Skip to main content

View Diary: America's 'Madoff' Banking and Financial System... (10 comments)

Comment Preferences

  •  Absolutely no argument . . . (0+ / 0-)

    at least one that made any sense what so ever.

    In the choice between changing ones mind and proving there's no need to do so, most people get busy on the proof.

    by jsfox on Fri Apr 10, 2009 at 10:46:24 AM PDT

    [ Parent ]

    •  Fiduciary breach, embezzlement, misapplication (2+ / 0-)
      Recommended by:
      ganymeade, Fossil

      to name a few, and this short list excludes just plain ol' firing of these 'geniuses' as a corrective, disciplinary action - a la Rick Wagoner's firing.

      Some definitions enclosed below.

      Fiduciary (source:

      A fiduciary duty is an obligation to act in the best interest of another party. For instance, a corporation's board member has a fiduciary duty to the shareholders, a trustee has a fiduciary duty to the trust's beneficiaries, and an attorney has a fiduciary duty to a client.

      A fiduciary obligation exists whenever the relationship with the client involves a special trust, confidence, and reliance on ithe fiduciary to exercise his discretion or expertise in acting for the client. The fiduciary must knowingly accept that trust and confidence to exercise his expertise and discretion to act on the client's behalf.

      When one person does agree to act for another in a fiduciary relationship, the law forbids the fiduciary from acting in any manner adverse or contrary to the interests of the client, or from acting for his own benefit in relation to the subject matter. The client is entitled to the best efforts of the fiduciary on his behalf and the fiduciary must exercise all of the skill, care and diligence at his disposal when acting on behalf of the client. A person acting in a fiduciary capacity is held to a high standard of honesty and full disclosure in regard to the client and must not obtain a personal benefit at the expense of the client.

      Embezzlement, Misapplication, et al (source:

      US Code,Section 656. Theft, embezzlement, or misapplication by bank officer or employee

           Whoever, being an officer, director, agent or employee of, or
         connected in any capacity with any Federal Reserve bank, member
         bank, depository institution holding company, national bank,
         insured bank, branch or agency of a foreign bank, or organization
         operating under section 25 or section 25(a) (!1) of the Federal
         Reserve Act, or a receiver of a national bank, insured bank,
         branch, agency, or organization or any agent or employee of the
         receiver, or a Federal Reserve Agent, or an agent or employee of a
         Federal Reserve Agent or of the Board of Governors of the Federal
         Reserve System, embezzles, abstracts, purloins or willfully
         misapplies any of the moneys, funds or credits of such bank,
         branch, agency, or organization or holding company or any moneys,
         funds, assets or securities intrusted to the custody or care of
         such bank, branch, agency, or organization, or holding company or
         to the custody or care of any such agent, officer, director,
         employee or receiver, shall be fined not more than $1,000,000 or
         imprisoned not more than 30 years, or both; but if the amount
         embezzled, abstracted, purloined or misapplied does not exceed
         $1,000, he shall be fined under this title or imprisoned not more
         than one year, or both.

           As used in this section, the term "national bank" is synonymous
         with "national banking association"; "member bank" means and
         includes any national bank, state bank, or bank and trust company
         which has become a member of one of the Federal Reserve banks;
         "insured bank" includes any bank, banking association, trust
         company, savings bank, or other banking institution, the deposits
         of which are insured by the Federal Deposit Insurance Corporation;
         and the term "branch or agency of a foreign bank" means a branch or
         agency described in section 20(9) of this title. For purposes of
         this section, the term "depository institution holding company" has
         the meaning given such term in section 3 of the Federal Deposit
         Insurance Act.

Subscribe or Donate to support Daily Kos.

Click here for the mobile view of the site