit sectors have begun to transform Baltimore's approach to its future. Traditional public subsidies have given way to strategic investments and tough decisions, using market-based techniques to reform our schools, rebuild our population, and make our neighborhoods safe, clean, green and vibrant.

Now, the General Assembly must do its part to strengthen the city's future by passing legislation to reshape how the city makes improvements to its public school buildings. The city's plan is straightforward and achievable: act aggressively now to build or rebuild our school buildings and give every child in the city a welcoming school environment that will help engage them in learning.

It is a proposal that will help kids, create a stronger school system, bolster the city's prospects for growth and benefit the entire state.

Legislators must be reminded that Baltimore has already taken many hard steps to improve its educational system. A "choice" system gives middle and high school students the opportunity to "vote with their feet," with dollars following those students to the best-performing schools. A union contract sets a national standard for holding teachers and principals accountable for their students' performance. And focused initiatives have increased the high school graduation rate and the number of preschoolers who are "ready for school." And schools that fail to meet increasingly rigorous standards are being closed.

These steps and more show that our civic and private leaders are serious about creating great schools that will change the trajectory of inner-city youth while attracting the middle class families necessary to any city's success.

Now, the focus is on providing a physical environment in Baltimore schools comparable to that in schools across Maryland. The legislative proposal to revamp the school system's capital process would lead to major and accelerated improvements in our school buildings, benefiting kids, teachers, staff and families.

The school system has done its homework, commissioning a study that put a price tag on infrastructure needs in every school building in Baltimore, and it has developed a plan that would shutter buildings, cut or merge programs, and renovate or rebuild 136 buildings.

The city schools bond financing plan to rebuild its inadequate infrastructure may be the best opportunity that Baltimore has had in a generation to cement its revitalization. Under the plan, an independent entity would be created to borrow significant funding through a bond issue to jump-start much-needed capital improvements, and use state and local funding to repay the bonds. It's important to note that the plan requires no extra money from the state, just a commitment to stand by current annual commitments. The timing is perfect. Interest rates are low; construction costs are manageable.

This effort in the General Assembly must be viewed not simply as a bricks-and-mortar educational initiative. Rather, it is part of a comprehensive effort to push for major changes that can move Baltimore forward and restore the city's role as an economic engine for Maryland.

The signs of momentum are apparent, whether it's ongoing downtown development, the bustling rental market driven by young professionals' interest in city life, or the emerging high-tech economy fueled by robust educational, medical and federal institutions. Across the city, private sector initiatives such as Healthy Neighborhoods Inc. are reestablishing "middle neighborhoods" that have wonderful assets but need a boost to continue to strengthen.

The bottom line is that thousands are choosing city life. If we can improve the schools they will stay. These young people can, by themselves, fulfill Mayor Rawlings-Blake's modest goal of attracting or developing 10,000 new taxpaying citizens.

The nonprofit Teach For America already pledged to fulfill 10 percent of the mayor's goal by helping their teachers engage in neighborhood leadership opportunities as they develop lasting ties with our city.

Such commitments from the nonprofit sector must be met by similarly ambitious initiatives from the public sector that enhance city life and build a business-friendly environment.

We have pressing goals: reducing crime, building a better transportation infrastructure that supports employment opportunities, and fostering an energetic business environment. But perhaps overriding them all is the need for a strong school system that will attract new families and new employers.

There is more hard work ahead to capitalize on the educational progress already achieved, but we can take a major step forward right now by changing how we build our schools.

A quarter century ago, state leaders overcame a host of issues to finance and build not one but two stadiums, leading to the winning seasons we now celebrate. Surely we can come together now to give our youth and our city and state the future they deserve.

Tom Wilcox is President of the Baltimore Community Foundation. Wes Moore is a best-selling author and host on the OWN television network. Tom Bozzuto is Chairman and CEO of the Bozzuto Group. All are trustees of the Baltimore Community Foundation.






0 Comments

Post Title.

4/23/2012

0 Comments

 
This is what IMF Christine Lagarde needs to hear from our journalists.  The idea that we are living in a time when our own government works criminally to aid and abet this massive fraud is unbelievable.  The fact that more people aren't out in the street protesting is also remarkable.  In Europe, they are used to revolutions...Americans have rested on their laurels long enough.

I spoke with a Maryland Congressman with a close connection to the story below.  It was his father who wrote and sponsored the law to which the subject of this interview refers......John Sarbanes....of the 'Sarbanes-Oxley Act'.  His father wrote this law to protect people from the likes of Enron and the Savings and Loan Crisis....he wrote it just for this massive mortgage fraud.  It makes any corporate executive signing an accounting report on the state of the company personally and criminally responsible for fraud when found the accounting to be false.  Which is the case with all executives in all these Wall Street banks.  That alone would put these executives in jail, but the Justice Department and the SEC will not do it.

I stood beside John Sarbanes at a campaign event and I asked him why he was not shouting loudly and strongly for the American people as his father did and calling for Sarbanes-Oxley to be enforced.  His response - 'that's my father bill, not mine'.
 

This Sixty Minutes program is a follow-up on the movie "Inside Job"

The following script is from "The Case Against Lehman" which originally aired on April 22, 2012. Steve Kroft is the correspondent. James Jacoby and Michael Karzis, producers.


On September 15, 2008, Lehman Brothers, the fourth largest investment bank in the world, declared bankruptcy -- sparking chaos in the financial markets and nearly bringing down the global economy. It was the largest bankruptcy in history -- larger than General Motors, Washington Mutual, Enron, and Worldcom combined. The federal bankruptcy court appointed Anton Valukas, a prominent Chicago lawyer and former United States attorney to conduct an investigation to determine what happened.


Included in the
nine-volume, 2,200-page report was the finding that there was enough evidence for a prosecutor to bring a case against top Lehman officials and one of the nation's top accounting firms for misleading government regulators and investors. That was two years ago and there have been no prosecutions. Anton Valukas has never given an interview about his report until now.

Steve Kroft: This is the largest bankruptcy in the world. What were the effects?

Anton Valukas: The effects were the financial disaster that we are living our way through right now.

Steve Kroft: And who got hurt?

Anton Valukas: Everybody got hurt. The entire economy has suffered from the fall of Lehman Brothers.

Steve Kroft: So the whole world?

Anton Valukas: Yes, the whole world.

When Lehman Brothers collapsed, 26,000 employees lost their jobs and millions of investors lost all or almost all of their money, triggering a chain reaction that produced the worst financial crisis and economic downturn in 70 years. Anton Valukas' job was to provide the bankruptcy court with accurate, reliable information that the judges could use to resolve the claims of creditors picking over Lehman's corpse.

Steve Kroft: Had you ever done anything like this before?

Anton Valukas: I've never done anything like Lehman Brothers. I don't think anybody else has ever done anything like Lehman Brothers.

Steve Kroft: So your job, I mean, in some ways, your job was to assess blame?

Anton Valukas: Our job is to determine what actually happened, put the cards face up on the table, and let everybody see what the facts truly are.

Valukas' team spent a year and a half interviewing hundreds of former employees, and pouring over 34 million documents. They told of how Lehman bought up huge amounts of real estate that it couldn't unload when the market went south -- how it had borrowed $44 for every one it had in the bank to finance the deals -- and how Lehman executives manipulated balance sheets and financial reports when investors began losing confidence and competitors closed in.

Steve Kroft: Did these quarterly reports represent to investors a fair, accurate picture of the company's financial condition?

Anton Valukas: In our opinion, they did not.

Steve Kroft: And isn't that against the law?

Anton Valukas: It certainly, in our opinion, was against civil law if you will. There were colorable claims that this was a fraud, yes.

By colorable claims Valukus means there is sufficient evidence for the Justice Department or the Securities and Exchange Commission to bring charges against top Lehman executives, including CEO Richard Fuld, for overseeing and certifying misleading financial statements, and against Lehman's accountant, Ernst and Young, for failing to challenge Lehman's numbers.
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WE CERTAINLY HAVE SPACE FOR THESE WALL STREET CRIMINALS IN OUR NEW PRIVATE PRISON BUBBLE......RIGHT BESIDE THE POOR PEOPLE THEY FORCED INTO POVERTY AND A CRIMINAL EXISTENCE
April 22, 2012 9:23 AM   The cost of a nation of incarceration  (CBS News) Is it fair to call the United States the "incarceration nation"? That's what some experts say. And even some veteran law enforcement and correction officials think something's gone wrong. Our Cover Story is reported now by Martha Teichner: At the Gadsden County Jail near Tallahassee, Fla., there are bunks, and mattresses on the floor. The jail has a capacity of about 150 inmates, but there are presently 230 inmates in the facility right now. Walter McNeil, president of the International Association of Chiefs of Police, sees the same story everywhere he goes in the U.S.     In one "pod" of Gadsen jail, in which there are 24 bunks, there are 28 inmates - and by the time the weekend comes, there will be five or six more inmates. That's nothing compared to California. Overcrowding was so bad there, the U.S. Supreme Court called it "cruel and unusual punishment," and last May ordered the state to cut its prison population by more than 30,000. Nationwide, the numbers are staggering: Nearly 2.4 million people behind bars, even though over the last 20 years the crime rate has actually dropped by more than 40 percent. "The United States has about 5 percent of the world's population, but we have 25 percent of the world's prisoners - we incarcerate a greater percentage of our population than any country on Earth," said Michael Jacobson, director of the non-partisan Vera Institute of Justice. He also ran New York City's jail and probation systems in the 1990s. A report by the organization, "The Price of Prisons," states that the cost of incarcerating one inmate in Fiscal 2010 was $47,421 per year. "In states like Connecticut, Washington state, New York, it's anywhere from $50,000 to $60,000," he said. Yes - $60,000 a year. That's a teacher's salary, or a firefighter's. Our epidemic of incarceration costs us taxpayers $63.4 billion a year. The explosion in incarceration began in the early 1970s - the political response to an explosion in urban violence and increased drug use. "So 'Tough on crime,' 'three strikes, you're out,' 'Let 'em rot, throw away the key' - all that stuff resulted in more mandatory sentencing, longer and longer sentencing," said Jacobson

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    Cindy Walsh is a lifelong political activist and academic living in Baltimore, Maryland.

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