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absolutely sickening. Bill Clinton looks like he was a tier president every day it seems like.
Outrageous HSBC Settlement Proves the Drug War is a Joke
Assistant US Attorney General Lanny Breuer
If you've ever been arrested on a drug charge, if you've ever spent even a day in jail for having a stem of marijuana in your pocket or "drug paraphernalia" in your gym bag, Assistant Attorney General and longtime Bill Clinton pal Lanny Breuer has a message for you: Bite me.
Breuer this week signed off on a settlement deal with the British banking giant HSBC that is the ultimate insult to every ordinary person who's ever had his life altered by a narcotics charge. Despite the fact that HSBC admitted to laundering billions of dollars for Colombian and Mexican drug cartels (among others) and violating a host of important banking laws (from the Bank Secrecy Act to the Trading With the Enemy Act), Breuer and his Justice Department elected not to pursue criminal prosecutions of the bank, opting instead for a "record" financial settlement of $1.9 billion, which as one analyst noted is about five weeks of income for the bank.
The banks' laundering transactions were so brazen that the NSA probably could have spotted them from space. Breuer admitted that drug dealers would sometimes come to HSBC's Mexican branches and "deposit hundreds of thousands of dollars in cash, in a single day, into a single account, using boxes designed to fit the precise dimensions of the teller windows."
This bears repeating: in order to more efficiently move as much illegal money as possible into the "legitimate" banking ins ution HSBC, drug dealers specifically designed boxes to fit through the bank's teller windows. Tony Montana's henchmen marching dufflebags of cash into the fictional "American City Bank" in Miami was actually more subtle than what the cartels were doing when they washed their cash through one of Britain's most storied financial ins utions.
Though this was not stated explicitly, the government's rationale in not pursuing criminal prosecutions against the bank was apparently rooted in concerns that putting executives from a "systemically important ins ution" in jail for drug laundering would threaten the stability of the financial system. The New York Times put it this way:
Federal and state authorities have chosen not to indict HSBC, the London-based bank, on charges of vast and prolonged money laundering, for fear that criminal prosecution would topple the bank and, in the process, endanger the financial system.
It doesn't take a genius to see that the reasoning here is beyond flawed. When you decide not to prosecute bankers for billion-dollar crimes connected to drug-dealing and terrorism (some of HSBC's Saudi and Bangladeshi clients had terrorist ties, according to a Senate investigation), it doesn't protect the banking system, it does exactly the opposite. It terrifies investors and depositors everywhere, leaving them with the clear impression that even the most "reputable" banks may in fact be captured ins utions whose senior executives are in the employ of (this can't be repeated often enough) murderers and terrorists. Even more shocking, the Justice Department's response to learning about all of this was to do exactly the same thing that the HSBC executives did in the first place to get themselves in trouble – they took money to look the other way.
And not only did they sell out to drug dealers, they sold out cheap. You'll hear bragging this week by the Obama administration that they wrested a record penalty from HSBC, but it's a joke. Some of the penalties involved will literally make you laugh out loud. This is from Breuer's announcement:
As a result of the government's investigation, HSBC has . . . "clawed back" deferred compensation bonuses given to some of its most senior U.S. anti-money laundering and compliance officers, and agreed to partially defer bonus compensation for its most senior officials during the five-year period of the deferred prosecution agreement.
Wow. So the executives who spent a decade laundering billions of dollars will have to partially defer their bonuses during the five-year deferred prosecution agreement? Are you ing kidding me? That's the punishment? The government's negotiators couldn't hold firm on forcing HSBC officials to completely wait to receive their ill-gotten bonuses? They had to settle on making them "partially" wait? Every honest prosecutor in America has to be puking his guts out at such bargaining tactics. What was the Justice Department's opening offer – asking executives to restrict their Caribbean vacation time to nine weeks a year?
So you might ask, what's the appropriate financial penalty for a bank in HSBC's position? Exactly how much money should one extract from a firm that has been shamelessly profiting from business with criminals for years and years? Remember, we're talking about a company that has admitted to a smorgasbord of serious banking crimes. If you're the prosecutor, you've got this bank by the balls. So how much money should you take?
How about all of it? How about every last dollar the bank has made since it started its illegal activity? How about you dive into every bank account of every single executive involved in this mess and take every last bonus dollar they've ever earned? Then take their houses, their cars, the paintings they bought at Sotheby's auctions, the clothes in their closets, the loose change in the jars on their kitchen counters, every last freaking thing. Take it all and don't think twice. And then throw them in jail.
Sound harsh? It does, doesn't it? The only problem is, that's exactly what the government does just about every day to ordinary people involved in ordinary drug cases.
It'd be interesting, for instance, to ask the residents of Tenaha, Texas what they think about the HSBC settlement. That's the town where local police routinely pulled over (mostly black) motorists and, whenever they found cash, offered motorists a choice: They could either allow police to seize the money, or face drug and money laundering charges.
Or we could ask Anthony Smelley, the Indiana resident who won $50,000 in a car accident settlement and was carrying about $17K of that in cash in his car when he got pulled over. Cops searched his car and had drug dogs sniff around: The dogs alerted twice. No drugs were found, but police took the money anyway. Even after Smelley produced do entation proving where he got the money from, Putnam County officials tried to keep the money on the grounds that he could have used the cash to buy drugs in the future.
Seriously, that happened. It happens all the time, and even Lanny Breuer's own Justice Deparment gets into the act. In 2010 alone, U.S. Attorneys' offices deposited nearly $1.8 billion into government accounts as a result of forfeiture cases, most of them drug cases. You can see the Justice Department's own statistics right here:
If you get pulled over in America with cash and the government even thinks it's drug money, that cash is going to be buying your local sheriff or police chief a new Ford Expedition tomorrow afternoon.
And that's just the icing on the cake. The real prize you get for interacting with a law enforcement officer, if you happen to be connected in any way with drugs, is a preposterous, outsized criminal penalty. Right here in New York, one out of every seven cases that ends up in court is a marijuana case.
Just the other day, while Breuer was announcing his slap on the wrist for the world's most prolific drug-launderers, I was in arraignment court in Brooklyn watching how they deal with actual people. A public defender explained the absurdity of drug arrests in this city. New York actually has fairly liberal laws about pot – police aren't supposed to bust you if you possess the drug in private. So how do police work around that to make 50,377 pot-related arrests in a single year, just in this city? Tthat was 2010; the 2009 number was 46,492.)
"What they do is, they stop you on the street and tell you to empty your pockets," the public defender explained. "Then the instant a pipe or a seed is out of the pocket – boom, it's 'public use.' And you get arrested."
People spend nights in jail, or worse. In New York, even if they let you off with a misdemeanor and time served, you have to pay $200 and have your DNA extracted – a process that you have to pay for (it costs 50 bucks). But even beyond that, you won't have search very far for stories of draconian, idiotic sentences for nonviolent drug crimes.
Just ask Cameron Douglas, the son of Michael Douglas, who got five years in jail for simple possession. His jailers kept him in solitary for 23 hours a day for 11 months and denied him visits with family and friends. Although your typical non-violent drug inmate isn't the white child of a celebrity, he's usually a minority user who gets far stiffer sentences than rich white kids would for committing the same crimes – we all remember the crack-versus-coke controversy in which federal and state sentencing guidelines left (predominantly minority) crack users serving sentences up to 100 times harsher than those meted out to the predominantly white users of powdered coke.
The ins utional bias in the crack sentencing guidelines was a racist outrage, but this HSBC settlement blows even that away. By eschewing criminal prosecutions of major drug launderers on the grounds (the patently absurd grounds, incidentally) that their prosecution might imperil the world financial system, the government has now formalized the double standard.
They're now saying that if you're not an important cog in the global financial system, you can't get away with anything, not even simple possession. You will be jailed and whatever cash they find on you they'll seize on the spot, and convert into new cruisers or toys for your local SWAT team, which will be deployed to kick in the doors of houses where more such inessential economic cogs as you live. If you don't have a systemically important job, in other words, the government's position is that your assets may be used to finance your own political disenfranchisement.
On the other hand, if you are an important person, and you work for a big international bank, you won't be prosecuted even if you launder nine billion dollars. Even if you actively collude with the people at the very top of the international narcotics trade, your punishment will be far smaller than that of the person at the very bottom of the world drug pyramid. You will be treated with more deference and sympathy than a junkie passing out on a subway car in Manhattan (using two seats of a subway car is a common prosecutable offense in this city). An international drug trafficker is a criminal and usually a murderer; the drug addict walking the street is one of his victims. But thanks to Breuer, we're now in the business, officially, of jailing the victims and enabling the criminals.
This is the disgrace to end all disgraces. It doesn't even make any sense. There is no reason why the Justice Department couldn't have snatched up everybody at HSBC involved with the trafficking, prosecuted them criminally, and worked with banking regulators to make sure that the bank survived the transition to new management. As it is, HSBC has had to replace virtually all of its senior management. The guilty parties were apparently not so important to the stability of the world economy that they all had to be left at their desks.
So there is absolutely no reason they couldn't all face criminal penalties. That they are not being prosecuted is cowardice and pure corruption, nothing else. And by approving this settlement, Breuer removed the government's moral authority to prosecute anyone for any other drug offense. Not that most people didn't already know that the drug war is a joke, but this makes it official.
absolutely sickening. Bill Clinton looks like he was a tier president every day it seems like.
I like the part about the town in Texas that seized people's money. I wonder how the dumbasses on this site who worship state and local government feel about that part.
ing disgraceful. I think bankers have replaced lawyers as the "s my" profession.
the banking sector is just one of the many corrupting/corrupted owners of govt. Of the country, actually. Of the world, actually.
bankers and lenders have STOLEN Ms of homes through mortgage fraud, eg MERS fraud, and:
Founder of DocX/LPS Pleads Guilty in Federal Court
The Founder of DocX, which later changed its name to LPS, has pleaded GUILTY in US District Court for the Middle District of Florida. In the “Factual Basis” do ent attached to her Plea Agreement, Lorraine Brown, the founder of DocX, LLC, admits that the do ents produced by these companies from the period 2003-2009 were forgeries.
Beginning in or about 2003 and continuing through November 2009, employees of DocX at the direction of Brown and others, began forging and falsifying signatures on mortgage-related do ents that they had been hired to prepare and file with property recorder’s offices throughout the United States. Unbeknownst to clients, the Authorized Signers were instructed or authorized by Brown to allow other DocX employees, who were not authorized signers, to sign and notarize the mortgage-related do ents as if the [sic] actually by the Authorized Signer.
Later down:
Thus, even through [sic] clients were told that a senior DocX manager would be preparing and signing the client do ents, there was never any intention to do so.
More
After these do ents were falsely signed and fraudulently notarized, Brown authorized DocX employees to send them through the mails or by electronic means for recording with local county property records offices across the nation. Many of these do ents – particularly mortgage assignments, lost note affidavits, and lost assignment affidavits – were later relied upon in court proceedings, including property foreclosures and federal bankruptcy actions. Brown understood that these property recorders, courts, le insurers and homeowners, relied upon the do ents as genuine.
First of all, let me gloat. I have been saying for how many years that there were easy plain vanilla mail fraud and wire fraud cases to be made (I’m in a rush to get this posted before I go to coach my HS Mock Trial Team, I’ll come back later to put in the links).
Secondly, elsewhere in the plea agreement—don’t’ worry there will be follow-up posts as I dig into these do ents better—she agrees to give res ution to the “victims”. It will be hard for those victims to collect since she is apparently forfeiting most of her money. But bear with me, if foreclosure defendants were to bring a 3rd party action against Lorraine Brown and DocX/LPS (assuming there are DocX/LPS do ents being used against them), they could simply Notice the Depositions of Brown and the relevant robo-signers to obtain testimony to refute the validity of those do ents, and then move for Summary Judgment against the bank trying to foreclose.
http://my.firedoglake.com/cindykouri...rtgage-crisis/
The USA is ing corrupt disaster owned of operated by the 1% and their corrupt lawyers.
No, they are still number 2. They still need the lawyers to protect them.
What percentage of congress are lawyers?
Good point.
like this makes me feel like the the end of the world might be just a few days away after all. In fact, I might almost be hoping for it.
Un ingbelievable
Problem is, it doesn't matter whether D's or R's are in power, they all just continue to let these s off the hook time and again.
Why isn't there more outrage about this?!?!?
There has been for decades. What good does it do?
it's like Leona Helmsley said: the rules are for little people. that goes double for rule of law.
AIFAU
Because the MSM barely covers it and pretends its not a big deal. Banks getting let off the hook for illegal activity is basically par the course in this country. The average American is also borderline re ed and would rather watch here comes Honey Boo Boo than read the news.
When a black guy in Memphis gets caught laundering money/drugs, he gets thrown in jail and the government seizes his assets. That's what should have happened here. Worried about destabilizing the banking industry? Fine. Seize all of HSBC's domestic assets and nationalize it.
we're only allowed to nationalize the risks when they turn bad; if we nationalized insolvent or criminal firms, that would be socialism.
"Because the MSM barely covers it"
MSM are huge corporations, often have interlocking directorates AND advertising from the guilty other corps. MSM ain't never gonna rat on their benefactors.
Big Banks Want Stronger Legal Protections From Mortgage Lawsuits
the New York Times reports:
As regulators complete new mortgage rules, banks are about to get a significant advantage: protection against homeowner lawsuits.
The rules are meant to help bolster the housing market. By shielding banks from potential litigation, policy makers contend that the industry will have a powerful incentive to make higher quality home loans. [...]
The legislation mandated that loans be affordable, but Congress conceded that banks might fear the legal consequences if the mortgages did not comply. So lawmakers created a type of home loan that would have legal protection, called a “qualified mortgage.” In practice, the protection will make it harder for borrowers to sue their lenders in the case of foreclosure.
http://thinkprogress.org/economy/201...l-protections/
The repeated passes Obama's justice department continue to give banks is pathetic.
it's not Dem or Repug, it's the 1% vs 99%. Dems are bad, but the Repugs are much worse. Gecko/Ryan + control of Congress would have been a disaster for the 99%.
http://www.dailykos.com/story/2011/1...it-25-Year-Low
I even went out of my way to find a boutons-approved source........
confirms what I said. 1% vs 99% is more explanatory that Repug vs Dem, but Repugs are represent and fight for the 1% and against the 99% than the Dems do.
Bishop Gecko was going to kill just about all recent financial regulation, and you know his Treasury and SEC people would suck Wall St even harder than Barry's.
Maybe Mitt would have been worse, maybe he wouldn't have been. Either way, doesn't change the fact that Obama is the biggest pushover this country has seen in at least 30 years. If Obama and this crop of democrats really are fighting for the interests of the 99% against the 1%, they sure do suck at it.
"maybe he wouldn't have been"
he said in his campaign that he would kill and re-do all financial regulation that had been set up under Barry. no "maybe" about it. CFPB, increased capital reserves, poof, all gone. Barry is too close to Wall st but Bishop Gecko __IS__ Wall st. There is a huge difference.
" If Obama and this crop of democrats really are fighting for the interests of the 99% against the 1%, they sure do suck at it."
agreed. But the Repugs have been and will be much worse since they don't even try to protect the 99% (eg, see current fiscal proposals from Boner, see Ryan's twice-passed 10-year budgeting)
Makes me wanna puke, tbh. So much wrong here.
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