A short update on the energies November 5, 2014 by Aisha North By now, many of you have already become quite adept at floating in these very new waters, and with this proficiency also comes a confidence that will help not just you, but so many in your vicinity as well. Let us explain. For you are the forerunners in every sense of the word, and now, as you have dared to go where no man has gone before you, you have entered virgin territory with the totality of your being, and as such, you have also made that old well of ancient knowledge available to all those who dare to go and seek it. You see, this task is not for all, for as you have already been told, your paths will in many ways begin to diverge more and more now, as you each step up to your individual tasks. And so, you will all feel that inner calling stirring you into action, and it will do so at a time and in a way that is perfectly suited not just to your personal needs, but also to those of the collective. In other words, even if you at times may find yourself on what will seem to be a lonely path indeed, know that every step you take will be for the betterment of all, and not just the few. Indeed, what any of you do, even the simplest of little every day things, you do for ALL, for by now, everything you do will be imbued with this very New energy. And so, no matter where you are or what you do, you will continue to bring this New energy out into your world in every way and in every day, with the very presence of your being and with the very pulse of your beating heart. For now, more than ever, you are indeed living, breathing examples of the New World, embodied within that same familiar physical frame that you have carried from your very first breath in this incarnation, but then, nothing about you apart from that very superficial facade will ever be the same again. For as you stepped across that threshold that separates the New World from the old, you stepped away from any and all inhibitions that still clung to your frame in your previous lives, and as such, you are totally NEW in every sense of the word that you can think of, and then some. And with this newness comes a whole new way of BEing, a way of truly living from the heart, enabling this New energy to flow forth freely. Not just in you, but through you and out into this world that will still look very much the same to so many of you, but that in essence will also show itself to be completely New. So again we say go forth with your head held high and your heart wide open, and know that as you do just that, love will flow out in all directions, and your energetic footprints will last longer than those supposedly left by the men that visited your moon all those years ago. For unlike the less permanent vibration that saturated the old world, this New energy is a permanent one, one that cannot be erased, evicted or removed in any way – no matter how hard some of your fellow men will try to do just that. For make no mistake, you are still not in majority on this planet, for it is still only a chosen few who have chosen to step across that divide and fully embrace the New. And when we say chosen, we use that word fully knowing that to some, it will suggest a way of putting some above others. But in this, nothing could be more wrong, for in this, it is entirely up to each and every one of you to decide whether or not you are to be amongst the chosen ones, for it is YOU who choose to enter the New, no one else can or will do that for you. And so, as your numbers are still limited compared to that vast sea of humanity that surrounds you on all sides, know that amongst this vast sea of humanity, there are a multitude of shining souls getting ready to take that last decisive step and join you on your side of this divide, while at the same time, there is a small number getting ready to dig their feet in even deeper in the old trenches, and again, they will not make themselves go unnoticed in any way. Again, this is not said in order to ignite any fear in any one of you, simply as a way to remind you that your light is all-important in the time ahead, so do not make the mistake of trying to hide it away. For now, it is time for you ALL to stand tall and proud, so that your fearless light can bee seen from every direction, no matter how high the waves may become because of the insistence of a few shadow dwellers to remain unmoved but not unnoticed. So again we say know that you are more than protected, for you have chosen to step away from the fray, but also know that you can no longer hide your light from anyone around you. This will bring you so much joy in the time ahead, for you will see how your true light is being reflected back at you from more and more souls that begin to tune into their own true tune as well. But also know that your light will now, more than before, ignite the tendency to panic and fury that is still latent in those few unmoved souls that still try as hard as they can not to separate themselves from their old roles. For as we have already told you, for some, the old holds more comfort than the new, no matter how brilliant it will seem to others, or no matter how much love they will find waiting for them there. And so, their gut reaction will once again be to dig themselves ever deeper into their small cubbyholes of fear, where they will – at least for now – feel more at home than if they were to step across that line and join you all in the land of the New. So again we say just stay in your light, and know that no matter what happens in the time ahead, it is all well, and it will all happen because the light is helping to tap away on every single closed door there is in order to help as many of your fellow men and women join you in joy and in love here in the brand New. | ||||||||
The $9 Billion Witness: Meet JPMorgan Chase’s Worst Nightmare Posted: 08 Nov 2014 04:04 AM PST
The $9 Billion Witness: Meet JPMorgan Chase’s Worst Nightmare Meet the woman JPMorgan Chase paid one of the largest fines in American history to keep from talking BY MATT TAIBBI | NOVEMBER 6, 2014 She tried to stay quiet, she really did. But after eight years of keeping a heavy secret, the day came when Alayne Fleischmann couldn’t take it anymore. “It was like watching an old lady get mugged on the street,” she says. “I thought, ‘I can’t sit by any longer.'” Fleischmann is a tall, thin, quick-witted securities lawyer in her late thirties, with long blond hair, pale-blue eyes and an infectious sense of humor that has survived some very tough times. She’s had to struggle to find work despite some striking skills and qualifications, a common symptom of a not-so-common condition called being a whistle-blower. Fleischmann is the central witness in one of the biggest cases of white-collar crime in American history, possessing secrets that JPMorgan Chase CEO Jamie Dimon late last year paid $9 billion (not $13 billion as regularly reported – more on that later) to keep the public from hearing. Back in 2006, as a deal manager at the gigantic bank, Fleischmann first witnessed, then tried to stop, what she describes as “massive criminal securities fraud” in the bank’s mortgage operations. Thanks to a confidentiality agreement, she’s kept her mouth shut since then. “My closest family and friends don’t know what I’ve been living with,” she says. “Even my brother will only find out for the first time when he sees this interview.” Six years after the crisis that cratered the global economy, it’s not exactly news that the country’s biggest banks stole on a grand scale. That’s why the more important part of Fleischmann’s story is in the pains Chase and the Justice Department took to silence her. She was blocked at every turn: by asleep-on-the-job regulators like the Securities and Exchange Commission, by a court system that allowed Chase to use its billions to bury her evidence, and, finally, by officials like outgoing Attorney General Eric Holder, the chief architect of the crazily elaborate government policy of surrender, secrecy and cover-up. “Every time I had a chance to talk, something always got in the way,” Fleischmann says. This past year she watched as Holder’s Justice Department struck a series of historic settlement deals with Chase, Citigroup and Bank of America. The root bargain in these deals was cash for secrecy. The banks paid big fines, without trials or even judges – only secret negotiations that typically ended with the public shown nothing but vague, quasi-official papers called “statements of facts,” which were conveniently devoid of anything like actual facts. And now, with Holder about to leave office and his Justice Department reportedly wrapping up its final settlements, the state is effectively putting the finishing touches on what will amount to a sweeping, industrywide effort to bury the facts of a whole generation of Wall Street corruption.“I could be sued into bankruptcy,” she says. “I could lose my license to practice law. I could lose everything. But if we don’t start speaking up, then this really is all we’re going to get: the biggest financial cover-up in history.” Alayne Fleischmann grew up in Terrace, British Columbia, a snowbound valley town just a brisk 18-hour drive north of Vancouver. She excelled at school from a young age, making her way to Cornell Law School and then to Wall Street. Her decision to go into finance surprised those closest to her, as she had always had more idealistic ambitions. “I helped lead a group that wrote briefs to the Human Rights Chamber for those affected by ethnic cleansing in Bosnia-Herzegovina,” she says. “My whole life prior to moving into securities law was human rights work.” But she had student loans to pay off, and so when Wall Street came knocking, that was that. But it wasn’t like she was dragged into high finance kicking and screaming. She found she had a genuine passion for securities law and felt strongly she was doing a good thing. “There was nothing shady about the field back then,” she says. “It was very respectable.” In 2006, after a few years at a white-shoe law firm, Fleischmann ended up at Chase. The mortgage market was white-hot. Banks like Chase, Bank of America and Citigroup were furiously buying up huge pools of home loans and repackaging them as mortgage securities. Like soybeans in processed food, these synthesized financial products wound up in everything, whether you knew it or not: your state’s pension fund, another state’s workers’ compensation fund, maybe even the portfolio of the insurance company you were counting on to support your family if you got hit by a bus. As a transaction manager, Fleischmann functioned as a kind of quality-control officer. Her main job was to help make sure the bank didn’t buy spoiled merchandise before it got tossed into the meat grinder and sold out the other end. A few months into her tenure, Fleischmann would later testify in a DOJ deposition, the bank hired a new manager for diligence, the group in charge of reviewing and clearing loans. Fleischmann quickly ran into a problem with this manager, technically one of her superiors. She says he told her and other employees to stop sending him e-mails. The department, it seemed, was wary of putting anything in writing when it came to its mortgage deals. “If you sent him an e-mail, he would actually come out and yell at you,” she recalls. “The whole point of having a compliance and diligence group is to have policies that are set out clearly in writing. So to have exactly the opposite of that – that was very worrisome.” One former high-ranking federal prosecutor said that if he were taking a criminal case to trial, the information about this e-mail policy would be crucial. “I would begin and end my opening statement with that,” he says. “It shows these people knew what they were doing and were trying not to get caught.” In late 2006, not long after the “no e-mail” policy was implemented, Fleischmann and her group were asked to evaluate a packet of home loans from a mortgage originator called GreenPoint that was collectively worth about $900 million. Almost immediately, Fleischmann and some of the diligence managers who worked alongside her began to notice serious problems with this particular package of loans. For one thing, the dates on many of them were suspiciously old. Normally, banks tried to turn loans into securities at warp speed. The idea was to go from a homeowner signing on the dotted line to an investor buying that loan in a pool of securities within two to three months. Thus it was a huge red flag to see Chase buying loans that were already seven or eight months old.
What this meant was that many of the loans in the GreenPoint deal had either been previously rejected by Chase or another bank, or were what are known as “early payment defaults.” EPDs are loans that have already been sold to another bank and have been returned after the borrowers missed multiple payments. That’s why the dates on them were so old. In other words, this was the very bottom of the mortgage barrel. They were like used cars that had been towed back to the lot after throwing a rod. The industry had its own term for this sort of loan product: scratch and dent. As Chase later admitted, it not only ended up reselling hundreds of millions of dollars worth of those crappy loans to investors, it also sold them in a mortgage pool marketed as being above subprime, a type of loan called “Alt-A.” Putting scratch-and-dent loans in an Alt-A security is a little like putting a fresh coat of paint on a bunch of junkyard wrecks and selling them as new cars. “Everything that I thought was bad at the time,” Fleischmann says, “turned out to be a million times worse.” (Chase declined to comment for this article.) When Fleischmann and her team reviewed random samples of the loans, they found that around 40 percent of them were based on overstated incomes – an astronomically high defect rate for any pool of mortgages; Chase’s normal tolerance for error was five percent. One mortgage in particular that sticks out in Fleischmann’s mind involved a manicurist who claimed to have an annual income of $117,000. Fleischmann figured that even working seven days a week, this woman would have needed to work 488 days a year to make that much. “And that’s with no overhead,” Fleischmann says. “It wasn’t possible.” But when she and others raised objections to the toxic loans, something odd started happening. The number-crunchers who had been complaining about the loans suddenly began changing their reports. The process she describes is strikingly similar to the way police obtain false confessions: The interrogator verbally abuses the target until he starts producing the desired answers. “What happened,” Fleischmann says, “is the head diligence manager started yelling at his team, berating them, making them do reports over and over, keeping them late at night.” Then the loans started clearing. As late as December 11th, 2006, diligence managers had marked a full 33 percent of one loan sample as “stated income unreasonable for profession,” meaning that it was nearly inevitable that there would be a high number of defaults. Several high-ranking executives were copied on this report. Then, on December 15th, a Chase sales executive held a lengthy meeting with reps from GreenPoint and the diligence team to examine the remaining loans in the pool. When they got to the manicurist, Fleischmann remembers, one of the diligence guys finally caved under the pressure from the sales executive. “He had his hands up and just said, ‘OK,’ and he cleared it,” says Fleischmann, adding that he was shaking his head “no” even as he was saying yes. Soon afterward, the error rate in the pool had magically dropped below 10 percent – a threshold that itself had just been doubled to clear the way for this deal. After that meeting, Fleischmann testified, she approached a managing director named Greg Boester and pleaded with him to reconsider. She says she told Boester that the bank could not sell the high-risk loans as low-risk securities without committing fraud. “You can’t securitize these loans without special disclosure about what’s wrong with them,” Fleischmann told him, “and if you make that disclosure, no one will buy them.” A former Olympic ski jumper, Boester was such an important executive at Chase that when he later defected to the Chicago-based hedge fund Citadel, Dimon cut off trading with Citadel in retaliation. Boester eventually returned to Chase and is still there today despite his role in this affair. This moment illustrates the most basic element of the case against Chase: The bank knowingly peddled products stuffed with scratch-and-dent loans to investors without disclosing the obvious defects with the underlying loans. Years later, in its settlement with the Justice Department, Chase would admit that this conversation between Fleischmann and Boester took place (though neither was named; it was simply described as “an employee . . . told . . . a managing director”) and that her warning was ignored when the bank sold those loans off to investors. A few weeks later, in early 2007, she sent a long letter to another managing director, William Buell. In the letter, she warned Buell of the consequences of reselling these bad loans as securities and gave detailed descriptions of breakdowns in Chase’s diligence process. Fleischmann assumed this letter, which Chase lawyers would later jokingly nickname “The Howler” after the screaming missive from the Harry Potter books, would be enough to force the bank to stop selling the bad loans.“It used to be if you wrote a memo, they had to stop, because now there’s proof that they knew what they were doing,” she says. “But when the Justice Department doesn’t do anything, that stops being a deterrent. I just didn’t know that at the time.” In February 2008, less than two years after joining the bank, Fleischmann was quietly dismissed in a round of layoffs. A few months later, proof would appear that her bosses knew all along that the boom-era mortgage market was rotten. That September, as the market was crashing, Dimon boasted in a ball-washing Fortune article titled “Jamie Dimon’s SWAT Team” that he knew well before the meltdown that the subprime market was toast. “We concluded that underwriting standards were deteriorating across the industry.” The story tells of Dimon ordering Boester’s boss, William King, to dump the bank’s subprime holdings in October 2006. “Billy,” Dimon says, “we need to sell a lot of our positions. . . . This stuff could go up in smoke!” In other words, two full months before the bank rammed through the dirty GreenPoint deal over Fleischmann’s objections, Chase’s CEO was aware that loans like this were too dangerous for Chase itself to own. (Though Dimon was talking about subprime loans and GreenPoint was technically an Alt-A pool, the Fortune story shows that upper management had serious concerns about industry-wide underwriting problems.) In January 2010, when Dimon testified before the Financial Crisis Inquiry Commission, he told investigators the exact opposite story, portraying the poor Chase leadership as having been duped, just like the rest of us. “In mortgage underwriting,” he said, “somehow we just missed, you know, that home prices don’t go up forever.” When Fleischmann found out about all of this years later, she was shocked. Her confidentiality agreement at Chase didn’t bar her from reporting a crime, but the problem was that she couldn’t prove that Chase had committed a crime without knowing whether those bad loans had been sold. As it turned out, of course, Chase was selling those rotten dog-meat loans all over the place. How bad were they? A single lawsuit by a single angry litigant gives some insight. In 2011, Chase was sued over massive losses suffered by a group of credit unions. One of them had invested $135 million in one of the bank’s mortgage–backed securities. About 40 percent of the loans in that deal came from the GreenPoint pool. The lawsuit alleged that in just the first year, the security suffered $51 million in losses, nearly 50 times what had been projected. It’s hard to say how much of that was due to the GreenPoint loans. But this was just one security, one year, and the losses were in the tens of millions. And Chase did deal after deal with the same methodology. So did most of the other banks. It’s theft on a scale that blows the mind. In the spring of 2012, Fleischmann, who'd moved back to Canada after leaving Chase, was working at a law firm in Calgary when the phone rang. It was an investigator from the States. “Hi, I’m from the SEC,” he said.“You weren’t expecting to hear from me, were you?” A few months earlier, President Obama, giving in to pressure from the Occupy movement and other reformers, had formed the Residential Mortgage-Backed Securities Working Group. At least superficially, this was a serious show of force against banks like Chase. The group would operate like a kind of regulatory Justice League, combining the superpowers of investigators from the SEC, the FBI, the IRS, HUD and a host of other federal agencies. It included noted anti-corruption- investigator and New York Attorney General Eric Schneiderman, which gave many observers reason to hope that finally something would be done about the crimes that led to the crash. That makes the fact that the bank would skate with negligible cash fines an even more extra-ordinary accomplishment. New York Attorney General Eric Schneiderman (L) speaks whille Attorney General Eric Holder listens during a news conference at the Justice Department on January 27th, 2012. New York Attorney General Eric Schneiderman (L) speaks whille Attorney General Eric Holder listens during a news conference at the Justice Department on January 27th, 2012. (Photo: Mark Wilson/Getty) By the time the working group was set up, most of the applicable statutes of limitations had either expired or were about to expire. “A conspiratorial way of looking at it would be to say the state waited far too long to look at these cases and is now taking its sweet time investigating, while the last statutes of limitations run out,” says famed prosecutor and former New York Attorney General Eliot Spitzer. It soon became clear that the SEC wasn’t so much investigating Chase’s behavior as just checking boxes. Fleischmann received no follow-up phone calls, even though she told the investigator that she was willing to tell the SEC everything she knew about the systemic fraud at Chase. Instead, the SEC focused on a single transaction involving a mortgage company called WMC. “I kept trying to talk to them about GreenPoint,” Fleischmann says, “but they just wanted to talk about that other deal.” The following year, the SEC would fine Chase $297 million for misrepresentations in the WMC deal. On the surface, it looked like a hefty punishment. In reality, it was a classic example of the piecemeal, cherry-picking style of justice that characterized the post-crisis era. “The kid-gloves approach that the DOJ and the SEC take with Wall Street is as inexplicable as it is indefensible,” says Dennis Kelleher of the financial reform group Better Markets, which would later file suit challenging the Chase settlement. “They typically charge only one offense when there are dozens. It would be like charging a serial murderer with a single assault and giving them probation.” Soon Fleischmann’s hopes were raised again. In late 2012 and early 2013, she had a pair of interviews with civil litigators from the U.S. attorney’s office in the Eastern District of California, based in Sacramento. One of the ongoing myths about the financial crisis is that the government is outmatched by the legal talent representing the banks. But Fleischmann was impressed by the lead attorney in her case, a litigator named Richard Elias. “He sounded like he had been a securities lawyer for 10 years,” she says. “This actually looked like his idea of fun – like he couldn’t wait to run with this case.” She gave Elias and his team detailed information about everything she’d seen: the edict against e-mails, the sabotaging of the diligence process, the bullying, the written warnings that were ignored, all of it. She assumed that it wouldn’t be long before the bank was hauled into court. Instead, the government decided to help Chase bury the evidence. It began when Holder’s office scheduled a press conference for the morning of September 24th, 2013, to announce sweeping civil-fraud charges against the bank, all laid out in a detailed complaint drafted by the U.S. attorney’s Sacramento office. But that morning the presser was suddenly canceled, and no complaint was filed. According to later news reports, Dimon had personally called Associate Attorney General Tony West, the third-ranking official in the Justice Department, and asked to reopen negotiations to settle the case out of court. It goes without saying that the ordinary citizen who is the target of a government investigation cannot simply pick up the phone, call up the prosecutor in charge of his case and have a legal proceeding canceled. But Dimon did just that. “And he didn’t just call the prosecutor, he called the prosecutor’s boss,” Fleischmann says. According to The New York Times, after Dimon had already offered $3 billion to settle the case and was turned down, he went to Holder’s office and upped the offer, but apparently not by enough. [This is where the money making side of the court system comes in where a quick payout is sought to the courts for the offense (courts are all profit making institutions and have every function of finance that a bank has...) which takes precedence over justice and the large expenses of a long court case. -AK] A few days later, Fleischmann, who had by then moved back to Vancouver and was looking for work, was at a mall when she saw a Wall Street Journal headline on her iPhone: JPMorgan Insider Helps U.S. in Probe. The story said that the government had a key witness, a female employee willing to provide damaging testimony about Chase’s mortgage operations. Fleischmann was stunned. Until that moment, she had no idea that she was a major part of the government’s case against Chase. And worse, nobody had bothered to warn her that she was about to be effectively outed in the newspapers. “The stress started to build after I saw that news,” she says. “Especially as I waited to see if my name would come out and I watched my job possibilities evaporate.” Fleischmann later realized that the government wasn’t interested in having her testify against Chase in court or any other public forum. Instead, the Justice Department’s political wing, led by Holder, appeared to be using her, and her evidence, as a bargaining chip to extract more hush money from Dimon. It worked. Within weeks, Dimon had upped his offer to roughly $9 billion. In late November, the two sides agreed on a settlement deal that covered a variety of misbehaviors, including the fraud that Fleischmann witnessed as well as similar episodes at Washington Mutual and Bear Stearns, two companies that Chase had acquired during the crisis (with federal bailout aid). The newspapers and the Justice Department described the deal as a “$13 billion settlement,” hailing it as the biggest white-collar regulatory settlement in American history. The deal released Chase from civil liability. And, in what was described by The New York Times as a “major victory for the government,” it left open the possibility that the Justice Department could pursue a further criminal investigation against the bank. But the idea that Holder had cracked down on Chase was a carefully contrived fiction, one that has survived to this day. For starters, $4 billion of the settlement was largely an accounting falsehood, a chunk of bogus “consumer relief” added to make the payoff look bigger. What the public never grasped about these consumer–relief deals is that the “relief” is often not paid by the bank, which mostly just services the loans, but by the bank’s other victims, i.e., the investors in their bad mortgage securities. Moreover, in this case, a fine-print addendum indicated that this consumer relief would be allowed only if said investors agreed to it – or if it would have been granted anyway under existing arrangements. This often comes down to either forgiving a small portion of a loan or giving homeowners a little extra time to pay up in full. “It’s not real,” says Fleischmann. “They structured it so that the homeowners only get relief if they would have gotten it anyway.” She pauses. “If a loan shark gives you a few extra weeks to pay up, is that ‘consumer relief’?” The average person had no way of knowing what a terrible deal the Chase settlement was for the country. The terms were even lighter than the slap-on-the-wrist formula that allowed Wall Street banks to “neither admit nor deny” wrongdoing – the deals that had helped spark the Occupy protests. Yet those notorious deals were like the Nuremberg hangings compared to the regulatory innovation that Holder’s Justice Department cooked up for Dimon and Co. Instead of a detailed complaint naming names, Chase was allowed to sign a flimsy, 10-and-a-half-page “statement of facts” that was: (a) so short, a first-year law student could read it in the time it takes to eat a tuna sandwich, and (b) so vague, a halfway intelligent person could read it and not know anyone had done anything wrong. The ink was barely dry on the deal before Chase would have the balls to insinuate its innocence. “The firm has not admitted to violations of the law,” said CFO Marianne Lake. But the deal’s most brazen innovation was the way it bypassed the judicial branch. Previously, federal regulators had had bad luck with judges when trying to dole out slap-on-the-wrist settlements to banks. In a pair of celebrated cases, an unpleasantly honest federal judge named Jed Rakoff had rejected sweetheart deals worked out between banks and slavish regulators and had commanded the state to go back to the drawing board and come up with real punishments. Seemingly not wanting to deal with even the possibility of such a thing happening, Holder blew off the idea of showing the settlement to a judge. The settlement, says Kelleher, “was unprecedented in many ways, including being very carefully crafted to bypass the court system. . . . There can be little doubt that the DOJ and JP-Morgan were trying to avoid disclosure of their dirty deeds and prevent public scrutiny of their sweetheart deal.” Kelleher asks a rhetorical question: “Can you imagine the outcry if [Bush-era Attorney General] Alberto Gonzales had gone into the backroom and given Halliburton immunity in exchange for a billion dollars?” The deal was widely considered a good one for both sides, but Chase emerged with barely a scratch. First, the ludicrously nonspecific language surrounding the settlement put you, me and every other American taxpayer on the hook for roughly a quarter of Chase’s check. Because most of the settlement monies were specifically not called fines or penalties, Chase was allowed to treat some $7 billion of the settlement as a tax write-off. [cost of doing business! -AK] Couple this with the fact that the bank’s share price soared six percent on news of the settlement, adding more than $12 billion in value to shareholders, and one could argue Chase actually made money from the deal. What’s more, to defray the cost of this and other fines, Chase last year laid off 7,500 lower-level employees. Meanwhile, per-employee compensation for everyone else rose four percent, to $122,653. But no one made out better than Dimon. The board awarded a 74 percent raise to the man who oversaw the biggest regulatory penalty ever, upping his compensation package to about $20 million. While Holder was being lavishly praised for releasing Chase only from civil liability, Fleischmann knew something the rest of the world did not: The criminal investigation was going nowhere. In the days leading up to Holder’s November 19th announcement of the settlement, the Justice Department had asked Fleischmann to meet with criminal investigators. They would interview her very soon, they said, between December 15th and Christmas. But December came and went with no follow-up from the DOJ. She began to wonder: If she was the government’s key witness, how was it possible that they were still pursuing a criminal case without talking to her? “My concern,” she says, “was that they were not investigating.” The government’s failure to speak to Fleischmann lends credence to a theory about the Holder-Dimon settlement: It included a tacit agreement from the DOJ not to pursue criminal charges in earnest. It sounds outrageous, but it wouldn’t be the first time that the government used a wink and a nod to dispose a bank of major liability without saying so publicly. Back in 2010, American Lawyer revealed Goldman Sachs wanted a full release from liability in a dozen crooked mortgage deals, while the SEC didn’t want to give the bank such a big public victory. So the two sides quietly agreed to a grimy compromise: Goldman agreed to pay $550 million to settle a single case, and the SEC privately assured the bank that it wouldn’t recommend charges in any of the other deals. As Fleischmann was waiting for the Justice Department to call, Chase and its lawyers had been going to tremendous lengths to keep her muzzled. A number of major institutional investors had sued the bank in an effort to recover money lost in investing in Chase’s fraud-ridden home loans. In October 2013, one of those investors – the Fort Worth Employees’ Retirement Fund – asked a federal judge to force Chase to grant access to a series of current and former employees, including Fleischmann, whose status as a key cooperator in the federal investigation had made headlines in The Wall Street Journal and other major media outlets. In response, Dorothy Spenner, an attorney representing Chase, told the court that Fleischmannwas not a “relevant custodian.” In other words, she couldn’t testify to anything of importance.Federal Magistrate Judge James C. Francis IV took Chase’s lawyers at their word and rejected the Fort Worth retirees’ request for access to Fleischmann and her evidence. Other investors bilked by Chase also tried to speak to Fleischmann. The Federal Home Loan Bank of Pittsburgh, which had sued Chase, asked the court to force Chase to turn over a copy of the draft civil complaint that was withheld after Holder’s scuttled press conference. The Pittsburgh litigants also specified that they wanted access to the name of the state’s cooperating witness: namely, Fleischmann. In that case, the judge actually ordered Chase to turn over both the complaint and Fleischmann’s name. Chase stalled. Later in the fall, the judge ordered the bank to produce the information again; it stalled some more. Then, in January 2014, Chase suddenly settled with the Pittsburgh bank out of court for an undisclosed amount. Months after being ordered to allow Fleischmann to talk, they once again paid a stiff price to keep her testimony out of the public eye. Chase’s determination to hide its own dirt while forcing Fleischmann to keep her secret was becoming more and more absurd. “It was a hard time to look for work,” she says. All that prospective employers knew was that she had worked in a department that had just been dinged with what was then the biggest regulatory fine in the history of capitalism. According to the terms of her confidentiality agreement, she couldn’t even tell them that she’d tried to keep the bank from committing fraud. Despite it all, Fleischmann still had faith that the Justice Department or some other federal agency would make things right. “I guess I was just a trusting person,” she says. “I wasn’t cynical. I kept hoping.” One day last spring, Fleischmann happened across a video of Holder giving a speech titled “No Company Is Too Big to Jail.” It was classic Holder: full of weird prevarication, distracting eye twitches and other facial contortions. It began with the bold rejection of the idea that overly large financial institutions would receive preferential treatment from his Justice Department. Then, within a few sentences, he seemed to contradict himself, arguing that one must apply a special sort of care when investigating supersize banks, tweaking the rules so as not to upset the world economy. “Federal prosecutors conducting these investigations,” Holder said, “must go the extra mile to coordinate closely with the regulators who oversee these institutions’ day-to-day operations.” That is, he was saying, regulators have to agree not to allow automatic penalties to kick in, so that bad banks can stay in business. Fleischmann winced. Fully fluent in Holder’s three-faced rhetoric after years of waiting for him to act, she felt that he was patting himself on the back for having helped companies survive crimes that otherwise might have triggered crippling regulatory penalties. As she watched in mounting outrage, Holder wrapped up his address with a less-than-reassuring pronouncement: “I am resolved to seeing [the investigations] through.” Doing so, he added, would “reaffirm” his principles. Or, as Fleischmann translates it: “I will personally stay on to make sure that no one can undo the cover-up that I’ve accomplished.” That’s when she decided to break her silence. “I tried to go on with the things I was doing, but I just stopped sleeping and couldn't eat,” she says. “It felt like I was trying to keep this secret and my body was literally rejecting it.” Ironically, over the summer, the government contacted her again. A new set of investigators interviewed her, appearing to have restarted the criminal case. Fleischmann won’t comment on that investigation. Frustrated as she has been by the decisions of the higher-ups in Holder’s Justice Department, she doesn’t want to do anything to get in the way of investigators who might be working the case. But she emphasizes she still has reason to be deeply worried that nothing will be done. Even if the investigators build strong cases against executives who oversaw Chase’s fraud, Holder or whoever succeeds him can still make the whole thing disappear by negotiating a soft landing for the company. “That’s the thing I’m worried about,” she says. “That they make the whole thing disappear. If they do that, the truth will never come out.” In September, at a speech at NYU, Holder defended the lack of prosecutions of top executives on the grounds that, in the corporate context, sometimes bad things just happen without actual people being responsible.“Responsibility remains so diffuse, and top executives so insulated,” Holder said, “that any misconduct could again be considered more a symptom of the institution’s culture than a result of the willful actions of any single individual.” In other words, people don’t commit crimes, corporate culture commits crimes! It’s probably fortunate that Holder is quitting before he has time to apply the same logic to Mafia or terrorism cases. Fleischmann, for her part, had begun to find the whole situation almost funny. “I thought, ‘I swear, Eric Holder is gas-lighting me,’ ” she says. Ask her where the crime was, and Fleischmann will point out exactly how her bosses at JPMorgan Chase committed criminal fraud: It’s right there in the documents; just hand her a highlighter and some Post-it notes – “We lawyers love flags” – and you will not find a more enthusiastic tour guide through a gazillion-page prospectus than Alayne Fleischmann. She believes the proof is easily there for all the elements of the crime as defined by federal law – the bank made material misrepresentations, it made material omissions, and it did so willfully and with specific intent, consciously ignoring warnings from inside the firm and out. She'd like to see something done about it, emphasizing that there still is time. The statute of limitations for wire fraud, for instance, has not run out, and she strongly believes there’s a case there, against the bank’s executives. She has no financial interest in any of this, no motive other than wanting the truth out. But more than anything, she wants it to be over. In today’s America, someone like Fleischmann – an honest person caught for a little while in the wrong place at the wrong time – has to be willing to live through an epic ordeal just to get to the point of being able to open her mouth and tell a truth or two. And when she finally gets there, she still has to risk everything to take that last step. “The assumption they make is that I won’t blow up my life to do it,” Fleischmann says. “But they’re wrong about that.” Good for her, and great for her that it’s finally out. But the big-picture ending still stings. She hopes otherwise, but the likely final verdict is a Pyrrhic victory. Because after all this activity, all these court actions, all these penalties (both real and abortive), even after a fair amount of noise in the press, the target companies remain more ascendant than ever. The people who stole all those billions are still in place. And the bank is more untouchable than ever – former Debevoise & Plimpton hotshots Mary Jo White and Andrew Ceresny, who represented Chase for some of this case, have since been named to the two top jobs at the SEC. As for the bank itself, its stock price has gone up since the settlement and flirts weekly with five-year highs. They may lose the odd battle, but the markets clearly believe the banks won the war. Truth is one thing, and if the right people fight hard enough, you might get to hear it from time to time. But justice is different, and still far enough away. | ||||||||
Kenyan Doctors Find Anti-Fertility Agent in UN Tetanus Vaccine Posted: 08 Nov 2014 02:31 AM PST
http://brownpelicanla.com/issue/brown-pelican-la/article/lifesitenews-a-mass-sterilization-exercise-kenyan-doctors-find-anti-fertility-agent-in-un-tetanus-vaccine1 LifeSiteNews: ‘A Mass Sterilization Exercise’: Kenyan Doctors Find Anti-Fertility Agent in UN Tetanus Vaccine Fri, Nov 07, 2014 By Steve Weatherbe, LifeSiteNews, Nov 6, 2014 ...Kenya Catholic Doctors Association stated, “This proved right our worst fears; that this WHO campaign is not about eradicating neonatal tetanus but a well-coordinated forceful population control mass sterilization exercise using a proven fertility regulating vaccine. This evidence was presented to the Ministry of Health before the third round of immunization but was ignored.”... Kenya’s Catholic bishops are charging two United Nations organizations with sterilizing millions of girls and women under cover of an anti-tetanus inoculation program sponsored by the Kenyan government. According to a statement released Tuesday by the Kenya Catholic Doctors Association, the organization has found an antigen that causes miscarriages in a vaccine being administered to 2.3 million girls and women by the World Health Organization and UNICEF. Priests throughout Kenya reportedly are advising their congregations to refuse the vaccine. “We sent six samples from around Kenya to laboratories in South Africa. They tested positive for the HCG antigen,” Dr. Muhame Ngare of the Mercy Medical Centre in Nairobi told LifeSiteNews. “They were all laced with HCG.” Dr. Ngare, spokesman for the Kenya Catholic Doctors Association, stated in a bulletin released November 4,“This proved right our worst fears; that this WHO campaign is not about eradicating neonatal tetanus but a well-coordinated forceful population control mass sterilization exercise using a proven fertility regulating vaccine. This evidence was presented to the Ministry of Health before the third round of immunization but was ignored.” But the government says the vaccine is safe. Health Minister James Macharia even told the BBC, “I would recommend my own daughter and wife to take it because I entirely 100% agree with it and have confidence it has no adverse health effects.” Oddly, his phrasing suggests neither has actually received the vaccine. And Dr. Collins Tabu, head of the Health Ministry’s immunization branch, told the Kenyan Nation, that “there is no other additive in the vaccine other than the tetanus antigen.” Tabu said the same vaccine has been used for 30 years in Kenya. Moreover, “there are women who were vaccinated in October 2013 and March this year who are expectant. Therefore we deny that the vaccines are laced with contraceptives.” Newspaper stories also report women getting pregnant after being vaccinated. Responds Dr. Ngare: “Either we are lying or the government is lying. But ask yourself, ‘What reason do the Catholic doctors have for lying?’” Dr. Ngare added: “The Catholic Church has been here in Kenya providing health care and vaccinating for 100 years for longer than Kenya has existed as a country.” Dr. Ngare told LifeSiteNews that several things alerted doctors in the Church’s far-flung medical system of 54 hospitals, 83 health centres, and 17 medical and nursing schools to the possibility the anti-tetanus campaign was secretly an anti-fertility campaign. Why, they ask does it involve an unprecedented five shots (or “jabs” as they are known, in Kenya) over more than two years and why is it applied only to women of child-bearing years, and why is it not being conducted without the usual fanfare of government publicity? “Usually we give a series three shots over two to three years, we give it anyone who comes into the clinic with an open wound, men, women or children.” said Dr. Ngare. “If this is intended to inoculate children in the womb, why give it to girls starting at 15 years? You cannot get married till you are 18.” The usual way to vaccinate children is to wait till they are six weeks old.” But it is the five-vaccination regime that is most alarming. “The only time tetanus vaccine has been given in five doses is when it is used as a carrier in fertility regulating vaccines laced with the pregnancy hormone, Human Chorionic Gonadotropin (HCG) developed by WHO in 1992.” It is HCG that has been found in all six samples sent to the University of Nairobi medical laboratory and another in South Africa. The bishops and doctors warn that injecting women with HCG , which mimics a natural hormone produced by pregnant women, causes them to develop antibodies against it. When they do get pregnant, and produce their own version of HCG, it triggers the production of antibodies that cause a miscarriage. [AK Note: until recently HCG was a popular weight loss supplement in the USA. Men do not naturally produce this hormone, it secreted by the placenta during pregnancy. The antigen response and resulting infertility may underscore the reason for banning it in the USA for weight loss... -AK] “We knew that the last time this vaccination with five injections has been used was in Mexico in 1993 and Nicaragua and the Philippines in 1994,” said Dr. Ngare. “It didn’t cause miscarriages till three years later,” which is why, he added, the counterclaims that women who got the vaccination recently and then got pregnant are meaningless. Ngare said WHO tried to bring the same anti-fertility program into Kenya in the 1990s. “We alerted the government and it stopped the vaccination. But this time they haven’t done so.” Ngare also contrasted the secrecy of this campaign with the usual fanfare accompanying national vaccination efforts. “They usually bring all the stakeholders together three months before the campaign, like they did with polio a little while ago. And they use staff in all the centres to give out the vaccine.” But with this anti-tetanus campaign, “only a few operatives from the government are allowed to give it out. They come with a police escort. They take it away with them when they are finished.Why not leave it with the local medical staff to administer?” Brian Clowes of Human Life International in Virginia told LifeSite News that WHO was not involved in the Nicaragua, Mexican and Philippines campaigns. “They try to maintain a spotless record. They let organizations like United Nations Population Fund and USAID do the dirty work.” In the previous cases, said Clowes, the vaccinators insisted their product was pure until it was shown not to be. Then they claimed the positive tests for HCG were isolated, accidental contaminations in the manufacturing process. LifeSiteNews has obtained a UN report on an August 1992 meeting at its world headquarters in Geneva of 10 scientists from “Australia, Europe, India and the U.S.A” and 10 “women’s health advocates” from around the world, to discuss the use of “fertility regulating vaccines.” It describes the “anti-Human Chorionic Gonadotropin vaccine” as the most advanced. One million Kenyan women and girls have been vaccinated so far with another 1.3 million to go. The vaccination is targeting women, according to the government, in order to inoculate their children in the womb against tetanus as well. The government says 550 children die of tetanus yearly. In covering the contest of words the pro-government Nation found plenty of women who had been vaccinated and were now pregnant, even one who was the wife of a former Catholic priest who left the Church to marry. The paper ignored Kenya’s reliance on the Catholic medical system, while setting the bishops’ stand in a questionable historical context of irrational responses “largely based on religious beliefs,” the more recent murder of vaccination teams in Nigeria, and even of CIA conspiracy theories. Why would the UN want to suppress the population in developing countries? “Racism,” is Brian Clowes’ first explanation. “Also, the developed countries want to get hold of their natural resources. And lately, there is the whole bogus global warming thing.” Dr. Ngare said it was the Catholic Church’s hope that the government could have resolved the matter quietly by testing the vaccine. “But the government has chosen to be combative,” forcing Kenya’s bishops and Catholic doctors to go public. WHO’s Kenyan office and several WHO media contacts in Washington, D.C. failed to respond to LifeSiteNews enquiries over a 24-hour period. https://www.lifesitenews.com/news/a-mass-sterilization-exercise-kenyan-doctors-find-anti-fertility-agent-in-u | ||||||||
The Way Frozen Bank Accounts are used by the West Posted: 08 Nov 2014 01:26 AM PST
What isn't stated in this article is how many trillions in derivatives can be created from the "frozen money"... and its money they likely won't have to release for quite a while... -AK http://www.veteranstoday.com/2014/11/06/neo-how-are-frozen-bank-accounts-used-by-the-west/ Thursday, November 6th, 2014 Posted by Jim W. Dean NEO – How are Frozen bank accounts used by the West? The Way Frozen Bank Accounts are used by the West … by Sofia Pale, … with New Eastern Outlook, Moscow ________ [ Editor's note: Sofia Pale takes us into the murky waters of asset confiscation and the under the radar scandal it has become. Identified and seized funds seem to remain under control of the banks holding them for their use for years and years. When we first heard the stories of Gaddafi’s hidden stolen funds being run down by investigators, we expected a repatriation delay while the new government was going through its birthing process. But here we are nearing the end of 2014, and we learn that the banks are still sitting on most of those billions. An unknown part of this story is how the “non bank” assets of Mr. G have been looted via a “finders keepers” game. We first learned through our sources that entire warehouses of Gaddafi-stashed goods in France were just being grabbed by those lucky enough to get there first, with no, or “adjusted” accounting being made to the Libyan government. Much of this was driven by a cold unfortunate reality, “If I don’t steal it, the next guy coming behind me will, so the Libyan people will never see it anyway… so better me than the other guy.” France of course might have felt they deserved to be refunded its out-of-pocket no-fly-zone expenses. The public knows little about this, and governments and politicians like that just fine. Why?... because most of this “captured” wealth will end up in political coffers, which are always hungry, and that builds great loyalty when the loot is divided among the faithful... Jim W. Dean ] - First published … March 5, 2014 -  Since accounts of PEPs are usually registered in the name of nominees in offshore jurisdictions, sometimes it is very difficult to track the real beneficiaries officially (i.e., true owner of the accounts). The UK was the first to address this problem in 2012-2013, by ordering its banks to disclose all real beneficiaries in their corporate registries. Britain has always been a favourite place for concealing illegally acquired funds of foreign PEPs. Soon, other EU countries followed its example.
Being inspired by the success of appropriating illegally acquired wealth of foreign PEPs who believed in the inviolability of their deposits in safe European banks until recently, Europe did not stop at that, and went further. Following the successful example of the UK in February 2014, the European Union also adopted provisions for the establishment of registers of ultimate owners of companies and trusts in the EU countries. Given that, according to the Bloomberg agency, more than $1 trillion is concealed from taxes in Europe annually, the “cash crop” is going to be rich for European banks. The rules have been tightened so much that the funds on the accounts are frozen in case of “suspicious transactions” at first,and then an investigation is conducted from what source – legal or not – the money was received. Libya
The most glaring example is blocking the assets owned by Libyan leader Muammar Gaddafi by banks all over the world in 2011. According to official estimates, the amount did not exceed $150 billion, but new players on the political field in Libya claimed that it was a matter of at least $1 trillion, and they would like to see it in their country (or in their pockets, depending on the circumstances). Be that as it may, the U.S. retained a considerable part of Gaddafi’s assets – $30 billion, calling it the largest freezing of foreign assets in its history. However, soon the Netherlands, which had blocked $3 billion of the “Libyan Treasure” in their banks, “assigned” $100 million to Libya as a part of the WHO program, aimed at supplying medications and humanitarian aid to the country. The U.S. unblocked $1.5 billion; France unblocked $260 million, Italy promised to return $350 million for the restoration of the country. Meanwhile, the assets of $2.4 billion in Canada, $1.7 billion in Austria, $1.5 billion in the UK, and modest $2.8 million in Germany remained untouched. This is not to mention Libyan accounts in other banks around the world. However, after a simple addition of all these sums, it becomes clear that the lion’s share of Libyan funds remained in foreign banks. A number of foreign media publications called such a situation as “thoughtful plundering of the entire state”. We need hardly mention that the death of the real beneficiary, M. Gaddafi, came in handy for the banks that had blocked Libyan money, as he would never be able to prove in what way – legal or illegal – he got these funds, and certainly, he would not be able to get even a small part of them. Cyprus
According to preliminary estimates of Moody’s agency, concealed Russian owners of accounts in Cyprus could lose $19 billion on frozen accounts (at that, the European Union allocated $10 billion for the salvation of the Cypriot economy). Fortunately, Russian interests in Cyprus were so strong that the board of directors of the Bank of Cyprus, the country’s largest bank, included six representatives of Russian business circles, who promised to organize the work of the bank and to restore the trust of Russian investors, at least partially. The events in Cyprus led to an unexpected proposal from the Russian government for the establishment of an offshore zone with about 10% tax rate in the Far East. In March 2013, Russian Prime Minister Dmitry Medvedev announced an initiative for the creation of the country’s own “Cyprus” on the Kuril Islands or Sakhalin. Then in October of the same year, he repeated his intention, talking about the prospect of creation of a free economic zone, of the Singapore type, as a variant for the development of the Far East. While Russia thought about the development of an effective economic model capable of becoming useful for both, the development of business in the country and attraction of foreign capital, the United States continued to follow the old scenario, freezing accounts of its PEPs in Switzerland and of foreign PEPs in its territory. Looking for various political reasons like the “Magnitsky List”, disgraced Ukrainian PEPs, rulers from the Central Asia, Latin America and Africa and their families, American treasury receives billions of dollars annually. It does not have to apply much effort for this, nor does it inform the world in what amounts and for what purposes it uses the money acquired in this way. Asset Freezing becomes a wildfire Other countries also followed the example of the United States and the European Union. In December 2013, Australia froze $30 million on the accounts of several Russians from Irkutsk, who transferred illegally acquired funds through China and Hong Kong and raised suspicions of vigilant Australians for that reason. In January 2014, China will start mastering the practice of freezing suspicious assets, related to terrorist activities. Earlier in 2013, the Heavenly Empire blocked $1 billion in secret accounts of North Korean leader Kim Jong-un. By the way, Russia adopted this useful law in mid-2013, which also requires banks to indicate the identity of the true beneficiary of the account. It is quite obvious that blocking assets acquired from a dubious source is a good way to replenish the state treasury. In addition, it is good because it allows to “kill two birds with one stone” – to reveal really criminal activities and… freeze them in time. However, a number of countries, primarily the United States, have started using this instrument as an effective tool to “control” the activities of political leaders and activists in different countries. Their foreign bank accounts, carefully monitored with the technical capabilities of U.S. intelligence, have become a good lever to compel them into political activities advantageous for certain Western circles, otherwise such accounts may be frozen. Another conclusion, which suggests itself – one should not tease foreign banks with their tempting capitals; one should keep them at home. In the case of Russia, one should wait for “Cyprus in the Kurils”. After all, the Americans got their “offshore financial centre” in Delaware at last, where most major U.S. corporations are registered – and they have never regretted it.____________________________ Sofia Pale, PhD, Researcher at the Center for Southeast Asia, Australia and Oceania, Institute of Oriental Studies of the Russian Academy of Sciences, exclusively for the online magazine “New Eastern Outlook.” Editing: Jim W. Dean and Erica P. Wissinger |
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