Tim Geithner, Fed Knew of Lloyd's LIBOR Scam. Implicates the 16 LIBOR Banks, BofA, CITI

Originally posted by tothetenthpower
Unless the board members, CEO's and major shareholders of these banks go to jail, then it's all meaningless.
Justice is not only uncovering the truth, but holding those who caused the problem accountable.
We seem to do a great job at the first thing, not so much on the 2nd.
`tenth

There is a rule of law that allows a single shareholder to bring suit on behalf of all shareholders for the wrongdoing of a corporation.

"Shareholder derivative suits" may be the best remedy for these things.

When the officers of BofA, for example, are rewarded with extravagant pay and bonuses, even when their actions caused the company's market value to fall by billions, thereby injuring the shareholders, a lawsuit could "claw back" that compensation for the shareholders. Officers and Directors also carry "E&O" (Errors and Omissions) insurance with huge limits and umbrella coverage into the hyndreds of millions.

All it takes is an enterprising attorney to seek out the "victims." Ever see those "You may be entitled to dameges" commercials? Same mechanism.

Good luck to everyone whose 401k is iinvested in some of these companies; they could make the difference in accountability..

Originally posted by fnpmitchreturns
Here is a great interview with Greg Hunter and Max Keiser. Hunter points out during the interview that JP Morgan is leveraged 2000 to 1 in interest rate swaps... this why they kept he rates so low!

Great point! it's time "investment bankers" were separated from retail bankers again. Let them gamble with their own money, not shareholders' and depositors'.

Another article that came out, this time from the New York Times:

New York Fed Knew of False Barclays Reports on Rates
dealbook.nytimes.com...

The Federal Reserve Bank of New York learned in April 2008, as the financial crisis was brewing, that at least one bank was reporting false interest rates.

At the time, a Barclays employee told a New York Fed official that “we know that we’re not posting um, an honest” rate, according to documents released by the regulator on Friday. The employee indicated that other big banks made similarly bogus reports, saying that the British institution wanted to “fit in with the rest of the crowd.”

Although the New York Fed conferred with Britain and American regulators about the problems and recommended reforms, it failed to stop the illegal activity, which persisted through 2009.

“As much as $800 trillion in financial products are pegged to Libor, so any manipulation of this rate is of serious concern,” said Representative Randy Neugebauer, the chairman of the House Financial Services Subcommittee on Oversight and Investigations, which initially requested the documents from the New York Fed. “We’ll continue looking into this matter to determine who was involved in this practice and whether it could have been prevented by regulators.”

Heres some damn food for thought!


The same 18 banks were recently downgraded a month ago. So we are learning this now? When they obviously knew way back, and way before the downgrade last month?

INSANE!!!!!!!!

reply to post by misfitofscience

Funny thing, that.
And still no word from the one man in the US who could've done something about it in 2007 or 2008 or 2009 or 2010 or 2011 or 2012!

When is Tim Geithner going to explain the Fed and Treasuy's complicity in this fraud?

Better yet, when is his boss, Barack Obama going to make a statement instead of making false claims about Mitt Romney?

People, just face the facts. Yes, everyone who was supposed to guard against these types of things knew exactly what was going on and did nothing to stop it.

These people are in positions of power, and nothing is going to be done to prevent things like this from happening again and again....and nothing is going to happen to these individuals. Well, perhaps some harsh words on C-SPAN and some finger pointing. Until the people get off their asses and physically punt these assholes out onto the street you can expect the same thing until everything falls apart.

Originally posted by MidnightTide
People, just face the facts. Yes, everyone who was supposed to guard against these types of things knew exactly what was going on and did nothing to stop it.

These people are in positions of power, and nothing is going to be done to prevent things like this from happening again and again....and nothing is going to happen to these individuals. Well, perhaps some harsh words on C-SPAN and some finger pointing. Until the people get off their asses and physically punt these assholes out onto the street you can expect the same thing until everything falls apart.

Bloomberg Business ran a editorial today that basically just said, "Can't we all just get along."
They advocated slaps on wrists and moving forward, but didn't say to what.
www.bloomberg.com...
What assholes!

Originally posted by jdub297
reply to post by misfitofscience

 

Funny thing, that.
And still no word from the one man in the US who could've done something about it in 2007 or 2008 or 2009 or 2010 or 2011 or 2012!

When is Tim Geithner going to explain the Fed and Treasuy's complicity in this fraud?

Better yet, when is his boss, Barack Obama going to make a statement instead of making false claims about Mitt Romney?

In politics timing is everything. Got a nasty fire on your hands? Quick start another one somewhere else to dilute attention... Yes it all makes sense.

Originally posted by jdub297

Originally posted by MidnightTide
People, just face the facts. Yes, everyone who was supposed to guard against these types of things knew exactly what was going on and did nothing to stop it.

These people are in positions of power, and nothing is going to be done to prevent things like this from happening again and again....and nothing is going to happen to these individuals. Well, perhaps some harsh words on C-SPAN and some finger pointing. Until the people get off their asses and physically punt these assholes out onto the street you can expect the same thing until everything falls apart.

Bloomberg Business ran a editorial today that basically just said, "Can't we all just get along."
They advocated slaps on wrists and moving forward, but didn't say to what.
www.bloomberg.com...
What assholes!

How can we move on from that. Corruption at the very core of the system we all live in. How do those banks plan on repaying everyone they have cheated......and anyone who has a loan or had a loan has been cheated.

When can I expect a check in the mail?

It pisses me off when I know nothing will be done about this, but what can one man do.

I guess I don't see what the big deal is. The Fed calling out the LIBOR banks seems like a power grab by Geithner. Think about it. The Fed officers meet every quarter to decide on what the Prime Rate in the United States should be. They set the Prime Rate, and the Prime Rate governs the pricing for retail consumer mortgages, commercial loans for businesses, etc. here in the United States.

It's almost as if Geithner is calling corruption charges on the LIBOR group, even though the Fed does the exact same thing. Heck, the Fed jacked up interest rates back during the speculative real estate bubble here in the United States in an attempt to cool down the economy.

It cooled the economy all right, sending thousands of home builders and other borrowers into bankruptcy when the Prime rate got too high too fast.

Hiking up the Prime rate or bringing down the Prime rates effects the entire banking system in the United States.

By keeping the rate artifically low, banks make it appear that they have better credit than they did in reality.

Does it really matter what rate the banks want to set to borrow amongst themselves? I don't see how this hurts the average Joe Consumer.

When the Fed sets the Prime Rate here in the U.S., this can definitely hurt the consumer. If you have a Home Equity Line of Credit tied to the Prime Rate for example, then every time the Fed jacks up the rate your interest rate and payment increases. By contrast, every time the LIBOR rate fluctuates, no one really cares except for big Fortune 500 companies that do borrow on LIBOR rates.

Few consumers borrow on LIBOR. It's more common among large corporations and High Net Worth individuals.

And, what if the banks were doing everyone a service by artificially keeping LIBOR rates so low so that they didn't tank the economy even further? If they jacked up LIBOR, a lot of corporations that borrow on LIBOR rates could have been rendered insolvent.

When will these money whores start to face real jail time?

You need to pay much, much closer attention to the news. Bankers are being prosecuted for their crimes left and right. A few examples:

www.myfoxspokane.com...

and
www.bloomberg.com...

and
www.bizjournals.com...

and
in.reuters.com...

This was during the Bush administration and I am not Republican, I am independent but republican leaning with many reservations.


washingtonpost.com
Predatory Lenders' Partner in Crime

By Eliot Spitzer
Thursday, February 14, 2008

Several years ago, state attorneys general and others involved in consumer protection began to notice a marked increase in a range of predatory lending practices by mortgage lenders. Some were misrepresenting the terms of loans, making loans without regard to consumers' ability to repay, making loans with deceptive "teaser" rates that later ballooned astronomically, packing loans with undisclosed charges and fees, or even paying illegal kickbacks. These and other practices, we noticed, were having a devastating effect on home buyers. In addition, the widespread nature of these practices, if left unchecked, threatened our financial markets. Even though predatory lending was becoming a national problem, the Bush administration looked the other way and did nothing to protect American homeowners. In fact, the government chose instead to align itself with the banks that were victimizing consumers. ...paragraph removed by myself...go to article What did the Bush administration do in response? Did it reverse course and decide to take action to halt this burgeoning scourge? As Americans are now painfully aware, with hundreds of thousands of homeowners facing foreclosure and our markets reeling, the answer is a resounding no. ... Let me explain: The administration accomplished this feat through an obscure federal agency called the Office of the Comptroller of the Currency (OCC). The OCC has been in existence since the Civil War. Its mission is to ensure the fiscal soundness of national banks. For 140 years, the OCC examined the books of national banks to make sure they were balanced, an important but uncontroversial function. But a few years ago, for the first time in its history, the OCC was used as a tool against consumers.

washington post article

One month later we have this

Gov. Eliot Spitzer, whose rise to political power as a fierce enforcer of ethics in public life was undone by revelations of his own involvement with prostitutes, resigned on Wednesday, becoming the first New York governor to leave office amid scandal in nearly a century

New York Times


So this was known and allowed to happen and Spitzer was punished for letting the cat out of the bag. And who did they replace him with, a gov and his wife who both admitted adultery from the git go.

If you are not squeaky clean from the beginning, ever made a mistake in you life, it will be used against you regardless of your ethics (sp). We are and have been for decades in deep trouble.

reply to post by CookieMonster09

You're just a little bit confused about what has been happening and the implications of the LIBOR schemes.
LIBOR plays a bigger part in the economy than you're aware of. Both Forbes and the Wall Street Journal have estimated that the total of financial transaction affected will be about $800 [n]Trillion.
Considering that our total GDP is about $14Trillion, the actual losses could deeply affect every developed coountry far more than the housing and credit bubbles did.

Originally posted by CookieMonster09
I guess I don't see what the big deal is. The Fed calling out the LIBOR banks seems like a power grab by Geithner.

The problem here is that the Fed did not "call out" the banks.
Fed President Geithner knew in 2007 of the scemes and did nothing.
In 2008, he sent the Bank of England a list of 6 "suggestions" for the 16 Libor banks,but never followed up, and knew that US banks BofA, JPMorgan, and CITI were still involved, but did nothing as their official "regulator."
In 2009 he became the Secretary of Treasury and still did nothing. Same for 2010, 2011 and 2012.

Barclays got "called out" as a result of European investigations into fixing the EU version: EURIBOR..
Fed Pres./Sec. Treasury Geithner's acquiescence and complicity were exposed by Congressional disclosures of documents leaked by Barclay's and Lloyds whistleblowers.

Think about it. The Fed officers meet every quarter to decide on what the Prime Rate in the United States should be. They set the Prime Rate, and the Prime Rate governs the pricing for retail consumer mortgages, commercial loans for businesses, etc. here in the United States.

Prime is used for the best loans; LIBOR is used for A and sub-prime and adjustable mortgages. It is used for less-than-perfect credit loans and credit cards of all kinds; the vast majority.

It is also used for hundreds of Trillions of dollars of rate swaps and CDOs that the "investment" arms of traditional banks have been using to enhace their earnings, or to lose billions, much like Jamie Dimon's JPMorgan did to the tune of $5billion losses.

It's almost as if Geithner is calling corruption charges on the LIBOR group, even though the Fed does the exact same thing. Heck, the Fed jacked up interest rates back during the speculative real estate bubble here in the United States in an attempt to cool down the economy.

The Fed IS doing the same thing! That's one reason that Geithner looked the other way; the Fed was trying to push US rates lower to keep borrowing costs low in the US when banks were teetering in 2007/08.
Geithner is deeply involved in the international frauds that will cost world-wide investors and borrowers trillions of dollars when this is all totalled up.

Does it really matter what rate the banks want to set to borrow amongst themselves? I don't see how this hurts the average Joe Consumer.

Yes, if a bank is not doing well, its cost of credit will be higher than if was doing well, Investors relied upon the LIBOR rates, among other things, to gauge whether a bank is worth investing in or trusting with their money.
2 years ago, investors were paying $59/share for BofA nased on such assessments. Today it trades at about $7/share. Have the investors been hurt? Were they misled and cheated?
Multiply times millions of investors worldwide.

By contrast, every time the LIBOR rate fluctuates, no one really cares except for big Fortune 500 companies that do borrow on LIBOR rates.Few consumers borrow on LIBOR.

Almost every adjustable rate mortgage is based on Libor, and these were bundled and sold to millions of pension funds, cities and individual as good investments. They are damaged goods, now that may never be sold again or paid off.

what if the banks were doing everyone a service by artificially keeping LIBOR rates so low so that they didn't tank the economy even further?

Crippled or troubled banks could've been taken one-by -one starting in 2007 and maybe avoiding the meltdown that came when credit evetually dried up. Didn't you ever wonder why banks that were able to borrow to meet obligations in 2007 couldn't 7 months later? The "insiders" knew the game was too far along and unsustainable.

You need to pay much, much closer attention to the news. Bankers are being prosecuted for their crimes left and right. A few examples

You first "example" was a phony commodity futures broker, the others were small fry.

We need to take down the guys with the $50milliom paychecls to stop this.

reply to post by jdub297

US builds criminal cases in interest rate-fixing scandal

The NY Times is reporting that criminal tagets have been identitied and charges may be filed later this year!

As regulators ramp up their global investigation into the manipulation of interest rates, the Justice Department has identified potential criminal wrongdoing by big banks and individuals at the center of the scandal.

The department’s criminal division is building cases against several financial institutions and their employees, including traders at Barclays, the British bank, according to government officials close to the case who spoke on the condition of anonymity because the investigation is continuing. The authorities expect to file charges against at least one bank later this year, one of the officials said.

The prospect of criminal cases is expected to rattle the banking world and provide a new impetus for financial institutions to settle with the authorities. The Justice Department investigation comes on top of private investor lawsuits and a sweeping regulatory inquiry led by the Commodity Futures Trading Commission. Collectively, the civil and criminal actions could cost the banking industry tens of billions of dollars.

Authorities around the globe are examining whether financial firms manipulated interest rates before and after the financial crisis to improve their profits and deflect scrutiny about their health. Investigators in Washington and London sent a warning shot to the industry last month, striking a $450 million settlement with Barclays in a rate-rigging case. The deal does not shield Barclays employees from criminal prosecution.[/exnres]
www.msnbc.msn.com...

The investigation involves multiple agencies in the US and EU and England. It may result in much more difficulty for the banks and their officers.
It could be years before all is wrapped up, and no one can say yet the total damage to financial systems worldwide.
jw

WAIT this is a TARP, I mean TRAP....




Ok, if this was so much of a secret as if the non sheep haven't known about this already (Duh)....How did this make NEWS? If something of this magnitude makes NEWS, it was for a reason.....Keep guiding the sheep...

Originally posted by KonquestAbySS

Ok, if this was so much of a secret as if the non sheep haven't known about this already (Duh)....How did this make NEWS? If something of this magnitude makes NEWS, it was for a reason.....Keep guiding the sheep...

:lol

Sheep?
Sorry, but this was not common knowledge among the general public until the Barclays story broke last week.


How long have you known that the 16 LIBOR-setting banks were fixing the rate?
How did you find out?,

You might want to let the CFTC and SEC know, since they are still working on their investigations.

Good work, sleuth.

If they did not prosecute anyone from the 2008 financial crisis that brought the world's markets down why would they do it for this?

All the big banks are "zombie" banks. They've been insolvent since 2008 having borrowed trillions from the FEDs.

Just another day in the finance industry that still claims they can self police themselves...and can still resist all calls for reform.

Considering that our total GDP is about $14Trillion, the actual losses could deeply affect every developed coountry far more than the housing and credit bubbles did.

You're not making sense. What losses? By keeping the rates low, banks stayed solvent, and corporate borrowing rates were kept low. Individuals - such as High Net Worth individuals and individuals in Interest Only LIBOR-based loans -- all benefited from a lower LIBOR rate.

Again, how is this any different from the Fed setting the Prime Rate every quarter? It's no different.

The problem here is that the Fed did not "call out" the banks.

Geithner's "suggestions" were a power grab.

LIBOR is used for A and sub-prime and adjustable mortgages. It is used for less-than-perfect credit loans and credit cards of all kinds;

It is also used for Fortune 500 companies that borrow, as well as High Net Worth individuals that borrow.

Have you noticed that we are in a major global recession? Why would we want to jack up LIBOR rates right now and send the global economy into an even bigger tailspin?

Ultimately, someone or some entity has to set LIBOR rates. You can call this "artificially" setting the LIBOR rates, but computers don't run the economy, people do. And I would rather have the banks decide than some political entity that will manipulate the LIBOR rates for political reasons. At least banks have a vested interest in the LIBOR rate setting.

Did you ever stop to think that by keeping LIBOR low the decision-making banks were actually doing the economy a huge favor?

What happens when rates get jacked up higher? People in Interest-Only mortgages cannot make their payments, resulting in foreclosure. Corporations cannot borrow, or possibly default on their loan obligations.

So, why on earth would you advocate jacking up LIBOR rates?

Geithner is deeply involved in the international frauds

Before you go pointing fingers a high profile figure in our government accusing them of fraud, you better have some concrete evidence to back your claim. Geithner has no control over Barclays.

They are damaged goods, now that may never be sold again or paid off.

They are damaged goods because the loans weren't underwritten properly, and because up to 70% of borrowers lied on their loan applications, not to mention the rampant mortgage fraud committed by loan brokers and borrowers according to the FBI's own reports and statistics.

All of which have nothing to do with LIBOR rates. Again, why do you want to jack up LIBOR rates even higher?

You first "example" was a phony commodity futures broker, the others were small fry.

Nonsense. I listed several examples of bankers that were prosecuted for financial crimes. Colonial Bank was the 6th largest bank failure in U.S. history. The prosecution of Farkas and his cohorts was hardly small fry. After all, Farkas bilked over $3 Billion from Colonial Bank. Not a small amount.

The point is that prosecutions of bankers engaged in fraud are happening all the time, especially recently. The post I was responding to was saying that bankers were not being prosecuted. That statement was patently false.

If you have evidence to prosecute "bigger" banks or bankers, then by all means go ahead and provide your proof. Blanket accusations are not proof.

The NY Times is reporting that criminal tagets have been identitied and charges may be filed later this year!

Just in time to issue a one world currency, and a one world bank with a micro-chipped population.

There is a reason why this alleged "scandal" is happening. This is a huge power grab, folks. Wake up.

reply to post by jdub297


Why wouldn't the FEDERAL RESERVE be involved ?
Americans got stupid in 1913 by allowing Congress to pass the Federal Reserve Act of 1911-1913
and giving our monitary system over to a 3rd party to handle.

The Federal Reserve is a CORRUPT institution. The UsA Government needs to REPEAL the Federal Reserve Act and make the FEDERAL RESERVE pay back in GOLD all the money they have obsconded away with from the American People. They also need to do away with the Internal Revenue Service, the collection arm of the Federal Reserve Banking System.

The Federal Reserve is a CORRUPT institution. The UsA Government needs to REPEAL the Federal Reserve Act and make the FEDERAL RESERVE pay back in GOLD all the money they have obsconded away with from the American People. They also need to do away with the Internal Revenue Service, the collection arm of the Federal Reserve Banking System.

I hear this all the time, especially from the Ron Paul crowd. The truth is, the country's banking system has to be run by someone. I find it highly doubtful that our politicians could run a national banking system any better than the Federal Reserve. I also find it laughable that the politicians could find a better tax collecting arm than the IRS.

We are dealing with fallible human beings in either case. Whether its the Federal Reserve Board running monetary policy, or politicians, I doubt that the politicians would fare better. At least the Federal Reserve Board consists of people that have been in the banking industry for many decades. And, for all of the hoopla about our Fed Chairman, his academic credentials in the area of economics and banking are unparalleled. You would be had pressed to find a more knowledgeable and intelligent candidate for Fed Chairman among the political class.

I'd rather have a banker or an economist running monetary policy, than a politician that will make monetary policy based primarily on political rationale, populist causes, bribes, kick-backs, and the like. Monetary policy shouldn't be politicized.

That is truly one of the main benefits of the Federal Reserve is its relative insulation from politicization from our wretched, corrupt political class.

reply to post by CookieMonster09


It has to be run by someone who is representative of the people, who elected those in the FED? You talk about why should we all be worried about manipulation of the LIBOR rate.....why should we be worried about low rates? Low rates promote poor financial decisions, low rates allow those banks to make crappy derivative bets then cover them up.

I'd rather have a banker or an economist running monetary policy

Yes, they have done so well, haven't they.