Rolling Stone reporter Matt Taibbi exposes what we've always known: Wall Street is above the law.
Nobody goes to jail. This is the mantra of the financial-crisis era, one that saw virtually every major bank and financial company on Wall Street embroiled in obscene criminal scandals that impoverished millions and collectively destroyed hundreds of billions, in fact, trillions of dollars of the world's wealth — and nobody went to jail.
If you are poor, middle class, black and you commit even a minor offense there is a very good chance you're going to jail. America has become a virtual prison state with the prison population DOUBLING since 1985. (more)
However, if you are rich and well connected and rip off poorer people, jail is not in your future.
and nobody went to jail. Nobody, that is, except Bernie Madoff, a flamboyant and pathological celebrity con artist, whose victims happened to be other rich and famous people.
Everything is different on Wall Street - two accounting books and two legal systems. One for them and one for us.
Not a single executive who ran the companies that cooked up and cashed in on the phony financial boom — an industrywide scam that involved the mass sale of mismarked, fraudulent mortgage-backed securities — has ever been convicted. Their names by now are familiar to even the most casual Middle American news consumer: companies like AIG, Goldman Sachs, Lehman Brothers, JP Morgan Chase, Bank of America and Morgan Stanley. Most of these firms were directly involved in elaborate fraud and theft.
Not one. Literally nobody! Even though their crimes are well known.
Lehman Brothers hid billions in loans from its investors. Bank of America lied about billions in bonuses. Goldman Sachs failed to tell clients how it put together the born-to-lose toxic mortgage deals it was selling. What's more, many of these companies had corporate chieftains whose actions cost investors billions — from AIG derivatives chief Joe Cassano, who assured investors they would not lose even "one dollar" just months before his unit imploded, to the $263 million in compensation that former Lehman chief Dick "The Gorilla" Fuld conveniently failed to disclose.
The most these CRIMINALS face are fines but guess what? They don't even pay what little fines they get!
To add insult to injury, the people who actually committed the crimes almost never pay the fines themselves; banks caught defrauding their shareholders often use shareholder money to foot the tab of justice.
And oh yeah for the Bailout Banks... that money is TAXPAYER MONEY... they pay us back with our own money!
But surely the regulators will protect us:
a veritable mountain of evidence indicates that when it comes to Wall Street, the justice system not only sucks at punishing financial criminals, it has actually evolved into a highly effective mechanism for protecting financial criminals. This institutional reality has absolutely nothing to do with politics or ideology — it takes place no matter who's in office or which party's in power...the shocking pattern of nonenforcement with regard to Wall Street is so deeply ingrained in Washington that it raises a profound and difficult question about the very nature of our society: whether we have created a class of people whose misdeeds are no longer perceived as crimes, almost no matter what those misdeeds are.
Equal Justice Under the Law? You must be joking. Just ask the former CHIEF ACCOUNTANT for the SEC:
Lynn Turner, a former chief accountant for the SEC, laughs darkly at the idea that the criminal justice system is broken when it comes to Wall Street. "I think you've got a wrong assumption — that we even have a law-enforcement agency when it comes to Wall Street," he says.
Taibbi continues, showing
smoking gun evidence that Joe Cassano of AIG, John Mack of Morgan Stanley and others have
broken the law and made millions doing it.
Oh particular note is Robert Khuzami director of enforcement at the SEC who was caught telling Wall Street lawyers at a retreat how to bypass the legal process:
Khuzami, the SEC's director of enforcement, talked about a new "cooperation initiative" the agency had recently unveiled, in which executives are being offered incentives to report fraud they have witnessed or committed. From now on, Khuzami said, when corporate lawyers like the ones he was addressing want to know if their Wall Street clients are going to be charged by the Justice Department before deciding whether to come forward, all they have to do is ask the SEC.
It's called corruption folks.
Khuzami was basically outlining a four-step system for banks and their executives to buy their way out of prison.
This is such open corruption even a REPUBLICAN Senator had to object:
when Sen. Chuck Grassley found out about Khuzami's comments, he sent the SEC a letter noting that the agency's own enforcement manual not only prohibits such "answer getting," it even bars the SEC from giving defendants the Justice Department's phone number. "Should counsel or the individual ask which criminal authorities they should contact," the manual reads, "staff should decline to answer, unless authorized by the relevant criminal authorities."
And of course our President, hope and change and rainbows:
As for President Obama, what is there to be said? Goldman Sachs was his number-one private campaign contributor. He put a Citigroup executive in charge of his economic transition team, and he just named an executive of JP Morgan Chase, the proud owner of $7.7 million in Chase stock, his new chief of staff.
But this problem didn't begin with Obama and all signs indicate it won't end/be at all curbed by the Obama Administration:
The mental stumbling block, for most Americans, is that financial crimes don't feel real; you don't see the culprits waving guns in liquor stores or dragging coeds into bushes. But these frauds are worse than common robberies. They're crimes of intellectual choice, made by people who are already rich and who have every conceivable social advantage, acting on a simple, cynical calculation: Let's steal whatever we can, then dare the victims to find the juice to reclaim their money through a captive bureaucracy..when the state simply gives up on the notion of justice — this whole American Dream thing recedes even further from reality.
Hey, it's the FIRE economy! Burn baby burn.