f Democracy is government “by the people, of the people, and for the people”, corporatocracy is government by the corporation, of the corporation, and for the corporation. In speaking of the corporatocracy, I am referring to large corporations and their interests, the wealthy elite who largely own the corporations, and the politicians who are bought and paid for by those corporations and those wealthy elites. This occasional report will focus on recent items in the news regarding the corporatocracy, and the demonstrating the extent to which our democratic ideals have been largely subverted by the corporatocracy.
Who will you be voting for in 2012: Exxon/BofA or JP Morgan/KBR?
NY – New York State Attorney General Eric Schneiderman, has come under pressure from the Obama administration to agree to a quick settlement with banking and mortgage firms over foreclosure abuses, and to drop his own investigation into such abuses. In recent weeks, officials at HUD and DOJ have waged a campaign to urge the NY AG to support a quick settlement. Schneiderman and top prosecutors from other states have objected to a settlement with mortgage firms, saying it would interfere with their own investigations into mortgage and foreclosure abuses. In addition to determining the extent of foreclosure abuses, such as “robo-signing” foreclosure documents and seizing homes on which the banks did not hold the mortgage, Schneiderman's office is investigating whether banks broke New York State law by not actually owning the mortgages that were bundled into securities and sold publicly. The firms under investigation: JPMorgan Chase, Bank of America, Wells Fargo, Citigroup and Ally Financial, would rather reach a settlement than undergo further investigation, and have been frustrated by Schneiderman. Some sources have claimed that bank officials have met with HUD secretary Shaun Donovan and asked him to intervene with Schneiderman. Under the terms of the settlement, mortgage firms would pay penalties that would go to loan modifications for distressed homeowners, while states AG would agree to broad releases preventing them from bringing future litigation against the banks for fraud and mortgage abuses. With the threat of further investigations off the table, those banks will be willing to offer less in penalties and settlement fees. The Obama administration favors a quick settlement to speed aid to distressed homeowners. Wall St. firms, banks, and mortgage institutions also pay for a large portion of Pres. Obama's election campaigns. (Read more here:http://www.nytimes.com/...
http://www.nytimes.com/...)
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NY – The Hufffington Post reported today that NY Attorney General Eric Sneiderman has been removed from the committee tasked with negotiating a possible settlement agreement with the five largest US mortgage banks. The US government launched the committee earlier this year after widespread abuse of foreclosure laws, such as illegal home seizures, by US mortgage firms became known. Schneiderman is actively pursuing his own investigation into banking foreclosure abuses, and has questioned the push by Obama administration officials to quickly resolve the negotiations before thorough investigation and documentation of the extent of the abuses are completed. Attorney Generals in many states, Schneiderman among them, are complicating a quick settlement of the banking abuses by questioning the need to scuttle the state and federal investigations into those abuses. An email sent to members of the news media by Patrick Madigan in the Iowa AGs office read: “Effective immediately, the New York Attorney General’s Office has been removed from the Executive Committee of the Robosigning multistate." A spokesperson for Schneiderman's office said Schneiderman was removed from the executive committee at the prerogative of Iowa's AG Tom Miller. Said Miller: “New York has actively worked to undermine the very same multistate group that it had spent the previous nine months working very closely with.....While we certainly respect the right of any state to choose to no longer participate in a multistate (agreement) and to pursue another path, working to actively undermine a multistate while still a member of the Executive Committee simply doesn’t make sense, is unprecedented and is unacceptable. Accordingly, today I informed New York that it is no longer a member of the Executive Committee." Schneiderman's removal will most likely mean a quicker resolution and settlement of the mortgage abuse cases with the nation's top lenders, and also likely result in a lesser amount of penalties and fees the accused banks would be forced to pay. With the threat of investigations off the table, those banks will be willing to offer less in penalties and settlement fees. (Read more here:http://www.huffingtonpost.com/...)
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On Sunday, Bloomberg news report that the US Federal Reserve gave out $1.2 Trillion in til-now secret emergency loans to failing banks in 2008. During the 2008 banking crisis, Fed Chariman Ben Bernake authorized secret loans of public funds to major banks and businesses. In all, 21,000 loans were made for a total of more than $1.2 Trillion of tax-payer money. Morgan Stanley received $106 Billion in loans, Citigroup got $99 Billion, and BofA got $91 Billion. The size of the loans dwarfs the publicly-acknowledged loans made by the Treasury Dept. under the TARP bailouts. Bloomberg News acquired the information about the secret loans only after a Freedom Of Information Act request, and months of litigation. Secret loans were made to both US and foreign banks, including the Royal Bank of Scotland ($84 Billion), and Credit Suisse ($77 Billion). The total size of the loans was more than three times the size of the federal budget deficit in 2008, more than the total earnings of all federally-insured banks in the US for the decade ending in 2010, and roughly equals the estimated size of the amount owned by homeowners of 6.5 million delinquent and foreclosed mortgages to these same banks. The Fed says it has “no credit losses” on any of the emergency loans, and has netted some $13 Billion in interest payments and fees. The loan program was kept from public knowledge to prevent a loss of public confidence in the solvency of US banks. The size of the loan programs shows today the extent of the banking crises was much greater than previously acknowledged by public officials. The secret Federal Bank's bail-out program also shows how the US government was willing to socialize losses to the banking industry while the banks insisted on privatizing financial gains. Critics of the secret loans wonder why the government was not willing to institute such a massive and generous loan program to small businesses and homeowners who similarly faced bankruptcy, after those tax-payers funded the loans to the banking industry. (Read more here: http://www.bloomberg.com/...)
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Robert Sheer has written an interesting piece detailing HUD chief Shaun Donovan's private and public connections, and how those connections are being used to subvert identifying criminal activities among US banking and mortgage firms. Sec. Donovan is one of the Obama administration officials who have been pressuring state attorney generals, such as Eric Schneiderman, who seek further investigations into possible fraudulent mortgage practices and fraudulent creation of mortgage-back securities at the heart of the 2008 banking and economic collapse. It turns out Sec. Donovan was one-time managing director of Prudential Mortgage Capital Co., who oversaw a portfolio of investments in affordable housing loans, including debt owned by Fannie Mae and the FHA. So Sec. Donovan may have good reason for wanting to quash investigations into the securitization of suspect home loans: he was for many years a player in those toxic financial markets. The efforts of Sec. Donovan on behalf of the Obama administration have the appearance of hiding the criminal activities of the wealthy few while pushing more of the costs of the clean up for those crimes onto the many less-fortunate who were indeed the same targets of that criminal activity. (read more here: http://www.truthdig.com/...)