CBS 60 Minutes Exposes Bank Fraud

While this story is not specifically related to Goldman Sachs, Goldman's mortgage and mortgage servicing entities are - I believe - involved in this fraud on the courts (and the people) as they continue to mercilessly foreclose on homes.

Yes, there are many of you who say, "if you cannot afford the payments then you should be foreclosed on" and to some degree under very different circumstances I would be he first to agree with you.  But let's look at the facts, the real facts on how this foreclosure crisis began and who was responsible for it.

The real culprits here are - you guessed it - the banks and our friends at GS.  Why are they to blame you ask?  Well, it was their decisions to lower qualification guidelines, devise creative methods of securitization to "spread the risk" and then conjour up fancy names for securities (junk) that would insure against failure.  In other words, the likes of GS (the premier bond trading company), Merrill Lynch, Bear Stearns and Lehman Bros not to mention banks such as HSBC, Deutsche Bank, JPMorgan and Bank of American, all interested in the creation of hundreds of thousands if not millions of mortgage notes for sale to a fraudulently informed investing public worldwide.  Enter please, the criminal conspiracy accomplices - the rating agencies, Moody's Standard and Poors and Fitch - who knowingly - gave these mortgage backed securites (MBS) false "AAA" ratings which in fact told the investing public that there was little risk in these investments.

So what does all this have to do with being foreclosed on legally or illegally?  A great deal.  Let's look at some logic not fact that I have researched.  As guidelines for mortgage qualifications continued to be lowered, more and more people purchased homes - sometimes multiple homes - that they truly could not afford.  These people did (notice the past tense here) deserve to be foreclosed on LEGALLY.  I believe that as the so called "mortgage meltdown" began in mid 2007. the majority of those purchasing multiple properties, second homes and even primary residences did lose these properties to the banks. (the legality question still does exist, however)

But, again, it is my belief that the majority of foreclosures since then are not due to people who over extended themselves, purchased multiple properties or second homes.  The majority of foreclosures today, I believe, are due to Great Recession which still has milllion upon millions of people unemployed.

This excessively high rate of unemployment as a result of the Great Recession and the Great Recession itself is a direct result of the extensive greed that permeated the banking industry causing them to operate fraudulently, outside the view of the SEC and other regulatory agencies.  These banks (perhaps led by the biggest bond traders of them all - GS) were the sole reason we had a worldwide economic crash all tied into mortgage securites and things called derivatives - things that you can gamble with but don't really exist.

Today it is my belief again that the majority of foreclosures are against innocent victims who through no fault of their own found themselves unemployed and perhaps stripped of their savings and found that their investments became worthless in the wake of the economic crash.

Let us also keep in mind that while the people of this country began suffering and losing the banks who created this mess to begin with all began profiting.  Our friends at GS showing greater profits then pre economic crash.  What's up with that?

Of course, our government stepped in to help but helped the wrong ones.  Instead of helping us, the people, as they are supposed to do, they chose to strip us even more of any financial freedom by bailing out those that hurt us to begin with.

Calling themselves Too Big To Fail they instilled fear into some, fooled many others and gave a good excuse for prominent (bought and paid for) politicians who knew better to fund them to the tune of trillions closing a blind eye to the multitude of criminal activities they engaged in to create their extreme wealth which then caused the financial destruction globally.


What is important about this 60 Minutes piece is that it in no uncertain terms discloses - by admission of some involved - the frauds that banks have committed in the effort to take back homes ILLEGALLY.  I emphasize illegally as this precedence could and most probably will - if left unchecked - cause a demise of our entire judicial system removing any equity that must exist giving preferential treatment above and outside of law to those that have priority status in our society such as banks.  This blatant disregard for justice and dispensation of laws in our courtrooms will create a two tier system in our country.  One system that must obey the law and be punished by it and those that do not need to obey any laws and can walk free and profit by breaking the laws.  Our courtrooms will become shams where the guilty will go free and the innocent will suffer by punishment.

This story is big and as 60 Minutes says by its title, the second wave is coming.  Illegal actions, condoned by our courts and those judges who close a blind eye to the laws they have sworn to uphold will cause the demise of this Republic as we know it and as our forefathers imagined it to be.

Freedom does not come without sacrifice but loss of freedom due to power, greed and a disregard for law is not a sacrafice any should ever have to make.

Please watch both of the video segments.  The first is the one aired, the second is one aired on their web site only as a continuation.

The next housing shock ...from CBS 60 Minutes

http://www.cbsnews.com/video/watch/?id=7361572n&tag=contentMain;contentAux Sorry, embed did not work correctly.  click on image at left to link to video.

 

 

 

 

Mortgage mess: Who really owns your mortgage?

Sorry, embed did not work correctly.  click on image at left to link to video.










This is important.  Pass this along to everyone you know.  We must put the "just" back in justice.

This is the beginning of what I am calling FORECLOSUREGATE.

Related articles

• Judges Waking Up To Fraud on the Court (theforeclosuredetonator.wordpress.com)
• Foreclosure nightmares won't end (finance.fortune.cnn.com)
• Do Banks tell the truth? (temeculahomesblog.wordpress.com)
• "Who Owns My Mortgage"...Demand To Know (theforeclosuredetonator.wordpress.com)
• Fraud-Based Economy (businessinsider.com)

Another Book About Goldman Sachs

One could suppose that any publicity is good publicity in which case Goldman Sachs probably revels in the latest book about its own profiteering. William D. Cohan has written a book about Goldma Sachs called, Money and Power: How Goldman Sachs Came to Rule the World. The title alone is rather scary.

Below are excerpts from three reviews:

Book Review: Money and Power: How Goldman Sachs Came to Rule the World by William D. Cohan
By Ian McGugan - Bloomberg Business Week

. . . .
Given Goldman's bare-knuckled attitude, Cohan depends on a wide range of unnamed sources. Judiciously relying on their insights, he has produced the frankest, most detailed, most human assessment of the bank to date. Yet the firm winds up looking in many ways like nothing more than a slightly brighter, slightly less foulmouthed version of Bear; it's just as greedy, just as arrogant, and just as prone to mistakes. Though Cohan acknowledges the firm's extraordinary ability to recruit and indoctrinate the best and brightest, what seems to truly set Goldman apart is its ability to be a half step quicker than its rivals in correcting itself.

After all, this is a firm that periodically eviscerates those who trust it most. In the 1920s, Goldman ran a Ponzi-like scheme involving investment trusts. In the 1970s, it peddled soon-to-be-worthless commercial paper for the soon-to-be-bust Penn Central Railroad. And, in 2007, the firm that prided itself on being "long-term greedy" sold gullible clients on the merits of mortgage-backed securitieswhile simultaneously shorting some of those same debt obligations. The firm has succeeded, in part, by ignoring these nastier aspects of its past. In fact, Goldman never misses an opportunity to celebrate the holier-than-thou principles laid down by former senior partner John Whitehead. Rule No. 1: Our client's interests always come first.

Money and Power suggests the bank does possess a few special powers, starting with its remarkable ability to convince some of the world's smartest young people that touting stocks, sniffing out arbitrage opportunities, and shaking down corporate clients amount to a noble calling. One illuminating anecdote in Money and Power concerns Robert Rubin, the former Goldman head who would go on to become Treasury Secretary under Bill Clinton. During his third year at the firm, back in 1969, Rubin's career path may have hit a rough patch. Sandy Lewis, who at the time ran the arbitrage department for a rival bank, tells Cohan that Rubin approached him regarding a job opportunity. Lewis explains that Rubin had grown disgusted with the Goldman way. "It's a dishonest mess," Lewis recalls Rubin saying to him, "that's making honest people dishonest."

Whether or not Rubin was seriously looking outside the firm, he stuck around and soon led Goldman into areas that had previously been considered off-limits—such as asset management—for fear of potential conflicts with clients. A former top partner—unnamed, but in a position to judge the firm's swelling appetite for profits at any cost—says Rubin encouraged a culture of undisciplined risk taking. "A lot of these practices were set up when [Rubin] was there," he tells Cohan. "The lack of a risk committee, trusting individual partners ... and letting traders become too important and being afraid to confront them if they've been big moneymakers. All that sort of stuff built up."

As profits swelled under Hank Paulson, and then Lloyd Blankfein, Goldman was edging further into trading money for its own account—and pushing the boundaries of what had previously been considered an acceptable conflict of interest. Simultaneously, the bank became more obsessive about managing the darker side of its sprawling empire. A reputational risk department, staffed by former CIA operatives and private investigators, vetted new hires and policed employees who got out of line. While the department may have missed clues about "Fabulous" Fabrice Tourre, the firm relied on its level of diligence, and it became part of the culture. "Not that they would come to my house and beat me up or something or kill my children," a former Goldman trader says. "But certainly they would drag you through court or do something to screw up your life. If you did anything to hurt that firm in any way, all bets were off."

. . . .

Read the review here

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Still Standing
by Mary Kissel - WSJ

. . . .

Mr. Cohan's complaints against Goldman seem to be that it is "ruthless" in pursuit of profit; doesn't do enough to protect its institutional clients from making bad decisions; works too closely with government; too often advises companies on both sides of a deal; and skirts close to the line of "insider trading."

The first two complaints would be better lodged against the very nature of capitalism; the third does ­address the problem of cronyism that has always existed on Wall Street. The last two complaints—about the firm's being on both sides of a deal and relying on ­"insider" knowledge—are areas worth exploring, though regulators have never drawn bright lines (in part because it is almost impossible to do so). The relationship of ­Goldman to the Fed and its "too big to fail" status definitely merit a studied critique. But Mr. ­Cohan doesn't have enough knowledgable sources or hard evidence to write a full book on such matters. Instead he gives us reams of unedited emails between Goldman insiders peppered with drivel, including nauseating missives from trader Fabrice "Fabulous Fab" Tourre boasting to his girlfriend about his genius.

. . . .

Read the rest of the review here

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Annals of C-suite dysfunction, Goldman Sachs edition
By Felix Salmon - Reuters

Ian McGugan has a good review of Bill Cohan’s huge new book on Goldman Sachs which includes an intriguing quote about how Bob Rubin “encouraged a culture of undisciplined risk taking” — something which goes directly against the reputation he’s spent many years cultivating. It comes from Chapter 15, which starts in the dangerous year of 1994 and which is full of juicy gossip about the very human frailties of the people running Goldman. Here’s more of it:

“For a long time he just sort of sat in his office,” one partner said of Corzine. “He would sit in his office breaking out in tears at various times while the firm was losing all this money.”…

As the losses in 1994 mounted, many partners became increasingly nervous that the firm was at risk… Some forty partners left Goldman at the end of 1994, the first time anything like that many partners had voted with their feet. “People resigned out of fear,” one partner said. “That should tell you something.”… Howard Silverstein, the partner in charge of Goldman’s Financial Institutions Group, left. “He was perceived as being an expert,” one partner on the Management Committee said. “And all he did was just do a simple calculation if this continues. You know: wiped out.”…

Paulson cut people, travel expenses, allowances for overseas living, and many of Goldman’s vaunted perks. He even cut back on the use of a corporate jet and recalled grueling overseas trips flying around Europe and Asia on commercial flights…

Goldman’s problems at that time weren’t only ones of cost and bad bets. A culture of undisciplined risk taking had built up over many years. “A lot of these practices were set up when [Rubin] was there,” one top partner said. “Okay? The lack of a risk committee, trusting individual partners, model-based analytics — that by God you can be smart and figure it all out — and letting traders become too important and being afraid to confront them if they’ve been big moneymakers. All that sort of stuff built up.” …

Aside from why Friedman had seemingly botched his departure, the other lingering question that remained among many of the Goldman partners was how Corzine could have emerged as the firm’s leader when he was leading the very division — fixed- income — that had lost hundreds of millions of dollars in 1994…

Goldman had selected as its new leader the very person who had just presided over a complete meltdown in Goldman’s fixed- income business and who, as a result, never fully had the trust and faith of the firm’s investment bankers. “That is one good question,” one Goldman trading partner said. “At a normal place, it would be discordant. You couldn’t imagine it. And I guess at this place, somehow you could.”

This, remember, is the world’s best investment bank. It’s worth bearing in mind when you see those eight-figure salaries and wonder whether they’re earned. And when you hear politicians bellyaching about the importance of keeping US banks “competitive” on the international stage. If this is competitive, it might well be best to just drop out of the competition all together.

Read the review here