Tag Archive: Fraud

Apr 02 2019

Trump’s Fictional Wealth

As everyone knows by now, and what every New Yorker has known since the 80’s, Donald Trump is a con artist who lie and cheat even when he is winning. Most bankers and contractors eventually learned the hard way, losing millions along the way. Donald probably only ran for president because he saw it as …

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Jun 15 2018

The Trump Foundation: Family’s Personal Piggy Bank

The New York State Attorney General has sued the Trump Foundation accusing the Trump family of essentially using the non-profit as their personal piggy bank. The New York State attorney general’s office filed a scathingly worded lawsuit on Thursday taking aim at the Donald J. Trump Foundation, accusing the charity and the Trump family of …

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Sep 15 2015

Our Lady of Perpetual Exemptions Has Closed Its Doors

As quickly as it opened its doors and our eyes to fraudulent televangelism, Our Lady of Perpetual Exemptions has closed. John Oliver, pastor and host of HBO’s “Last Week Tonight,” announced the end of his church’s mission not because they had to, they were perfectly legal, but because, as his “wife” Wanda Jo put it, “when someone send you jizz in the mail, its time to stop whatever you’re doing..”  

Warning the video below contains NSFW material.

Aug 18 2015

Welcome to the Church of Our Lady of Perpetual Exemption

We are all familiar with the televangelical  preachers that flood the airways telling their believers that they have the cure for everything from cancer to a hang nail if you just send them your money. They prey (pardon the pun) on those who can least afford to send them money while they live in the lap of luxury.They also don’t pay any taxes on their bounty.

To demonstrate the absurdity of these charlatans, John Oliver, host of “Last Week Tonight,” opened his own church with the assistance of a tax lawyer.

To expose the industry’s fraudulent activity, his team got close with leading celebrity televangelist Robert Tilton of Word of Faith Worldwide Church. After mailing Tilton $20, with a request to be added to his church’s mailing list, a correspondence was reportedly struck up, which resulted in the televangelist requesting larger and larger sums of money.

As Oliver said: “As of tonight, I’ve sent him $319 and received 26 letters – that’s almost one a week. And again, this is all hilarious until you imagine these letters being sent to someone who cannot afford what he’s asking for.”

Oliver wrapped up the segment in fitting fashion: he formed his own church. He claims to have filed paperwork for establishing Our Lady of Perpetual Exemption last week, a process he called “disturbingly easy”.

The church is now open to the public and has its own site. On it, Oliver encourages people to send cash, check or money orders to a New York PO box. The fine print states that should the church choose to wind down and dissolve in the future, “any assets belonging to the Church at that time will be distributed to Doctors Without Borders, a non-profit charitable organization that is tax-exempt under § 501(c)(3) of the Internal Revenue Code (EIN: 13-3433452) and which provides emergency medical aid in places where it is needed most”.

Bless you, John Oliver

Apr 27 2015

The Worst Doctor in Scrubs

Once a well respected and brilliant cardiac surgeon with a worldwide reputation, Dr. Mehmet Oz has taken quite a fall since a study in  British Medical Journal that less than 50% of his television advice could be backed by actual science and his appearance before a Senate subcommittee on consumer protection where he caught a harsh scolding about his diet product ads.

Last June, John Oliver, host of HBO’s “Last Week Tonight,” took on Dr. Oz in an epic segment that outlined what was problematic with him and the nutrition supplement industry. Then this month a group of ten prominent physicians sent a letter to Dr. Lee Goldman, Columbia’s Dean of the Faculties of Health Sciences and Medicine calling for Dr. Oz’s ouster from the hospital’s faculty, citing, among other reasons, his “egregious lack of integrity by promoting quack treatments and cures in the interest of personal financial gain.”

The good doctor has been doing damage control with interviews in TIME magazine, televised news media and on his show.

Once again, at the beginning of his show, John Oliver blasted him, calling him “the worst person in scrubs who has ever been on television” and included an amusing reference to actress Katherine Heigl who played a doctor on ABC’s “Grey’s Anatomy.”

“No. You are scientifically wrong about that as you are about so many things. Let’s be clear: The First Amendment protects Americans against government censorship, and that’s it. It does not guarantee you to simultaneously hold a faculty position at a prestigious private university and make misleading claims on a TV show. It absolutely protects you to say whatever you like on it, just as it protects my right to say what I think about you on mine, which is this: You are the worst person in scrubs who has ever been on television-and I’m including Katherine Heigl in that. Do you have any idea how difficult it is to be worse than Katherine Heigl? You are also the admittedly handsome ringmaster of a middling mid-afternoon snake-oil dispensary and it says something that even when you do a show with seven fake models of human feces, the biggest piece of shit on the stage has his name in the title.”

(h/t The Daily Beast)

Feb 26 2015

Is Cuomo Covering His Corrupt Tracks?

The International Business Times is reporting the New York Governor Andrew Cuomo has ordered the destruction of state government e-mails older than 90 days. Cuomo ordered this in the midst of a Federal investigation into public corruption.

In a memo obtained by Capital New York, Cuomo officials announced that mass purging of email records is beginning across several state government agencies. The timing of the announcement, which followed through on a 2013 proposal, is worth noting: The large-scale destruction of state documents will be happening in the middle of a sprawling federal investigation of public corruption in Albany. That investigation has been looking at state legislators and the Cuomo administration.

Cuomo’s move to purge state emails follows a similar move he made as state Attorney General. International Business Times confirmed that in 2007, he put in place a mass deletion policy for emails in the New York Attorney General’s office that were more than 90 days old, making it difficult for the public to know how — or whether — his office investigated bank fraud in the lead-up to the financial crisis of 2008. In the Cuomo administration’s announcement this week, the governor’s chief information officer, Maggie Miller, justified the new email purge as a cost-saving measure aimed at “making government work better.”

But former prosecutors and open-government advocates interviewed by IBTimes say the move seems designed to hide information.

According to the Capital News article, the memo (pdf) from Ms. Miller, a former Girls Scouts of America executive who was hired in December, was sent to agency heads of Friday. The article goes on tho site that over a dozen advocacy agencies sent a letter to the governor’s office (pdf) last month  arguing that the policy was out of step with federal guidelines and technologically unnecessary:

In this era, government runs on email, and access to email and electronic records has become a cornerstone of public transparency. Our groups are very concerned that the administration’s June 2013 policy of using centralized software to automatically delete state employee emails after 90 days is resulting in the destruction of emails that are considered public records under New York’s Freedom of Information Law,” wrote the groups, which were organized by Reinvent Albany. “This policy was adopted without public notice or comment. Furthermore, we are extremely concerned that the inevitable destruction of email records under your 90-day automatic deletion policy directly undermines other public accountability laws like the False Claims Act.

New York’s contract with Microsoft, which developed Office 365, allows for 50 gigabytes of e-mail storage per employee. Reinvent Albany estimated this would be enough to handle up to 30 years worth of messages. [..]

In addition to the federal seven-year standard, other states like Washington, Florida and Connecticut have retention periods of between two and five years. The Central Intelligence Agency recently proposed a three-year retention period for departing employees, and was criticized for not archiving messages for longer. Shorter retention periods are more common in corporations seeking to reduce their exposure in litigation, according to a memorandum compiled by Reinvent Albany (pdf).

After Cuomo abruptly ended his Moreland Commission that was investigating campaign finance and public corruption when it apparently got too close to his own office, US Attorney Prete Brarara began a federal probe into Albany. The timing of this order raises significant legal questions, according to Melanie Sloan, a former Clinton Justice Department official:

“This is potentially obstruction of justice,” she told IBTimes. “The only reason that the government destroys records is so no one can question what it is doing, and no one can unearth information about improper conduct. There’s no reason for New York not to preserve this information.”

Sloan said U.S. Attorney Preet Bharara, who is spearheading the Albany probe, could issue a letter to Cuomo ordering him to preserve all documents that could be relevant to the public corruption investigation. In May 2014, Bharara issued such a letter to state legislators. Bharara’s office declined to comment when asked by IBTimes if it had now issued a similar directive to Cuomo.

John Kaehny, the head of a coalition of transparency group called Reinvent Albany, said the purge order may be designed to circumvent obstruction of justice statutes that are designed to prevent deliberate document destruction.

“[The policy] may mean that you could never be accused of obstructing justice or destroying evidence because you could claim that the machine automatically deleted it,” he told IBTimes. “It creates a loophole and opportunity to destroy embarrassing emails.” [..]

Trevor Timm, executive director of the Freedom of the Press Foundation, says beyond questions about legality, the public should be concerned about how the policy may preclude journalists from reporting on state government.

“This policy will allow the Cuomo administration, in many cases, to delete newsworthy emails faster than reporters can even request them,” Timm said. “It looks like an attempt to avoid accountability.”

This lookng more and more like a cover up of Cuomo’s corruption ever since he was the state’s attorney general. Hopefully, he won’t get away with it.

Jan 08 2014

A Tale of Two Frauds

Why are these two tales of fraud not the same in the eyes of the law?

Charges for 106 in Huge Fraud Over Disability

By William K. Rashbaum and James C. McKinley Jr.JAN. 7, 2014

The retired New York City police officers and firefighters showed up for their psychiatric exams disheveled and disoriented, most following a nearly identical script.

They had been coached on how to fail memory tests, feign panic attacks and, if they had worked during the Sept. 11, 2001, terrorist attacks, to talk about their fear of airplanes and entering skyscrapers, prosecutors said. And they were told to make it clear they could not leave the house, much less find a job. [..]

Former police officers who had told government doctors they were too mentally scarred to leave home had posted photographs of themselves fishing, riding motorcycles, driving water scooters, flying helicopters and playing basketball.

“The brazenness is shocking,” Cyrus R. Vance Jr., the Manhattan district attorney, said on Tuesday.

While those fraudsters were being indicted, arrested and arraigned, these fraudster were planning their next rip off of their investors.

JPMorgan Is Penalized $2 Billion Over Madoff

By Ben Protess and Jessica Silver-Greenberg

Preet Bharara, the United States attorney in Manhattan, and Jamie Dimon, the chief executive of JPMorgan Chase, gathered in Lower Manhattan as Mr. Bharara’s prosecutors were considering criminal charges against Mr. Dimon’s bank for turning a blind eye to the Ponzi scheme run by Bernard L. Madoff. Mr. Dimon and his lawyers outlined the bank’s defense in the hopes of securing a lesser civil case, according to people briefed on the meeting. [..]

Within weeks of meeting Mr. Bharara and recognizing their limited bargaining power, JPMorgan’s lawyers accepted the $1.7 billion penalty, the people briefed on the meeting said, which was within the range that prosecutors initially proposed. The bank also agreed to pay $350 million to the Office of the Comptroller of the Currency, accepting the agency’s only offer, one of the people said.

It could have been worse for the bank. At one point, prosecutors were weighing whether to demand that the bank plead guilty to a criminal charge, a move that senior executives feared could have devastating ripple effects. Rather than extracting a guilty plea, prosecutors struck a so-called deferred-prosecution agreement, suspending an indictment for two years as long as JPMorgan overhauls its controls against money-laundering. [..]

For JPMorgan, the Madoff case is the bank’s latest steep payout to the government. In November, JPMorgan paid a record $13 billion to the Justice Department and other authorities over its sale of questionable mortgage securities in the lead-up to the financial crisis. All told, after paying these settlements, JPMorgan will have paid out some $20 billion to resolve government investigations over the last 12 months. [..]

And critics of Wall Street are unsatisfied, noting that Mr. Bharara’s office opted to defer prosecution and did not charge any JPMorgan employees with wrongdoing.

“Banks do not commit crimes; bankers do,” said Dennis M. Kelleher, the head of Better Markets, an advocacy group.

A United States District Judge for the Southern District of New York, Jed Rakoff, wants to know why have no high-level executives been prosecuted for the financial crisis

Five years have passed since the onset of what is sometimes called the Great Recession. While the economy has slowly improved, there are still millions of Americans leading lives of quiet desperation: without jobs, without resources, without hope.

Who was to blame? Was it simply a result of negligence, of the kind of inordinate risk-taking commonly called a “bubble,” of an imprudent but innocent failure to maintain adequate reserves for a rainy day? Or was it the result, at least in part, of fraudulent practices, of dubious mortgages portrayed as sound risks and packaged into ever more esoteric financial instruments, the fundamental weaknesses of which were intentionally obscured?

If it was the former – if the recession was due, at worst, to a lack of caution – then the criminal law has no role to play in the aftermath. [..]

But if, by contrast, the Great Recession was in material part the product of intentional fraud, the failure to prosecute those responsible must be judged one of the more egregious failures of the criminal justice system in many years. [..]

In striking contrast with these past prosecutions, not a single high-level executive has been successfully prosecuted in connection with the recent financial crisis, and given the fact that most of the relevant criminal provisions are governed by a five-year statute of limitations, it appears likely that none will be. It may not be too soon, therefore, to ask why. [..]

But the stated opinion of those government entities asked to examine the financial crisis overall is not that no fraud was committed. Quite the contrary. For example, the Financial Crisis Inquiry Commission, in its final report, uses variants of the word “fraud” no fewer than 157 times in describing what led to the crisis, concluding that there was a “systemic breakdown,” not just in accountability, but also in ethical behavior. [..]

Without giving further examples, the point is that, in the aftermath of the financial crisis, the prevailing view of many government officials (as well as others) was that the crisis was in material respects the product of intentional fraud. In a nutshell, the fraud, they argued, was a simple one. Subprime mortgages, i.e., mortgages of dubious creditworthiness, increasingly provided the chief collateral for highly leveraged securities that were marketed as AAA, i.e., securities of very low risk. How could this transformation of a sow’s ear into a silk purse be accomplished unless someone dissembled along the way? [..]

Thus, Attorney General Eric Holder himself told Congress:

   It does become difficult for us to prosecute them when we are hit with indications that if you do prosecute-if you do bring a criminal charge-it will have a negative impact on the national economy, perhaps even the world economy.

To a federal judge, who takes an oath to apply the law equally to rich and to poor, this excuse-sometimes labeled the “too big to jail” excuse-is disturbing, frankly, in what it says about the department’s apparent disregard for equality under the law.

Mar 12 2013

Why Wasn’t the Death Penalty Warranted?

Once again Sen. Elizabeth Warren demonstrated why the voters of Massachusetts sent her to the Senate when in a Senate Banking Committee hearing about money laundering, she questioned why British bank HSBC is still doing business in the U.S., with no criminal charges filed against it, despite confessing to what one regulator called “egregious” money laundering violations

Her comments came just a day after the attorney general of the United States confessed that some banks are so big and important that they are essentially above the law. His Justice Department’s failure to bring any criminal charges against HSBC or its employees is Exhibit A of that problem.

(..) Warren grilled officials from the Treasury Department, Federal Reserve and Office of the Comptroller of the Currency about why HSBC, which recently paid $1.9 billion to settle money laundering charges, wasn’t criminally prosecuted and shut down in the U.S. Nor were any individuals from HSBC charged with any crimes, despite the bank confessing to laundering billions of dollars for Mexican drug cartels and rogue regimes like Iran and Libya over several years.

Defenders of the Justice Department say that a criminal conviction could have been a death penalty for the bank, causing widespread damage to the economy. Warren wanted to know why the death penalty wasn’t warranted in this case.

“They did it over and over and over again across a period of years. And they were caught doing it, warned not to do it and kept right on doing it, and evidently making profits doing it,”

“How many billions of dollars do you have to launder for drug lords and how many economic sanctions do you have to violate before someone will consider shutting down a financial institution like this?”

“You sit in Treasury and you try to enforce these laws, and I’ve read all of your testimony and you tell me how vigorously you want to enforce these laws, but you have no opinion on when it is that a bank should be shut down for money laundering?”

“If you’re caught with an ounce of cocaine, the chances are good you’re gonna go to jail. If it happens repeatedly, you may go to jail for the rest of your life,” Warren said. “But evidently if you launder nearly a billion dollars for drug cartels and violate our international sanctions, your company pays a fine and you go home and sleep in your bed at night — every single individual associated with this. And I think that’s fundamentally wrong.”

As staunch an opponent of the death penalty as I am, I would have voted for it and watched the “execution” of HSBC with glee.

Feb 20 2013

Another Bailout Since Dodd Frank Debunks the Lies

Yes, unlike what was sold to us about Dodd Frank, there are in effect already backdoor bailouts before our very eyes if we care to look. This one involves the most important regulator of our entire financial system, the New York Fed, intervening to let Bank of America off the hook for its residential mortgage backed securities fraud.  

Feb 19 2013

Still Bailing Out the Banks

Nearly a year ago Rolling Stone contributing editor, Matt Taibbi wrote about how the Bank of America had defrauded everyone yet the US government kept bailing it out. They got a slap on the wrist and a paltry $$137 million fine for bilking needy schools and cities all the while plotting to rig global interest rates. In that same article from March 29th, 2012, Matt noted that BoA was still failing, yet they were still being bailed out. Why? The government’s excuse then and still is that they are too big to fail and too big too jail.

This was not fixed by Dodd-Frank and the promise to investigate the mortgage fraud and hold the banks accountable for bringing down the housing market and the economy along with it never materialize.

On Saturday in her New York Times article Gretchen Morgenson revealed that, we, the American taxpayer, are still bailing out Bank of America in secret deals :

That the New York Fed would shower favors on a big financial institution may not surprise. It has long shielded large banks from assertive regulation and increased capital requirements.

Still, last week’s details of the undisclosed settlement between the New York Fed and Bank of America are remarkable. Not only do the filings show the New York Fed helping to thwart another institution’s fraud case against the bank, they also reveal that the New York Fed agreed to give away what may be billions of dollars in potential legal claims.

Here’s the skinny: Late last Wednesday, the New York Fed said in a court filing that in July it had released Bank of America from all legal claims arising from losses in some mortgage-backed securities the Fed received when the government bailed out the American International Group in 2008. One surprise in the filing, which was part of a case brought by A.I.G., was that the New York Fed let Bank of America off the hook even as A.I.G. was seeking to recover $7 billion in losses on those very mortgage securities.

It gets better.

What did the New York Fed get from Bank of America in this settlement? Some $43 million, it seems, from a small dispute the New York Fed had with the bank on two of the mortgage securities. At the same time, and for no compensation, it released Bank of America from all other legal claims.

[…] To anyone interested in holding banks accountable for mortgage improprieties, the Fed’s actions are bewildering. If the Fed intended that Maiden Lane II own the right to sue Bank of America for fraud, why didn’t it pursue such a potentially rich claim on behalf of taxpayers? The Fed made $2.8 billion on the Maiden Lane II deal, but the recovery from Bank of America could have been much greater. Why did it instead release Bank of America from these liabilities and supply declarations that seem to support the bank in its case against A.I.G.?

The New York Fed would not discuss this matter, citing the litigation. But taxpayers, who might have benefited had the New York Fed brought fraud claims, deserve answers to these questions.

[…] A New York Fed spokesman said it supported the settlement because it would generate significant value without potentially high litigation costs.

Let’s recap: For zero compensation, the New York Fed released Bank of America from what may be sizable legal claims, knowing that A.I.G. was trying to recover on those claims.

If they’re too big to fail, to big to jail then these banks should be too big to exist.

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