WE ALSO KNOW THAT THE GOVERNMENT ACCOUNTABILITY ORGANIZATIONS PROJECT THAT AS MANY AS 3/4 OF CITIZENS IN PUERTO RICO HAVE BEEN ON SOCIAL SECURITY DISABILITY AND NOW WE HEAR THE STATISTIC OF A 20% INCREASE IN SOCIAL SECURITY DISABILITY CLAIMS THESE FEW YEARS OF THE RECESSION AS MILLIONS OF UNEMPLOYED LOSING THEIR EMPLOYMENT BENEFITS APPLY FOR DISABILITY TO SURVIVE. POLITICIANS THINK IT IS GREAT TO BLOW THIS ENTITLEMENT OUT OF THE WATER RATHER THAN HAVE THE BANKS PAY FOR THEIR CRIMES ALL OF THIS WHILE THIRD WAY DEMOCRATS USE THE PAYROLL TAXES AS A TOOL TO REDUCE TAXES ON THE MIDDLE-CLASS. REDUCING PAYROLL TAXES REDUCES INPUT INTO THE ENTITLEMENT AND SOCIAL SECURITY FUNDS BURDENING THESE PROGRAMS EVEN MORE.
THIS POLICY IS DELIBERATE AND IS MEANT TO IMPLODE THESE PROGRAMS. THIRD WAY CORPORATE POLITICIANS ARE NOT BEING FORCED BY THE TEA PARTY TO FIGHT FOR PAYROLL TAX REDUCTIONS. TEA PARTY PEOPLE AREN'T FORCING YOUR MARYLAND INCUMBENT TO BE SILENT ABOUT THE LEVEL OF FRAUD KILLING SOCIAL SECURITY DISABILITY OR TO BE SILENT ON THE FAILURE TO BRING TRILLIONS OF DOLLARS IN FRAUD BACK TO OUR STATE AND LOCAL COFFERS TO REPLACE THE LOSSES.
DO YOU HEAR YOUR LOCAL MEDIA TALKING TO YOU ABOUT ALL THESE EVENTS AND BAD PUBLIC POLICY? THEY ARE CAPTURED AND WE NEED TO DEMAND THEY RETURN TO BEING JOURNALISTS AND NOT MOUTHPIECES! THEY WILL SIMPLY CONTINUE IF YOU DO NOT SHOUT LOUDLY AND STRONGLY AGAINST THIS.
ARE YOU WRITING, CALLING, EMAILING, AND ATTENDING RALLIES? ARE YOU COMMENTING TO MEDIA AND INSTITUTIONS FAILING TO WORK IN PUBLIC BEHALF?
VOTE YOUR INCUMBENT OUT OF OFFICE!!!!!
WE SEE BELOW THAT SOME NOISE IS STARTING TO SURFACE. IT IS LATE, BUT IT WILL NOT BE EFFECTIVE IF ALL OF US DO NOT GET OUT AND SPREAD THE WORD!
BELOW WE SEE A SYMPOSIUM THAT ADDRESSES MUCH OF WHAT I SPEAK. IT WAS ANNOUNCED THE DAY OF THE EVENT DO THERE ISN'T MUCH CHANCE OF ANYONE OTHER THAN THOSE LOOKING AT THE WYPR WEBSITE WILL KNOW ABOUT IT. THE SAME WENT FOR THE LECTURE BY CORNEL WEST AT MARYLAND INSTITUTE OF THE ARTS ON LOSS OF CIVIL LIBERTIES.
WE ARE SEEING A DIRECT ATTEMPT TO KEEP MOST PEOPLE OUT OF THE INFORMATION LOOP. A BLOGGER LIKE ME CANNOT OF COURSE PERUSE EVERY INSTITUTION'S CALENDAR FOR EVENTS AND AS I AM ACTIVELY LOOKING FOR THESE EVENTS, YOU CAN SEE THE NEED FOR CHANGE IN HOW INFORMATION IS DISSEMINATED IN THE CITY.
I AM GLAD TO SEE A PROGRESSIVE SPEAKER AND SEE IT AT THE MARYLAND LAW SCHOOL. THIS LAW SCHOOL HAS BEEN MORE AGGRESSIVE ON SOCIAL ISSUES THAN OTHERS IN THE AREA AND WE THANK THEM FOR THIS OPPORTUNITY. I WILL SAY THEY WAITED TO PRESENT THIS SYMPOSIUM UNTIL AFTER MOST OF THE STATUTES OF LIMITATION EXPIRED ON THE FRAUDS AND AFTER ALL THE POLITICIANS INVOLVED IN THE CONSPIRACY ARE SET TO RUN AGAIN FOR REELECTION.
THIS WAS DELIBERATE!
The Maryland Law Review and Center for Progressive Reform
In Collaboration with the Center for Health and Homeland Security and
the Environmental Law Program
The 2012 Ward Kershaw Symposium
Too Big to Jail: The Roadblocks to Regulatory Enforcement
The Maryland Law Review will host the 2012 Ward Kershaw Symposium, "Too Big to Jail: The Roadblocks to Regulatory Enforcement," which will address the failure of the regulatory system to respond to the housing crisis, the BP oil spill, and other disasters in a proactive and effective manner. The regulatory system is meant to ensure that statutes enacted to improve quality of life and protect against potential dangers are fairly, efficiently, and effectively enforced across the country. From the mundane to the arcane, the regulatory system touches almost every aspect of modern life: banking, workplace safety, environmental protection, taxes, social security, food safety, the availability of medicine, natural disaster response, and many more. It is no surprise then, that when a disaster occurs, the media, politicians, and the public are quick to ask: where were the regulators? This question has only become more meaningful in recent years as incidents like the housing collapse, the BP oil spill, the Big Branch Mine Collapse, and salmonella outbreaks in multiple types of food have not resulted in many, if any, consequences from regulators. In light of these problems, this symposium will bring together scholars, practitioners, and regulators from different regulatory areas: health and safety, labor, banking, finance, and the environment, to discuss potential solutions to the current regulatory mess.
Schedule of Events:
Thursday, September 20th Ceremonial Courtroom
5:00pm - 6:00pm Keynote Address: Brooksley Born, Former Chairwoman of the Commodities Futures Trading Commission (CFTC) and Retired Partner at Arnold & Porter
6:00 - 7:00 PM Light reception in Atrium
7:00 PM - ?? Speakers' Dinner
Friday, September 21st Krongard Room
8:15am - 9:00am Continental Breakfast
9:00am - 9:15am Introduction and Welcome
9:15am - 10:15am Identifying the Roadblocks to Regulatory Enforcement
Moderator: Rena Steinzor,
Professor of Law, Univ. of Maryland Carey Law
Presenters: Michael Greenberger,
Law School Professor, Univ. of Maryland Carey Law
President, Public Citizen
Joe R. and Teresa Lozano Long Endowed Chair in
Administrative Law, University of Texas School of Law
10:15am - 12:00pm Regulatory Enforcement and the Financial Regulatory
Moderator: Michael Greenberger,
Law School Professor, Univ. Maryland Carey Law
Presenters: Lynn Stout,
Distinguished Professor of Corporate and Business Law,
Clarke Law Institute, Cornell Law School
Arthur E. Wilmarth, Jr.,
Professor of Law & Executive Director, Center for Law,
Economics & Finance (C-LEAF), George Washington
University Law School
Associate Professor of Economics and Law at the
University of Missouri – Kansas City
Wallace C. Turbeville,
Senior Fellow, Demos
Meyer “Mike” Eisenberg,
Visiting Professor of Law, Willamette Univ. College of Law
12:00 - 12:15pm Break
12:15pm – 1:00pm Lunch
1:00 - 1:15pm Break
1:15pm - 3:00pm Enforcing Health, Safety, and Environmental
Moderator: Jane F. Barrett,
Law School Professor and Director, Environmental Law Clinic,
Univ. of Maryland Carey Law
Presenters: Brian Wolfman, Visiting Professor and Co-Director,
Institute for Public Representation,
Georgetown University Law Center
Jeffrey F. Liss Professor from Practice, Director, Environmental
Law and Policy Program, Univ. of Michigan Law School
W. Warren Hamel,
Partner, Venable LLP
General Counsel, National Oceanic and Atmospheric
Tom & Elizabeth Taft Distinguished Professor of Environmental
Law, Director, Center for Law, Environment, Adaptation and
Resources (CLEAR), Univ. of North Carolina Chapel Hill School of
3:00pm - 3:15pm Wrap Up
Please contact conference coordinator, Brendan Hogan for more information. ______________________________________________
THIS IS AN ARTICLE THAT STATES VERY SIMPLY THAT THE FAILURE TO PROSECUTE AND EXACT MEANINGFUL FINANCIAL PENALTIES WILL BECOME THE NORM BECAUSE PEOPLE ARE NOT SHOWING THEIR OUTRAGE. IF THIS IS ALLOWED TO STAND, WE WILL HAVE A SOCIETY WHERE IT IS IMPOSSIBLE FOR THE MIDDLE-CLASS TO MAINTAIN ITSELF AS FRAUD DIRECTLY HITS THEIR ASSETS AND BOOM AND BUST FROM THE FRAUD KILLS THE ECONOMY OVER AND AGAIN.
STAND UP AND FIGHT BACK!!!!
VOTE YOUR INCUMBENT OUT OF OFFICE!!
Deferred Prosecution Agreements and Cookie-Cutter Justice
By PETER J. HENNINGCarolyn Kaster/Associated Press
Lanny A. Breuer, the head of the Justice Department’s criminal division.Lanny A. Breuer, the head of the Justice Department’s Criminal Division, last week spoke to the New York City Bar Association, extolling the virtues of deferred and nonprosecution agreements as the new standard for how the Justice Department deals with criminal conduct by corporations.
It is not just corporate investigations that are being concluded with these agreements. They have been used recently with individuals to resolve investigations, like the recent agreement with the cyclist Floyd Landis over possible fraud charges. The Securities and Exchange Commission has also embraced them as a means to wrap up civil securities fraud cases.
But are these agreements all they are cracked up to be as an enforcement tool? Or do they let corporations off too easily? Like anything in the world of white-collar crime, there are good reasons to use them, but questions remain about whether they should be the norm for policing corporate misconduct.
Deferred and nonprosecution agreements are contracts with the government in which a company (or individual) undertakes specified actions in exchange for charges being dismissed or not filed altogether. The terms usually require payment of a fine, continued cooperation with any investigations or trials and a commitment to enhance internal controls. If the agreement is breached, the agreement typically permits prosecutors to restart the case and use any admissions by the company in the a subsequent proceeding.
A significant advantage to these agreements is that there is no judicial involvement, so the Justice Department does not have to worry about a judge second-guessing its terms or questioning the fairness of the resolution.
Mr. Breuer stated that the growing use of these agreements had meant “unequivocally, far greater accountability for corporate wrongdoing – and a sea change in corporate compliance efforts.” He pointed to the recent agreement with Barclays over manipulation of the London interbank offered rate, or Libor, as an example of how companies pay a heavy price when the settle, citing the replacement of the bank’s top management.
But a close look at the Barclays settlement does not show the Justice Department being as tough as advertised. The only discussion of the involvement of senior managers is buried in the press release with a bland reference that “members of Barclays management directed that Barclays’s Dollar Libor submissions be lowered.”
There was no specific mention of the former chief executive, Robert E. Diamond Jr., or the chief operating officer, Jerry del Missier, who lost their positions only after significant pressure from the British Parliament, not the Justice Department.
The promised accountability from the agreements does not always mean companies will be completely reformed. James B. Stewart of The New York Times, in a column in July, discussed multiple settlements by the Swiss bank UBS with the government for violations, including receiving immunity in the Libor investigation, which seem “to have had scant, if any, deterrent effect.”
Deferring charges is nothing new in the criminal justice system. Many drug- and alcohol-related prosecutions of first-time offenders permit the dismissal of a case when the person completes treatment. The juvenile justice system often uses diversion programs to allow offenders to avoid punishment through education and counseling.
The pivotal event in the rise of deferred and nonprosecution agreements in the corporate context was the demise of accounting firm Arthur Andersen, whose conviction for obstruction of justice in 2002 was later reversed by the Supreme Court. Thousands of employees lost their jobs because of conduct in firm’s Houston office related to its auditing work on behalf of Enron.
Mr. Breuer acknowledged that he had heard, and responded to, companies bemoaning the potential effects of a criminal prosecution on innocent employees and financial markets – the specter of Arthur Andersen. He frankly acknowledged that “Sometimes – though, let me stress, not always – these presentations are compelling.”
Companies facing potential criminal charges know they need to argue that a criminal conviction would be just this side of Armageddon, making sure to highlight the threat of lost jobs and economic turmoil to persuade prosecutors to give a deferred or nonprosecution agreement.
And those arguments certainly seem to work for publicly traded companies. This year, there have been 20 deferred and nonprosecution agreements so far, and over 150 since 2007.
Mr. Breuer is certainly right when he points out that criminal charges are not a very useful means of regulating corporations, so that prosecutors “sometimes had to use a sledgehammer to crack a nut. More often, they just walked away.”
Deferred and nonprosecution agreements allow for a more nuanced approach that extracts a penalty and imposes conditions on a company that are similar to the punishment it would receive from a conviction, but without all of the collateral consequences.
But use of the “sledgehammer” seems to have largely disappeared, so that a full-scale prosecution of a large corporation is at best a rarity. The banks caught up in the Libor investigation can certainly expect to settle with the Justice Department and other regulators, using the Barclays agreement as the template for resolving the case.
It seems as if we are coming perilously close to cookie-cutter justice in corporate criminal investigations. Everyone by now knows the drill: turn over the results of an internal investigation, highlight how damaging a conviction would be and then offer to pay the fine and put in place an enhanced compliance program. The press release almost writes itself, but it is the rare case in which senior management pays any price.
Deferred and nonprosecution agreements are here to stay because they give the Justice Department a means to police corporations while mitigating the full impact of the criminal law. They occupy a middle ground between the sledgehammer of criminal charges and giving a company a free pass. Whether they are the unalloyed good that Mr. Breuer portrayed them as is another question.
WE HEAR MORE FROM EUROPEAN JOURNALISM THE SOCIAL UNREST CAUSED BY THESE FINANCIAL CARTEL'S CRIMINAL ACTS AND THE TROIKA.......THE IMF, THE ECB (OR OUR FED), AND BRUSSELS (OUR TREASURY). WHAT IS HAPPENING THERE IS HAPPENING HERE AND THE TAXPAYERS ARE SAYING 'NO' REGARDLESS OF US GEITHNER'S ATTEMPTS TO GET EUROPE TO HAVE TAXPAYERS PAY FOR THE COLLAPSE!
Bank bondholders Burning sensation Taxpayers should not pay for bank failures. So creditors must
Jul 21st 2012 | from the print edition The Economist
“THE only way to deal with moral hazard is to take out bank bondholders and have them shot,” says a hedge-fund manager. By “shot” he is not recommending actual executions, but saying that investors should suffer losses when the banks whose bonds they hold need rescuing. To date during the financial crisis this has been a rarity. Bondholders have been the Scarlet Pimpernels of finance—investors who prove elusive every time a bank’s losses are divided up.
The era of impunity is coming to an end. In the short term some creditors of Spanish banks may be forced to suffer losses as a result of a planned euro-zone rescue of that country’s financial system. Over the longer term regulators in Europe and America are rewriting rules to “bail in” bondholders by converting debt to equity. These moves may have a far-reaching impact on the price banks pay to borrow, and thus on what they end up charging for credit. And the transition to a system designed to protect taxpayers from expensive bail-outs may be a bumpy one.
To understand how bank bondholders ended up in their privileged position, you need to look at the capital structure of banks. Imagine a cake of many layers, each representing the bank’s liabilities. At the very bottom is a thin sliver of costly equity. This is the money that a bank’s shareholders have put into the business. Next comes a layer of “hybrid” or “junior” debt that is supposed to pad out the equity layer but is made of somewhat cheaper ingredients. Above that come various layers of debt that make up the main body of the cake. The thickest slices are bank bonds, or “senior unsecured debt”, and bank deposits. The icing on top is its “secured” debt, such as covered bonds or other loans and derivatives, where creditors can grab hold of assets if their loan is not repaid.
These layers serve two purposes. When money is collected by the bank it is first paid out to those in the upper tranches, usually as fixed-interest payments on deposits or bonds. If anything is left it trickles down to the shareholders. But when losses are incurred, bites are taken out of the cake from the bottom first. In return for taking a chunk of the profits in good times, shareholders get wiped out in bad times.
This system worked very badly in the financial crisis. The first problem was that the equity layer was far too thin, and that banks were wary of imposing losses on holders of hybrid debt. There was not enough loss-absorbing capital in the banks to cope with the losses they incurred. So more equity had to be found.
The second problem was that this money tended to come from taxpayers. Senior bondholders were repaid in full in all but a handful of cases. Ireland is the most egregious example of a country plunging into debt in order to repay its banking system’s bondholders. This was partly for legal reasons: in many countries bank deposits and senior bank debt were in the same layer of the cake, so that one couldn’t take losses without the other also doing so, a politically unthinkable prospect. But the bigger reason was that regulators were terrified that if they imposed losses on bondholders they would cause a wave of panic across the financial system that would hit funding for all banks.
The pendulum has now swung. This is evident in the Spanish bail-out, where euro-zone governments are reluctant to put their own taxpayers’ money at risk while seeing Spanish bondholders and holders of hybrid debt being repaid in full. Holders of the lowest layers of debt in bailed-out banks are likely to see their debt converted into equity and to take losses. This is particularly controversial in Spain, because many of the holders of this type of debt are unsophisticated retail customers: horror stories are emerging of illiterate customers signing up for risk-bearing debt with their thumbprints.
Imposing losses on junior debtholders is one thing; trying to bail in senior bondholders is quite another. In a significant U-turn, the European Central Bank (ECB) has reportedly proposed imposing losses on bondholders in Spanish banks that collapse. That idea was rejected by European finance ministers because they worried it would spook markets.
It is only a matter of time. In Britain, Switzerland and the European Union rules are either now in force or being drafted that will force banks to ensure that at least some of their debt can be turned into equity in a crisis. Some of this debt may take the form of convertible bonds that convert at a specific trigger-point: Credit Suisse issued SFr3.8 billion ($3.9 billion) of this sort of debt on July 18th. Most will be ordinary bank bonds that can be converted by the regulator. Rules empowering the Federal Deposit Insurance Corporation to take over failing American banks achieve much the same result.
Yet imposing losses on bondholders risks unintended consequences. The first is that the cost of bank debt may rise a lot more than it has already. A decade ago big companies paid more to borrow than banks did. Now the opposite is true (see chart). This gap may widen further as investors price in the risk that governments will do all they can to avoid bailing out banks (although higher equity levels, the thicker bottom slice of the cake, also offer bondholders more protection from losses).
A second risk is that senior bank creditors will respond to the potential for losses in a way that makes the system less stable. They may make sure their loans are secured—which in turn increases the losses inflicted on the remaining unsecured creditors and thus the price they will demand. Or they may plump for short-term debt so that they can pull their money out in a flash. Such dangers underpin the case for a gradual transition to a bail-in regime, but do not undermine its desirability. A world in which bank bondholders expect to get shot is one in which taxpayers are safer.
STATISTICS SHOW THAT OVER THIS PAST DECADE ALMOST 3/4 OF THE CITIZENS OF PUERTO RICO WERE ON SOCIAL SECURITY DISABILITY. NOW WE SEE DISABILITY SERVING AS AN EXTENSION OF UNEMPLOYMENT BENEFITS AS PEOPLE STRUGGLE TO SURVIVE. ONCE AGAIN OUR SAFETY NETS ARE BEING DELIBERATELY IMPLODED BY FRAUD AND YOUR INCUMBENT IS JUST LETTING IT HAPPEN. DO YOU HEAR YOUR INCUMBENT SHOUTING LOUDLY AND STRONGLY ABOUT THIS INCESSANT THEFT OF OUR BENEFITS? NO. YOU WILL HEAR HIM/HER TELL YOU THAT BENEFITS WILL HAVE TO BE CUT BECAUSE THE TRUST IS RUNNING OUT. ALL OF MARYLAND'S THIRD WAY DEMOCRATS VOTED FOR THIS DURING THE DEBT CEILING DEBATE.
VOTE YOUR INCUMBENT OUT!!!!!
Report: Disability benefits wrongly awarded
By Sam Baker - 09/18/12 01:37 PM ET The Hill Blog
Lax oversight is leading the government to approve disability benefits for people who can't prove that they're disabled, according to a report released Tuesday by a Senate subcommittee.
The report, spearheaded by Sen. Tom Coburn (R-Okla.), says more than a quarter of disability claims are approved despite inadequate or conflicting information.
That doesn't necessarily mean all of those claims should have been rejected, Coburn said at a hearing Tuesday — but some unfounded approvals are surely slipping through the cracks of an inadequate review process. The report does not address people who might have been wrongly denied disability benefits.
Coburn's report examined 300 approved applications for Social Security disability benefits. Its findings mirror an internal review the Social Security Administration conducted in 2011, which found insufficient reviews in 22 percent of disability determinations made by administrative law judges.
"I think Social Security is right on top of this," Coburn said.
Administrative law judges are under immense pressure to clear away a deep backlog of applications. Coburn's review uncovered examples of judges holding hearings that lasted only 10 minutes, at which the disability recipient didn't even speak. Some judges seemed to overtly ignore evidence indicating that applicants were probably able to return to work.
Coburn recommended a series of changes to the disability system, including updated standards for disability payments and a stronger quality-review process. Sen. Carl Levin (D-Mich.), who leads the investigative subcommittee that produced the report, said he disagreed with just one recommendation: requiring a government representative at all hearings held by administrative law judges.
Because the government wants to cut down on improper payments, leaving more money to help people who are actually in need, a government representative would reduce the number of cases in which judges overlook relevant evidence, Coburn said. Levin said it would be an "expensive and time-consuming duplication."
LET'S BE CLEAR.....OBAMA AND ALL MARYLAND POLITICIANS PLAN TO CUT SOCIAL SECURITY. IT IS THE ONE PROGRAM THAT IS HEALTHY AND IN NEED OF LITTLE ADJUSTMENT. $3 TRILLION WAS SENT TO TREASURY FROM REAGAN'S TIME INSTEAD OF THE TRUST AND WE LOST REVENUE WITH THESE PAYROLL TAX CUTS THESE FEW YEARS. SIMPLY RAISING PAYROLL TAXES A SMALL BIT WILL SET SOCIAL SECURITY ON COURSE.
THERE IS NO NEED TO CUT SOCIAL SECURITY!!!!!
VOTE YOUR INCUMBENT OUT!!!!
Don't Call It 'Raising the Retirement Age,' Because That's Not What They're Doing
Posted on 09/07/2012 by Jim Naureckas 11As Dean Baker noted (Beat the Press, 9/7/12), corporate media mostly missed one of the major pieces of news in President Barack Obama's speech to the Democratic National Convention.
Talking about the federal budget deficit, Obama said, "Now, I’m still eager to reach an agreement based on the principles of my bipartisan debt commission." Then, as he talked about what he would and wouldn't do to reduce the deficit, he included this line: "And we will keep the promise of Social Security by taking the responsible steps to strengthen it–not by turning it over to Wall Street."
"Responsible steps to strengthen it"–what does that mean? Dean Baker helpfully paraphrases:
President Obama implicitly called for cutting Social Security by 3 percent and phasing in an increase in the normal retirement age to 69 when he again endorsed the deficit reduction plan put forward by Erskine Bowles and Alan Simpson, the co-chairs of his deficit commission.
This would be a good thing for voters to know about, wouldn't it?
Baker's blog post explains the 3 percent thing–the result of proposed games with the cost of living adjustment. As for raising the retirement age, that requires further discussion–because that's one of the big lies of the Social Security discussion.
The thing is, nobody who proposes raising the retirement age is really proposing raising the retirement age. If you were just raising the retirement age, you'd have to wait until you were (say) 69 to stop working, but when you did, you get the same benefits that you would now if you retired at age 69.
But no one's proposing that–because that would save hardly any money. The way Social Security works is that you can retire whenever you want starting at age 62–but the longer you wait, the more money you get. The government tries to calculate it based on life expectancy so that whatever date you pick, you end getting (on average) about the same amount of money.
So when they "raised the retirement age"–as they've been in the process of doing for decades now–they didn't say that you couldn't retire at 62 anymore. They said that if you retired at 62, you'd get less money. And you'd get less money if you retired at 63, or 64, or 65, or….
There's a more accurate way than "raising the retirement age" to describe this policy of lowering the amount of money someone at any given age receives when they retire. It's "cutting Social Security benefits."