Published in CommPRO.biz 2013.06.26

BofA Told to Lie

 

When an entire sector of our economy -a crucial sector- is handed “Get Out of Jail Free” cards by our federal government, we should not be surprised when they run off the rails. We are talking about the monster, too-big-to-fail banks. It is more than surprising, it’s a miracle that it isn’t any worse than it is. The Department of Justice (DOJ) and its head, Eric Holder, the highest ranking law enforcement officer in the USA, has decided in the case of these banks that he will not enforce the law. He has repeatedly given the monster banks a pass. His rationale is that jailing top banking officials will destabilize the banks and our economy. Shows you how precious little Holder knows about business.

We have the major banks running amuck, fixing interest rates, laundering money for drug cartels and dictators, playing fast and loose with mortgages, ripping off consumers right and left and anything else that comes to their evil little minds. The latest instance is playing out in a Federal Courtroom in Boston where former Bank of America (BofA) workers are lined up to blow the whistle on the warped sickies running this bank. A bank that owes its very existence to the nearly $50 billion we taxpayers handed them to literally keep them afloat following the economic collapse they helped trigger.

In sworn statements BofA expats detail the bank’s efforts to squeeze every dime out of homeowners struggling to hang on to their homes. Bonuses to meet their foreclosure quotas, gift cards, all kinds of incentives to lie and cover up misdeeds designed to line the bank’s pockets with fees and interest before crushing those they should have been helping. And why not? If you get caught and have to pay a fine, it’s peanuts in comparison to the bucks pouring into the bank’s coffers. Just another cost of doing business.

This is not going to stop until we start charging the top executives of these banks and they face jail - that’s what it’s going to take. Attorney General Holder may be a fine lawyer but he clearly doesn’t know squat about business. Executives who allow the kind of behavior that we’ve seen at BofA, HSBC, Chase and the other big banks are lousy business people and lousy leaders. There are lots of honest people waiting in the ranks of these banks, ready and able to lead and build on a proven ethical foundation to produce happy customers. And in case you haven’t noticed, happy customers produce higher profits.

We do need to remove the temptation that allows banks to speculate with their customers’ deposits instead of investing them in our economy. We need the so-called Volker Rule. And we need to break up the monster banks. Take them out of the too-big-to-fail league. All the stuff that the big bankers little helpers’ on “K” Street managed to lobby out of the laws that protected us against bad bankers for decades. However, the DOJ’s first order of business should be to level criminal charges against these arrogant, ignorant punks who have no place leading any business, let alone one in the financial heart of the world economy.

Published in CommPro.biz 2013.04.25

 

HSBC Scot Free?

In study after study there is nothing to support the idea that “C” Suite occupants are irreplaceable. There’s an occasional example of a corporate leader’s departure negatively impacting a company’s performance: Steve Jobs’s voluntary ten-year absence from Apple left the company floundering; the jury is out at this point following his death in the fall of 2011 but the company is certainly not going to collapse. However, in all but a few cases there is an able individual in the wings ready to take over.

That makes a Department of Justice decision to give HSBC a get-out-of-jail-free card so outrageous. Listen to Attorney General Eric Holder earlier this month (2013.03.08) before a Senate Committee: "I am concerned that the size of some of these institutions becomes so large that it does become difficult for us to prosecute them when we are hit with indications that if we do prosecute -- if we do bring a criminal charge -- it will have a negative impact on the national economy, perhaps even the world economy," How dumb is that? What an insult to the tens of thousands of honest HSBC people to imagine that there are not lots of capable executives at HSBC who could step into the shoes of the boneheads who have turned an international financial giant into a gigantic criminal enterprise.

Let’s review: HSBC laundered carloads of money for the Sinaloa Drug Cartel, who are reported to have murdered thousands of people. HSBC created shams to help North Korea, Iran and others beat sanctions. HSBC financed Al Qaeda and a wide range of terrorist organizations along with mobsters in Russia, and they provided good old tax cheats a place to stash their earnings. That’s just a smattering of the flat-out criminal activity at HSBC. And the DOJ is letting them get away with it? Just have coffee in the same coffee shop as a terrorist and you’ll be grilled by the FBI. And HSBC gets a pass? Unbelievable!

Where does Holder think the “indications” of worldwide economic collapse if we jail these crooks is coming from? From the same HSBC lobbyists who pour bucks into the pockets of members of the Congress. Fortunately there are a few on the hill who are willing to stand up to these crooks, Carl Levin and Elizabeth Warren among others. Still, one estimate of support in the Senate for a break-up of the monster banks sees fewer than forty votes. Can you imagine how few members of the House would support such an action?

Everyone knows that’s what’s needed. The Dallas Fed chairman and at least one other Fed Board member have documented the need to break up the too-big-to-fail banks. These banks are the real threat to the world’s economic health. And until we treat criminal banksters for what they are, crooks, and put them in jail where crooks belong, they are going to keep right on breaking the law and risking another crash with their roulette wheel style of banking. Why not, when the top law enforcement officer in the United States gives them a pass?