Banksters through and through

[j_b]

Wall Street Is Laundering Drug Money and Getting Away with It

 

By Zach Carter

 

Too-big-to-fail is a much bigger problem than you thought. We've all read damning accounts of the government saving banks from their risky subprime bets, but it turns out that the Wall Street privilege problem is far more deeply ingrained in the U.S. legal system than the simple bailouts witnessed in 2008. America's largest banks can engage in flagrantly criminal activity on a massive scale and emerge almost completely unscathed. The latest sickening example comes from Wachovia Bank: Accused of laundering $380 billion in Mexican drug cartel money, the financial behemoth is expected to emerge with nothing more than a slap on the wrist thanks to an official government policy which protects megabanks from criminal charges.

 

Bloomberg's Michael Smith has penned a devastating expose detailing Wachovia's drug-money operations and the government's twisted response. The bank was moving money behind literally tons of cocaine from violent drug cartels. It wasn't an accident. Internal whistleblowers at Wachovia warned that the bank was laundering drug money, higher-ups at the bank actively looked the other way in order to score bigger profits, and the U.S. government is about to let everyone involved get off scott free. The bank will not be indicted, because it is official government policy not to prosecute megabanks. From Smith's story:

 

"No big U.S. bank . . . has ever been indicted for violating the Bank Secrecy Act or any other federal law. Instead, the Justice Department settles criminal charges by using deferred-prosecution agreements, in which a bank pays a fine and promises not to break the law again . . . . Large banks are protected from indictments by a variant of the too-big-to-fail theory. Indicting a big bank could trigger a mad dash by investors to dump shares and cause panic in financial markets."

 

Wachovia was acquired by Wells Fargo in late 2008. The bank's penalty for laundering over $380 billion in drug money is going to be a promise not to ever do it again, and a $160 million fine. The fine is so small that Wachovia will almost certainly turn a profit on its drug financing business after legal costs and penalties are taken into account.

 

International authorities know the banker-drug-dealer connection goes well beyond Wachovia, but governments aren't doing anything about it. A 2009 report by the United Nations Office on Drugs and Crime found that most rules to prevent drug money laundering through banks are being violated. From the report:

 

"At a time of major bank failures, money doesn't smell, bankers seem to believe. Honest citizens, struggling in a time of economic hardship, wonder why the proceeds of crime – turned into ostentatious real estate, cars, boats and planes – are not seized."

 

In late 2009, the head of that U.N. office, Antonio Maria Costa, told the press that much interbank lending—short-term loans banks make to each other—was being supported by drug money. As financial markets froze up in 2007 and 2008, banks turned to drug cartels for cash. Without that drug money, many major banks might not have survived.

 

read more: http://www.alternet.org/economy/147564/wall_street_is_laundering_drug_money_and_getting_away_with_it/?page=entire

[kevbone]

We can start by auditing the Federal Reserve.

[Stonehead]

Wall Street Is Laundering Drug Money and Getting Away with It

 

By Zach Carter

 

Too-big-to-fail is a much bigger problem than you thought. We've all read damning accounts of the government saving banks from their risky subprime bets, but it turns out that the Wall Street privilege problem is far more deeply ingrained in the U.S. legal system than the simple bailouts witnessed in 2008. America's largest banks can engage in flagrantly criminal activity on a massive scale and emerge almost completely unscathed. The latest sickening example comes from Wachovia Bank: Accused of laundering $380 billion in Mexican drug cartel money, the financial behemoth is expected to emerge with nothing more than a slap on the wrist thanks to an official government policy which protects megabanks from criminal charges.

 

Bloomberg's Michael Smith has penned a devastating expose detailing Wachovia's drug-money operations and the government's twisted response. The bank was moving money behind literally tons of cocaine from violent drug cartels. It wasn't an accident. Internal whistleblowers at Wachovia warned that the bank was laundering drug money, higher-ups at the bank actively looked the other way in order to score bigger profits, and the U.S. government is about to let everyone involved get off scott free. The bank will not be indicted, because it is official government policy not to prosecute megabanks. From Smith's story:

 

"No big U.S. bank . . . has ever been indicted for violating the Bank Secrecy Act or any other federal law. Instead, the Justice Department settles criminal charges by using deferred-prosecution agreements, in which a bank pays a fine and promises not to break the law again . . . . Large banks are protected from indictments by a variant of the too-big-to-fail theory. Indicting a big bank could trigger a mad dash by investors to dump shares and cause panic in financial markets."

 

Wachovia was acquired by Wells Fargo in late 2008. The bank's penalty for laundering over $380 billion in drug money is going to be a promise not to ever do it again, and a $160 million fine. The fine is so small that Wachovia will almost certainly turn a profit on its drug financing business after legal costs and penalties are taken into account.

 

International authorities know the banker-drug-dealer connection goes well beyond Wachovia, but governments aren't doing anything about it. A 2009 report by the United Nations Office on Drugs and Crime found that most rules to prevent drug money laundering through banks are being violated. From the report:

 

"At a time of major bank failures, money doesn't smell, bankers seem to believe. Honest citizens, struggling in a time of economic hardship, wonder why the proceeds of crime – turned into ostentatious real estate, cars, boats and planes – are not seized."

 

In late 2009, the head of that U.N. office, Antonio Maria Costa, told the press that much interbank lending—short-term loans banks make to each other—was being supported by drug money. As financial markets froze up in 2007 and 2008, banks turned to drug cartels for cash. Without that drug money, many major banks might not have survived.

 

read more: http://www.alternet.org/economy/147564/wall_street_is_laundering_drug_money_and_getting_away_with_it/?page=entire

 

So basically, government either failed to enforce laws or acted weakly in its regulation. Sounds oddly similar to the Feds handling of the illegal immigation situation, the BP deepwater drilling, and the financial crisis.

 

Some of this might be more indicative of the sheer power of megacorporations but I wouldn't automatically assume that more government is the answer. Perhaps though, gov't could be more efficient.

[j_b]

It is oddly similar because destroying the regulatory powers of government over business has been the central theme of the Republican agenda for 30 + years. We can now see the catastrophic upshot of unfettered capitalism in many different sectors of the economy. It clearly implies that we need more regulatory government over corporations.

 

As for "big government", the growth of government under the disguise of privatization since the beginning of the "war on terror" has been so large that nobody can say how low large it is:

"I can't get a number on how many contractors work for the Office of the Secretary of Defense."

[Stonehead]

Unfettered capitalism or malignant capitalism? Two different things, huh? The first might be indicative of the absence of government regulation of any sort and the second might imply the corruption of government by special interests. What the article points out is that the government FAILED for whatever reason and that the behavior of the megacorporations is a symptom of that failure.

 

As far as government oversight, I wouldn’t say that regulation in itself is the magic bullet. I thought that capitalism implied competition so that encouraging the growth of businesses was advantageous. When overregulation stifles growth then it is counterproductive. Here’s a radical idea: perhaps government should become more efficient in delivering its services.

 

Apart from the role of government, the root problem seems to stem from the malignant process that forms megacorporations. It is the concentration of power itself that appears to be the problem. The merger of power forms corporations ‘too big to fail’ and often takes the guise of monopoly. It is like a cancer in that this type of abnormal growth tends to stifle the normal components of the system.

 

The same problem could be said for a particular form of government.

 

[billcoe]

the root problem seems to stem from the malignant process that forms megacorporations.

 

Back when the Hydra that was Standard Oil was forming under John D Rockefeller's tutelage, Government, let by trustbuster Teddy Roosevelt, let the charge to change it, reduce it and force competition. John D wasn't aware of the extent that these people needed donations and the motivations thereof and he was relatively politically unmotivated until after the breakup. This is totally at odds and with different rules of engagement with how current large corporations operate.

 

When the current Hydra-like big Government has grown too monopolistic and omniscient and all powerful, what can you do? Where is Teddy? That they can take a billion here and a billion there or only $100,000,000 of our money and so gracefully toss it to Blackwater to make it disappear is as disconcerting on the Government side to me as the reverse. I don't doubt that we as a country see some good come of it, but the size and role of government is the real concern. Who is really watchdogging any of this hidden invisible to citizen's stuff?

 

I remember reading that the military had 28,000 hires who's sole job it was was to work on publicity so that folks the world over think good thoughts of us. Holy crap! 28,000 people! That did not include contractors hired to do the same.

[kevbone]

It is oddly similar because destroying the regulatory powers of government over business has been the central theme of the Republican agenda for 30 + years.

 

I believe you. Problem is.....it is also the Democratic agenda as well. If you do nothing to stop it when you have power...then you are part of the problem.

[Off_White]

Hey Bill, do you mean the same Teddy Roosevelt who was an ardent embracer of eugenics? He'd have happily had you sterilized for miscegenation. Well, maybe just your wife, since she's the one of inferior genetics...

[billcoe]

That's the one ! Perdicaris alive or Raisuli dead!!! He said. In the end they just shut the hell up and paid the ransom, and the public, thinking the big stick had won the day, went happy with crazed madness. How could you not vote for the man?

http://en.wikipedia.org/wiki/Ion_Perdicaris

 

Oh I'm pretty sure he'd get both Jasmine and I Doug although her parents were pretty clear that by marrying a white guy she was actually marrying down and weakening their race! LOL! They tried to be nice about it at least. I really hadn't thought about it till then, imagine that, lived together for 4 years and finally get a wake up call from your in-laws to be that your wife to be is another race. Once the first grandchild got here they started being color blind and accepted me into the family, that's what unconditional love will do for you I suppose.

[Off_White]

That was an entertaining link, another bit of TR's history I was unfamiliar with. Here's a link to the article in Orion magazine about the connection between Eugenics and the conservation movement. It was pretty eye opening to me, TR and Gifford Pinchot as white supremacists...

 

link

[billcoe]

Great read, thanks for the link!

 

However, regarding this part of the story: " The racists remain his adversary every day, even in the village clinic where Jim works and where we later talked about eugenics. “We think that’s history,” he said, “but what’s the trickle-down? In this building there is very free and easy access to birth control. Any type of birth control you can imagine, and if you still find yourself pregnant, there is free abortion. There’s no polite way to say it—to cut down on breeding. It’s not just accessible, it’s promoted. Kill your baby. And when you talk about values changing, when you no longer see your children as a blessing, that is some really bad stuff.”"

 

It's an interesting viewpoint as many pregger women, pre-abortion, didn't see the value of children as well, yet I remember before Roe V Wade, rich women who wanted to not carry a baby to term merely flew over and back to a country that had abortion. Poor women were literally screwed. As far as that goes, I bet a study of class/money and abortions would show a similar trend today, regardless of race.

[j_b]

It is oddly similar because destroying the regulatory powers of government over business has been the central theme of the Republican agenda for 30 + years.

 

I believe you. Problem is.....it is also the Democratic agenda as well. If you do nothing to stop it when you have power...then you are part of the problem.

 

The Democratic party is very heterogeneous (from right wing to moderate left), but it is true that Democratic presidents from Carter to Clinton have implemented deregulation as well as many other neo-liberal policies (neo-liberal as in unfettered capitalism). It'll be interesting to see which Democrats argue to continue tax cuts for those with income greater than 250k because it'll tell us which Dems should be targeted by progressives.

[Off_White]

Bear in mind that Jim is talking about a clinic on a Reservation. The issue of babies on the Rez is pretty complicated, there are prime examples of the link between early pregnancy and poverty, as well as folks who came from the boarding school era, a time when the federal government attempted to dismantle the tribes.

[summitchaserCJB]

When I read your post OW I thought you said "beer in mind"- which is kinda of a self-fulfilling prophecy because I did have beer in mind at the time.

[Stonehead]

It would be an interesting exercise to estimate the number of people required to sustain the system and if the retrenchment that is occurring is a manifestation of this emerging knowledge. Certainly along with technological developments such as advanced robotics the issue of chasing after the least expensive labor pool would dwindle in significance. Some problems would be solved but issues such as displacement of workers and the feeling of alienation resulting from replacement would still persist. Kind of crazy to consider but interesting nevertheless.

 

The rationale for a new eugenics?

 

[video:youtube]v=nvZBtJ-ncEM

[video:youtube]v=aPTd8XDZOEk

[video:youtube]v=wg8YYuLLoM0

 

As Chinese Wages Rise, Machines Replace Migrant Workers---Bloomberg.com

[billcoe]

It would be an interesting exercise to estimate the number of people required to sustain the system and if the retrenchment that is occurring is a manifestation of this emerging knowledge. Certainly along with technological developments such as advanced robotics the issue of chasing after the least expensive labor pool would dwindle in significance. Some problems would be solved but issues such as displacement of workers and the feeling of alienation resulting from replacement would still persist. Kind of crazy to consider but interesting nevertheless.

 

It's been done. Kurt Vonnegut: Player Piano. Great work too and it seems to coming to fruition 50 years after he wrote it. .

[Stonehead]

The biggest crime of our time could arguably be, not the devaluation of assets in general, but the devaluation of human life or in economic terms, human capital.

[JayB]

Wall Street Is Laundering Drug Money and Getting Away with It

 

 

One more argument for legalizing all drugs as soon as possible.

 

People have conjured up the notion of RJR or Seagrams cooking up new varieties of drugs as some kind of nightmare. It's certainly true that people would continue to destroy themselves and their families with drugs, and perhaps more people would do so if they were legal - but the empirical evidence for this claim just isn't there. Even if it is, people have the right to do whatever they wish to their own bodies so long as they don't directly harm anyone else in the process. Base-jumping is orders of magnitude more likely to produce lethal outcomes than crack, herion, etc, etc, etc, but banning it in order to protect base-jumpers from themselves would be equally silly.

 

With capital, expertise, and safety regulations in place at least they'd know what they were taking, and drugs that are formulated to produce whatever high they're after that are formulated to be less hazardous and potentially less addictive sounds like a much better deal for society than the current status quo where people seeking out new highs use themselves as guinea pigs. I was just reading preliminary reports about the effects about a few new synthetic drugs that are making the rounds and it's not pretty. Not nearly as bad as the prohibition fueled violence around the world, but far worse than things would be if people who want to use drugs had safe, legal channels to go through.

[billcoe]

It's been noted that if we took half the money we spend on locking up folks who are only hurting themselves (this isn't the vicious addict hitting an old lady over the head who would still go directly to Jail, would not pass go and would not collect $200), and spent it on REHAB, we would be much further along and that recidivism rates would go down as well.

 

One of the things I repeatedly see in the US is that average joes get to mandate policy as knee jerk reaction, even if they are wrong. Our prison policy should run by scientists with oversight, and not by the uninformed public who just want to lock em all up and toss the key. I don't have the numbers in front of me, but at one point I'd seen the increase in recidivism (those who get out of jail and then re-offend) had risen dramatically because of this California policy change.

[JayB]

It's been noted that if we took half the money we spend on locking up folks who are only hurting themselves (this isn't the vicious addict hitting an old lady over the head who would still go directly to Jail, would not pass go and would not collect $200), and spent it on REHAB, we would be much further along and that recidivism rates would go down as well.

 

One of the things I repeatedly see in the US is that average joes get to mandate policy as knee jerk reaction, even if they are wrong. Our prison policy should run by scientists with oversight, and not by the uninformed public who just want to lock em all up and toss the key. I don't have the numbers in front of me, but at one point I'd seen the increase in recidivism (those who get out of jail and then re-offend) had risen dramatically because of this California policy change.

 

Pretty much agree on all points. California's three-strikes law is retarded, and only makes it harder to deal with rapists, murderers, etc by diverting money and resources into locking up people who harm themselves.

 

I was visiting friends in San Clemente last weekend and heard about a meth-addict/surfer who's "third strike" was possesion. Not sure how much, etc - but sounds like the local consensus was that he wasn't a direct threat to anyone but himself.

 

Locking a guy like that up for life is obscene, and paying $50G a year, plus inflation, to do it is an obscenely stupid misallocation or resources - even for a state like California, which is probably second only to Greece in that category.

 

Given that prohibition only compounds social problems, diverts resources away from other social priorities, and gives the government a pretext for violating civil liberties, etc you'd think that progressives would be all over it. Given that it expands the size and power of government, gives them a pretext to trample all over property rights you'd think conservatives would be all over it. That makes it all the more surprising that the only people who have consistently argued against all prohibitionist policies since their inception have been libertarians, who have never constituted enough of the population to move the policy needle.

[j_b]

Wall Street Is Laundering Drug Money and Getting Away with It

 

 

One more argument for legalizing all drugs as soon as possible.

 

[...]

 

Right, but no comments from you about the systemic failure to regulate corporations, the result of 30+ years of drowning government in a bathtub by market zealots.