More betrayal from Trump: Commutes sentence of the poster boy for employing illegal aliens

Trump on Wednesday commuted the sentence of kosher meat producer Sholom Rubashkin, serving 27 years on 86 counts of bank fraud and money laundering.

From the story here:

President Trump issued his first prison commutation Wednesday to a man whose business was caught employing 389 illegal immigrants in a single shift, dismaying anti-illegal immigration advocates and a former prosecutor on the case. ...

Prosecutors said at sentencing that Rubashkin was found to have "cheated a bank and others out of a staggering amount of money — more than $26 million." His conviction on 86 federal counts was upheld on appeal.

Democrat National Committee employee and convicted felon Robert Creamer resigns after O'Keefe video shows him planning to pay people to incite violence at Trump rallies

Thinks you don't deserve to keep all your money

The Democrats have had no problem with the guy up to now even though he's a convicted felon. And guess who else has no problem with him? His wife, Democrat commie Representative Jan Schakowsky (IL-9):

See how fast Wikipedia updates itself:

Robert Creamer (born 1947) is an American political consultant, community organizer, and author. He is the husband of Jan Schakowsky, the Congressional Representative for Illinois's 9th congressional district. His firm, Democracy Partners, works with issue campaigns. He also leads the nonprofit group Americans United for Change.

In 2005, Creamer pleaded guilty to tax violations and $2.3 million in bank fraud in relation to his operation of public interest groups in the 1990s. He was convicted and sentenced to five months in prison at Terre Haute and eleven months house arrest. ...

In October 2016, James O'Keefe released a hidden-camera video appearing to show Creamer and other campaign staffers for Hillary Clinton hiring people to incite violence at rallies for her opponent, Donald Trump. Creamer also works for Democracy Partners. As a result of the video, Creamer announced his resignation from the Democratic National Committee.

'Our Citizens Ascribe Our Distresses To Every Thing But Their True Cause, The Banking System'

With its fictitious capital, otherwise known as credit without collateral, which enriches only those who issue it:

"The enormous abuses of the banking system are not only prostrating our commerce, but producing revolution of property, which without more wisdom than we possess, will be much greater than were produced by the revolutionary paper. That too had the merit of purchasing our liberties, while the present trash has only furnished aliment to usurers and swindlers. The banks themselves were doing business on capitals, three fourths of which were fictitious: and, to extend their profit they furnished fictitious capital to every man, who having nothing and disliking the labours of the plough, chose rather to call himself a merchant to set up a house of 5000. D. a year expence, to dash into every species of mercantile gambling, and if that ended as gambling generally does, a fraudulent bankruptcy was an ultimate resource of retirement and competence. This fictitious capital probably of 100. millions of Dollars, is now to be lost, and to fall on some body; it must take on those who have property to meet it, and probably on the less cautious part, who, not aware of the impending catastrophe have suffered themselves to contract, or to be in debt, and must now sacrifice their property of a value many times the amount of their debt. We have been truly sowing the wind, and are now reaping the whirlwind. If the present crisis should end in the annihilation of these pennyless and ephemeral interlopers only, and reduce our commerce to the measure of our own wants and surplus productions, it will be a benefit in the end. But how to effect this, and give time to real capital, and the holders of real property, to back out of their entanglements by degrees requires more knolege of Political economy than we possess. I believe it might be done, but I despair of it’s being done. The eyes of our citizens are not yet sufficiently open to the true cause of our distresses. They ascribe them to every thing but their true cause, the banking system; a system, which, if it could do good in any form, is yet so certain of leading to abuse, as to be utterly incompatible with the public safety and prosperity. At present all is confusion, uncertainty and panic."

-- Thomas Jefferson, to Richard Rush, June 22, 1819 

(source)

Citigroup VP Pleads Guilty to Embezzling Millions Between '03 and '10

And he's only 35 NOW, according to this story:

A former vice president for Citigroup pleaded guilty Tuesday to embezzling more than $22 million from the company and funneling the money to his personal bank account.

Gary Foster, 35, pleaded guilty to bank fraud, admitting that he took the money between 2003 and 2010. He appeared in U.S. district court in Brooklyn before Judge Eric Vitaliano.

Attorneys General of Just Four States Oppose $20 Billion Get Out Of Jail Card For Banks

And rightly so. Absolving the banks from further litigation in the robosigning and securitization scandal for such a paltry sum would be like getting away with murder.

For more, see here:

If banks are released from liability regarding documentation practices, some industry officials believe they would be able to evade state lawsuits directed at how they bundled the loans into securities.

The attorneys-general of New York, Delaware, Massachusetts and Nevada are probing such securitization matters, and have already indicated to the other states that they did not agree with the counterproposal.

Catherine Cortez Masto, Nevada’s legal officer, last week charged Bank of America’s Countrywide unit with failing to properly transfer mortgages into the trusts that issued securities to investors, and for fraudulently pursuing home seizures anyway. New York’s Eric Schneiderman has indicated his office has reached similar findings.

Bank Failure Friday: 6 Tonight, 157 Year to Date

This is an updated post which corrects information previously posted in error:

#152 was The Bank of Miami N.A., Coral Gables, FL, costing the FDIC $64 million. Stated assets were short by 44%.

#153 was Chestatee State Bank, Dawsonville, GA, costing the FDIC $75.3 million. Stated assets were short by 48%.

#154 was Appalachian Community Bank FSB, McCaysville, GA, costing the FDIC $26 million. Stated assets were short by 35%.

#155 WAS UNITED AMERICAS BANK N.A., ATLANTA, GA, COSTING THE FDIC $75.8 MILLION, NOT $195.8 MILLION AS PREVIOUSLY POSTED. STATED ASSETS WERE SHORT BY 105%. STATED ASSETS WERE $242.3 MILLION WHEN TRUE ASSETS WERE MORE LIKE $118 MILLION. SEE WHAT HAPPENS TO YOU WHEN YOU TRY TO GET A LOAN AND THEY FIND OUT YOU EXAGGERATED YOUR ASSETS ON PAPER BY 105% AND SIGN YOUR NAME TO IT. NORMALLY YOU GO TO JAIL FOR FRAUD AND PERJURY, BUT IF YOU'RE A BANK YOU GET A TAXPAYER BAILOUT. 

#156 was First Southern Bank, Batesville, AR, costing the FDIC $22.8 million. Stated assets were short by 44%.

#157 was Community National Bank, Lino Lakes, MN, costing the FDIC $3.7 million. Stated assets were short by 26%.

Next Friday is Christmas Eve, and the Friday after is New Year's Eve, so I'm guessing that's a wrap for 2010: 157 bank failures vs. 140 last year.

But you never know.

Foreclosure and Securitization Fraud: Conjuring Collateral Documents From Thin Air

Yves Smith of Naked Capitalism writing for the New York Times zeroes in on the fraud which lies at the heart of the mortgage securitization and foreclosure crisis:

Consider a company called Lender Processing Services, which acts as a middleman for mortgage servicers and says it oversees more than half the foreclosures in the United States. To assist foreclosure law firms in its network, a subsidiary of the company offered a menu of services it provided for a fee.

The list showed prices for “creating” — that is, conjuring from thin air — various documents that the trust owning the loan should already have on hand. The firm even offered to create a “collateral file,” which contained all the documents needed to establish ownership of a particular real estate loan. Equipped with a collateral file, you could likely persuade a court that you were entitled to foreclose on a house even if you had never owned the loan.

That there was even a market for such fabricated documents among the law firms involved in foreclosures shows just how hard it is going to be to fix the problems caused by the lapses of the mortgage boom. No one would resort to such dubious behavior if there were an easier remedy.

Read the rest of her excellently presented discussion here.

Some Banksters May Yet Go To Jail for Fraud

According to a story today from CNBC.com:

In a number of cases in the past year — sources put it between five and ten — auditors have found enough evidence of fraud by bankers that they referred the cases to criminal investigators within the Treasury Inspector General’s office for a more detailed analysis.

The rest is here.

Obama and Company: Experts at Bankruptcy

The Chicago Sun Times is reporting:

On Feb. 14, 2006, newly obtained records show, the bank [Democrat Senate hopeful Alexi Giannoulias' Broadway Bank] made a $22.75 million loan to a company called Riverside District Development LLC, whose owners, it turns out, included Rezko.

Antoin Rezko, of a Syrian Catholic family, was convicted of fraud and bribery charges in 2008 and once had close ties to Illinois Governor Rod Blagojevich, now on trial, and to President Barack Obama.

The Sun Times also reports:

According to Giannoulias . . . Riverside District Development paid off the Broadway Bank loan with money it obtained from a $27 million loan from another financial institution: Mutual Bank.

The president of Mutual, Amrish Mahajan, was also a fundraiser, like Rezko, for Blagojevich.

Mutual Bank, Harvey, IL, failed on July 31, 2009, costing the FDIC $696 million. Its assets of $1.6 billion were overvalued by $696 million, or 77%.

Broadway Bank failed April 23, 2010, costing the FDIC $394.3 million. Its assets of $1.2 billion were overstated by $494.3 million, or 70%.

Read the complete story, here.

WHERE BANKS' BAD PAPER GOES TO DIE

The taxpayer-backstopped Fanny and Freddie, of course:

The Obama administration is continuing one of the more horrific policies of the Bush administration: Using the GSEs as a back door bailout for the rest of the banking sector: These banks are selling their garbage to the GSEs — and according to some anecdotal evidence, are getting pretty close to full boat (100 cents on the dollar) for these bad loans.

Hence, Fannie and Freddie have become a dumping ground for all manner of bad bank loans.

The GSEs have had their own problems over the years — accounting fraud, recklessly chasing market share, lowering loan quality, etc. — but they have now become . . . the last stop for every crappy mortgage ever written.

Ritholtz has more here, on the story from Bloomberg.

Failed Broadway Bank Linked To Giorango, Rezko, Giannoulias And Obama

John McCormick for Bloomberg.com is reporting some interesting details about Broadway Bank of Chicago, IL, which failed yesterday:

April 24 (Bloomberg) -- U.S. Senate candidate Alexi Giannoulias, the Democratic candidate seeking the seat once held by President Barack Obama in Illinois, vowed to press on with his campaign after regulators seized the bank his family owns. ...

Broadway Bank had been operating since January under terms of a consent order with the Federal Deposit Insurance Corp. because of commercial real-estate loan losses. ...

Some Broadway Bank loans have drawn notice, including those made to Michael Giorango, a convicted bookmaker and prostitution-ring promoter. The bank also made loans to convicted Illinois influence peddler Antoin “Tony” Rezko and a family accused of having connections to organized crime. ...

In March, a Chicago restaurateur who gave more than $100,000 to Giannoulias -- and $4,600 to Obama -- was charged with defrauding banks by writing $1.8 million in bad checks.

Read the complete story here.

Financial Reform: Of Torches And Pitchforks

Edward Harrison of creditwritedowns.com weighs in on the Goldman case, but can't quite bring himself to commit to the view that this is all just for show and will do nothing but continue the lie that is America and the farce of extend and pretend in particular which government has modeled for decades, and the consumer, business and the banking system have dutifully imitated in their turn. Abandon hope all ye who enter here: Everything Obama says comes with an expiration date. The following excerpts come from here:As I left for the conference, I chatted with a friend who is far from the financial sector. Her take puts this debate into perspective. The issues are pretty easy to understand:We have had an economic crisis the likes of which we haven’t seen since the Great Depression. People are still losing their jobs and homes as a direct result of the boom and bust caused by the financial sector. Yet, we have bailed the banks out with taxpayer money and the bankers act like they never needed the bailout, didn’t cause the crisis or some other ridiculous argument of that ilk. In fact, they are rewarding themselves with huge bonuses while everyone else is still in a world of hurt.Forget about whether these arguments make any sense. They don’t. The only thing ordinary Americans need to know is that these people are paying themselves obscene amounts of money while everyone else is suffering despite the fact that we bailed them out of the crisis they caused. That’s the pitchfork thesis in a nutshell.  All of the other stuff is a sideshow. Johnson confirmed that this is exactly what people have been telling him in his book signings all across America. To my mind, this is what the Goldman fraud case is all about. Do you think the political payoff would be as high for going after JPMorgan Chase? Goldman is the vampire squid in mainstream America’s eyes and the Feds know this. That is why they have been targeted.

Asset Value Lies Are S.O.P. In Banking

Karl Denninger has a new post here reflecting on a recent entry at Institutional Risk Analytics on "Events of Default" which shines the light on approximately $500 billion in private collateralized debt obligations which continue to be carried by the banks at par value but which are in fact nearly worthless:

It's called legalized accounting fraud, and I've been hollering about it for three years. As the loss severities have continued to climb and the impact accelerate[s] into other areas of securitized debt, the so-called "regulators" have scrambled to find new corners of the carpet to allow the banksters to hide the truth under.

A culture built on lies cannot endure.

"The Banks Must Be Restrained"

Total bank failures year to date reached 106 yesterday, bringing the total cost to the FDIC Deposit Insurance Fund this year to about $25 billion, with only about $100 billion to go, according to the FDIC's own projections.

The FDIC likes to take over banks on Friday afternoons, believing you won't notice it as readily with the weekend intervening before the next regular day of business. They wouldn't want you to panic, you know. So people who watch this stuff carefully like to call the last day of the work week "Bank Failure Friday." Yesterday, I noticed that the 106th bank to fail this year was in Itasca, Illinois, near where I used to live, and it reminded me of these words posted by Mish (who lives in Illinois) in July of 2008:

23. FDIC Chairman Sheila Bair said the FDIC is looking for ways to shore up its depleted deposit fund, including charging higher premiums on riskier brokered deposits.

24. There is roughly $6.84 Trillion in bank deposits. $2.60 Trillion of that is uninsured. There is only $53 billion in FDIC insurance to cover $6.84 Trillion in bank deposits. Indymac will eat up roughly $8 billion of that.

25. Of the $6.84 Trillion in bank deposits, the total cash on hand at banks is a mere $273.7 Billion. Where is the rest of the loot? The answer is in off balance sheet SIVs, imploding commercial real estate deals, Alt-A liar loans, Fannie Mae and Freddie Mac bonds, toggle bonds where debt is amazingly paid back with more debt, and all sorts of other silly (and arguably fraudulent) financial wizardry schemes that have bank and brokerage firms leveraged at 30-1 or more. Those loans cannot be paid back.

What cannot be paid back will be defaulted on. If you did not know it before, you do now. The entire US banking system is insolvent.

Since those words were penned, the FDIC is planning to charge premiums several years forward to banks to the tune of $45 billion, its deposit fund is down to about $10 billion, and its troubled bank list has ballooned to over 400 banks, with nearly 300 in serious trouble. The FDIC expects to need at least another $100 billion for bailouts through 2013. Let's see, $10 billion on hand plus $45 billion charged forward = $55 billion. Only $45 billion short! Hmm. And you think we can afford to federalize health care?!

When you go down to the bank to ask for a loan to buy a house, you typically get leverage of only 5 to 1 (20% down), because nobody's got your back but you. So why does the bank get leverage to the tune of 25 to 1 (4% down)? Because of the taxpayer guarantee, that's why. And "rules" which let them, written by politicians on the take. It's high time we ended all that or this country will surely go bankrupt. Consider Citigroup.

It alone has $800 billion in "assets" off the books, and looks to be in serious trouble: suddenly this week it ended its gasoline credit card program and dramatically hiked interest rates on its other cards. Forget about the FDIC covering Citigroup with forward charged premiums to its member banks if it goes under. There isn't enough money there. The taxpayer will be on the hook. Again. Are you mad as hell yet? Are you going to take it anymore? Vote the bums out.

No wonder Jesse keeps saying, "The banks must be restrained . . . before there can be any sustained recovery."