Warning: Get Your Money Out: “All Legal Bank Deposit Protections Are Now Officially Gone”

Warning: Get Your Money Out: “All Legal Bank Deposit Protections Are Now Officially Gone”

The warning, stemming from a recent federal appeals court ruling surrounding customer funds lost during the 2007 collapse of Chicago futures broker Sentinel, indicates that individuals who lose deposited funds because a financial institution improperly manages that money, even if those funds are supposed to be “segregated” from other operations of the firm, are essentially left with no recourse if the firm goes belly-up. According to the court, a misallocation of those customer funds, “is not, on its own, sufficient to rule as a matter of law that Sentinel acted ‘with actual intent to hinder, delay, or defraud’ its customers.”

www.shtfplan.com... ldman-sachs-megabanks_08122012

(Reuters) - A ruling in the case of failed futures brokerage Sentinel Management Group could make it more difficult for customers to recoup money lost in the much larger collapse of MF Global, according to Sentinel's bankruptcy trustee.

www.reuters.com...

did a search but didn't see anything on this.

seems the court has decided our money doesn't mean anything when stolen in bulk.

i'm not liking this at all. it's one thing when you hear rumors and fear mongering but when the court says it's okay for the bankers to steal our money i begin to get an eerie feeling about this whole financial fiasco.

what opinions does ATS have on such a legal precedence being set?

reply to post by LittleBlackEagle


hi LittleBlackEagle, thanks for that...

do U really want my opinion???

it sux, sorry...SUX....big time...

this is a bad precedent,

electronic money always has a potential to disappear,
not to mention the fact that corporations just need to change name and they are no longer the previous entity, no baggage, nothing...just a fresh start to do it again...try doing that yourself and see what happens...

corporations = individuals...NO!!!


seeya and thanks again

They are not at fault for spending your money.
Now that`s pathetic and so wrong. Just proves without doubt the court system needs fixed above everything else Can`t look to the courts for defending our rights and this surely should prove it`s very flawed and corrupt not looking out for the citizens but also another defender of corrupt businesses.

Originally posted by Connman
They are not at fault for spending your money.

Now that`s pathetic and so wrong. Just proves without doubt the court system needs fixed above everything else Can`t look to the courts for defending our rights and this surely should prove it`s very flawed and corrupt not looking out for the citizens but also another defender of corrupt businesses.

it demonstrates the analogy that there are very well separate laws for separate classes of US citizens.

i'm just getting an itch that this could very well be on purpose to start the crash rolling along. if this story gets to a large part of the population it could trigger a bank run here in the US as before unseen.

Okay, I am confused here. I understand this concept, I suppose, but doesn't that mean that FDIC insurance for bank accounts of up to 100,000 dollars would kick in?

It's a crappy verdict, because these funded were being used for the wrong purpose.

But, investing your money in stocks, bonds, commodities, futures never had the same protections as opening a savings account or share draft account.....these investments are buyer beware.
Not really surprising, either, that the banksters get first crack at recouping their money...rightly or wrongly.

reply to post by LittleBlackEagle


I agree with your bank run theory, but...
When the scales are this much out of balance you can rest assured this message will not get out to the gen pop.

The money will be adequate to insure that this remains under wraps.

It was probably assured and secured before any questionable act even occurred. The bases are always covered even before the game begins. All we can do is watch it play out from the sidelines.

Originally posted by AnIntellectualRedneck
Okay, I am confused here. I understand this concept, I suppose, but doesn't that mean that FDIC insurance for bank accounts of up to 100,000 dollars would kick in?

FDIC-Insured

Checking Accounts (including money market deposit accounts)


Savings Accounts (including passbook accounts)


Certificates of Deposit

Not FDIC-Insured

Investments in mutual funds (stock, bond or money market mutual funds), whether purchased from a bank, brokerage or dealer


Annuities (underwritten by insurance companies, but sold at some banks)


Stocks, bonds, Treasury securities or other investment products, whether purchased through a bank or a broker/dealer

www.fdic.gov...

evidently they are not covered by the FDIC

This was not a company covered by the FDIC, it was an investment account with a brokerage, they are never covered by the FDIC. The current FDIC limit on an account is $250,0000. This article has nothing to do with banks or credit unions, only investment brokerages.

Originally posted by DontTreadOnMe
It's a crappy verdict, because these funded were being used for the wrong purpose.

But, investing your money in stocks, bonds, commodities, futures never had the same protections as opening a savings account or share draft account.....these investments are buyer beware.
Not really surprising, either, that the banksters get first crack at recouping their money...rightly or wrongly.

no it's not surprising at all and i think it's leading up to something more but only time will tell if it pans out like that or not.

P.S. thanks for moving this to the proper forum, i was tossed up between civil-unrest and global meltdown.

Originally posted by Wetpaint72
reply to post by LittleBlackEagle

 

I agree with your bank run theory, but...
When the scales are this much out of balance you can rest assured this message will not get out to the gen pop.

The money will be adequate to insure that this remains under wraps.

It was probably assured and secured before any questionable act even occurred. The bases are always covered even before the game begins. All we can do is watch it play out from the sidelines.

normally i would agree that it would be adequately buried but this is huge and will reach deep into investment banking and brokerages.

reply to post by AnIntellectualRedneck


FDIC coverage is for depositry accounts at banks, crdit unions etc.. The company that went bankrupt was a brokerage house that handles investmnets. Only bank accounts are backed by the FDIC, not brokerage accounts.

something i didn't realize and seemingly a story within a story that these institutions are allowed to offshore private client data along with robbing citizens.

oligarchy at it's finest i suppose. this really just adds icing to the proverbial cake, of wrong doing we are witnessing with our judicial/political systems.

Offshoring Risks
Domestic outsourcing and offshoring share most risk characteristics. However, the more complicated chain of control incurred when offshoring financial services and related data may create new risks when compared to domestic outsourcing. Offshoring also introduces an element of country risk to the outsourcing process. In particular, geographic distance from the function and timing lags in reporting heighten the potential risk exposures. Significant offshoring risk areas include:

Country Risk: political, socio-economic, or other factors may amplify any of the traditional outsourcing risks, including those listed below.
Operations/Transaction Risk: weak controls may affect customer privacy.
Compliance Risk: offshore vendors may not have adequate privacy regulations.
Strategic Risk: different country laws may not protect "trade secrets."
Credit Risk: a vendor may not be able to fulfill its contract due to financial losses.

www.fdic.gov...

reply to post by shaneR

that and it seems they are free to offshore their new digs as well, it's kind of like super organized crime for the new millenia.

The blog/post badly interprets the court decision. Brokerage houses were never covered by the FDIC.

So the headline 'Warning: Get Your Money Out: “All Legal Bank Deposit Protections Are Now Officially Gone”' - isn't true. The FDIC is still there for all bank deposits.

On the flip side, when the GOP repealed the Glass-Steagall Act with the Gramm-Leach-Bliley Act in 1999, it paved the way for allowing banks, brokerages, and insurance companies to merge. Some commercial banks that accept savings deposits then funnel that money into brokerages to gamble with played a huge role in the financial sector collapse of 2007-2008. BUT that still doesn't excuse the incorrect headline in this post.

reply to post by Blackmarketeer


i also questioned the headline but this is the shock and awe 2ks and many journalists get quite sensational with their headlines. most people today won't see less flashy headlines i suppose.

reply to post by LittleBlackEagle


The Reuters headline seemed okay, it's the SHTFplan.com headline that is wrong. Technically the FDIC is still covering commercial bank deposits. Of course, the repeal of the Glass-Steagall Act does put commercial bank deposits at risk, since it lets banks merge with brokerages and insurance companies. The FDIC managed to cover accounts during the first financial collapse, I don't think they will be able to the next go around, and lacking any financial reform (Dodd-Frank has all it's teeth pulled, courtesy of Republicans in Congress), there will certainly be another financial collapse.

Originally posted by Blackmarketeer
reply to post by LittleBlackEagle

 

The Reuters headline seemed okay, it's the SHTFplan.com headline that is wrong. Technically the FDIC is still covering commercial bank deposits. Of course, the repeal of the Glass-Steagall Act does put commercial bank deposits at risk, since it lets banks merge with brokerages and insurance companies. The FDIC managed to cover accounts during the first financial collapse, I don't think they will be able to the next go around, and lacking any financial reform (Dodd-Frank has all it's teeth pulled, courtesy of Republicans in Congress), there will certainly be another financial collapse.

exactly and i guess if we subscribe to the new regulations or lack of an old one's, then really the headline is not so far stretched. there will be another collapse because it's scientifically the only way it can go. just wondering if this is not done on purpose to get things moving along and incite i bank run.

i think we will see complete and utter, in your face, lack of doing anything by or judicial and political system. people tend to do okay until their resources have been taken away in sufficient quantities to make them do what they have to do in order to survive.

Banks are like no other institution, think about it: give me your money (first an account fee)
Every time you make a ATM transaction, (there's a fee) if you want all your money (there's a fee)

If we miss manage your money, or we fail at our job, your burnt!

People need to manage their OWN money and not let some foreign banksters handle your money.

Imagine if drug dealers operated that way. Give me your drugs, when you want them, I take some, if I get arrested, your burnt.

If that was the way dealers operated, drug use would plummet.

Why should it be different for money?

reply to post by thepupils


people do need to manage their own money and would be wise to get it out of any investment bank or institution.

i pulled everything out of those types of institutions long ago.