More Evidence of Systemic Fraud
Our financial markets continue to be driven by liars, addicts, and political enablers. Just this week we’ve seen markets react to the prospect of the Federal Reserve’s cooling of their fiscal methadone program, and two prominent disclosures of internal documents from Bank of America (All In) and ratings agencies like Moody’s and Standard & Poor (Rolling Stone), indicating that, within these institutions, it was common knowledge that the financial system was being gamed.
Chris Hayes’ program, All In, reported on the Bank of America bombshell. This is an excerpt from the show’s transcript (you can watch the video at the BoA link):
we were told to lie. those are the words of a bank of america employee describing what her supervisors asked her to do. and she’s not the only one. in an absolute bombshell filing in federal court , sworn affidavits describe an intentional strategy on the part of the bank to systemically lie to struggling homeowners right up to the point of foreclosure. to hoodwink borrowers, stall for time and maximize the amount of money bank of america got. now, we’ve known for years in talking to the people on the receiving end of the bank’s treatment that borrowers seeking loan modifications were strung along and screwed over. now we have what appears to be the smoking gun. here’s just a sample of what the bank of america employees said under oath. simone gordon, senior collector, 2007 and 2012 , “we were told to lie to customers and claim that bank of america had not received documents it had requested and that it had not received trial payments when, in fact, it had. employees were rewarded by meeting a quota of placing a specific number of accounts into foreclosure.” erica brown, customer service representative , 2009 pane 2010 , “during my time at bank of america i saw well over 100 cases in which a bank of america analyst canceled loan modifications and stated nonpayment as reason for cancelation when it was apparent from the computer system that the homeowner had actually made the required payments.” william wilson , underwriter then- case management team manager, 2010 to 2012 . “employees who challenged or questioned the ethics of bank of america ‘s practice of declining modifications for false and fraudulent reasons for often fired.” teresa, collector 2009 and 2010 . “the information we received in group meetings showed me that bank of america ‘s deliberate practice was to string homeowners along with no intention of providing permanent modifications.”
Matt Taibbi reported on the ratings agencies conscious deception:
Thanks to a mountain of evidence gathered for a pair of major lawsuits, documents that for the most part have never been seen by the general public, we now know that the nation’s two top ratings companies, Moody’s and S&P, have for many years been shameless tools for the banks, willing to give just about anything a high rating in exchange for cash.
In incriminating e-mail after incriminating e-mail, executives and analysts from these companies are caught admitting their entire business model is crooked.
“Lord help our fucking scam . . . this has to be the stupidest place I have worked at,” writes one Standard & Poor’s executive. “As you know, I had difficulties explaining ‘HOW’ we got to those numbers since there is no science behind it,” confesses a high-ranking S&P analyst. “If we are just going to make it up in order to rate deals, then quants [quantitative analysts] are of precious little value,” complains another senior S&P man. “Let’s hope we are all wealthy and retired by the time this house of card[s] falters,” ruminates one more.
Will these institutions ever experience actual accountability? Will our political system ever put in place policies to keep these greed-driven addicts from blowing up the global economy, again?