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Archive for the ‘frauds’ Category

Just lucky

Posted by Charles II on February 28, 2014

Jia Lynn Yang, WaPo:

Forget hiring a top hedge fund to manage your portfolio. Your better bet might be an employee at the Securities and Exchange Commission, according to a new report suggesting that regulators are trading on inside information relating to investigations and upcoming enforcement actions.

In the report titled “The Stock Picking Skills of SEC Employees,” researchers found that SEC employees’ stock purchases look like your average person’s. But when these employees sell their stocks, they appear to systematically beat the market by making sales within weeks of costly enforcement actions by the agency.

“These results suggest that SEC employees potentially trade profitably under the new rules, and that at least some of their profits potentially stem from trading ahead of costly SEC sanctions and on privileged non-public information,” write Shivaram Rajgopal, a professor of accounting at Emory University, and Roger M. White, a doctoral student in accounting at Georgia State University. “In short, it appears that SEC employees continue to take advantage of non-public information to trade profitably in stocks under their regulatory purview.”

I have to say, all the most successful investors, guys like Warren Buffett, do it this way: trade on inside information. I still can’t believe that Martha Stewart of all people did jail time for what goes on all the time.

Posted in frauds, stock market | 6 Comments »

Financial crisis 2.0

Posted by Charles II on June 13, 2013

Atrios linked a bit by Charles Pierce which linked Mary Williams Walsh in the NYT, with an uncharacteristically easy to understand article (based on a report by Benjamin Lawsky of NY Dept of Financial Services) on how life insurance companies are cooking their books.

Let’s suppose that you took the $100,000 mortgage on your house and sold it to your five-year old son for $1. Now you don’t have any liabilities! So you can buy that flat screen TV you always wanted.

But of course, when the bank comes around looking for their payment, your 5 year old son won’t have anything to give them.

This is what the life insurance companies have done, creating out of state shell companies to buy their liabilities in a phony “re-insurance” scheme. It looks to me to be exactly like the Enron scheme, turning a liability into an asset in an off-the-balance-sheet maneuver. According to Walsh, Lawsky says these deals were backed by “’hollow assets,’ ‘naked parental guarantees’ and ‘conditional letters of credit.’” And if the life insurers are doing this, what are other insurers doing?

These are publicly traded companies, so an investigation into whether or not this is fraud should be mounted. Walsh:

The separate analysis by SNL Financial, by contrast, was based on public regulatory filings. It did identify the life insurance companies that are the biggest users of the transactions, both in and out of New York. They include Transamerica, MetLife, Prudential, Hartford, Genworth, John Hancock, ReliaStar and Lincoln National, among others. Another insurer, Allstate, turned up in the sample even though its primary business is property and casualty, because it owns some life insurers.

Just incredible.

Posted in crimes, financial crisis, frauds, impunity | 2 Comments »

Financial culinary skilling

Posted by Charles II on May 9, 2013


Hard-pressed company bosses across much of the world are under so much pressure to deliver on growth that many have resorted to cooking the books, Ernst & Young said in a survey Tuesday.

One in five of almost 3,500 staff quizzed in 36 countries in Europe, the Middle East, Africa and India said they had seen financial manipulation in their companies in the last 12 months, the accounting and consultancy firm said.

In addition 42 percent of board directors and top managers questioned in the fraud survey said they were aware of “some type of irregular financial reporting.”

Conspicuously missing from the country list: the US. Where Jeffrey Skilling of Enron could have his sentence reduced by 10 years. Because, of course, lightening penalties on white collar criminals deters crime.

Posted in capitalism as cancer, financial crisis, frauds | 4 Comments »

See, Democrats? There’s a need for Voter ID.

Posted by Charles II on October 24, 2012

Michael McAuliff and John Celock, HuffPo:



If Republicans had an acronym for their aggressive voter outreach in North Dakota’s oil fields, it could be ACORN’D: Association of Conservative Oilworkers For a Republican North Dakota.That’s because Republican operatives deployed in the western part of the state where the oil industry is booming are using the same tactics that conservatives have often complained the defunct ACORN used to help Democrats: signing up transient and recent arrivals, such as colleges students, as voters. But in this case, the prospective voters are oil workers.

The main effort is getting people who are drawn to the oil patch from far and wide to sign up as North Dakota residents, which automatically allows them to vote. The state has no voter registration process, and out-of-staters can vote legally in North Dakota as long as they have lived there for at least 30 days.

In the western part of the state, though, the effort has gotten so agressive that it’s now targeting people in bars, temporary housing and even in RV parks and pop-up “skid shack” towns.

Why McAuliff and Celock have to drag ACORN through the mud is not clear. The attempt to subvert North Dakota’s vote is bad enough that it deserves to be considered on its own.

Posted in frauds, Republicans acting badly | 3 Comments »

More Republican Vote Fraud

Posted by Charles II on September 29, 2012

We should believe the Republicans when they say that there’s a problem with vote fraud, since they seem to be the main ones committing it. Brad Friedman, truthout:

The Republican Party of Florida’s top recipient of 2012 expenditures, a firm by the name of Strategic Allied Consulting, was just fired on Tuesday night, after more than 100 apparently fraudulent voter registration forms were discovered to have been turned in by the group to the Palm Beach County, FL Supervisor of Elections.

The firm appears to be another shell company of Nathan Sproul, a longtime, notorious Republican operative, hired year after year by GOP Presidential campaigns, despite being accused of shredding Democratic voter registration forms in a number of states over several past elections.

…The Palm Beach Post is reporting tonight that the firm received “more than $1.3 million” from the Republican Party of Florida “to register new voters.”

Moreover, the firm is also reportedly operating similar voter registration operations on behalf of the Republican Party, to the tune of hundreds of thousands of dollars, in a number of key battleground states this year, including North Carolina, Virginia and Colorado.

…a massive GOP voter registration scheme, which appears to involve the upper-echelons of the national party, begins to emerge…

We’ve reported on Sproul many times over the years, as the GOP operative, and former chair of the Arizona GOP and the state’s Christian Coalition, pops up again and again in each Presidential Election year. He is hired over and over by the Republican Party, despite years of fraud allegations in multiple states against his organizations, which are said to have routinely changed or entirely destroyed Democratic voter registrations.

If ACORN had done what Sproul does, they’d all be in jail.

Posted in corruption, crimes, frauds, impunity, Republicans as cancer | 3 Comments »

Charles Murray, relegated to the footnotes

Posted by Charles II on February 2, 2012

Bashing Charles Murray is all the rage since the publication of his book, Coming Apart: The State of White America 1960-2010. Charles Pierce manages to swat Murray and David Brooks with one stroke, while Adam Serwer gets Murray and the American Enterprise Institute with another.

But it’s such overkill. This month, I got Charles Murray as the Cracker Jacks prize in my copy of Imprimis, the magazine produced by Hillsdale College, and mailed to me faithfully every 30 days for over a decade despite the lack of any indication whatsoever that I belong to that tribe.

And Murray does not disappoint. The article he writes, “Do We Need a Department of Education?” is so historically illiterate that the only place that would publish it is… Hillsdale College.

Take the claim that education is not a constitutional function, and that the Framers could not have possibly thought that Congress should get involved because it is not enumerated in Art. I Sec. 8. It’s historically-illiterate baloney, of course, which (after throwing up a giant smokescreen) Murray tacitly admits by saying he’s in the minority on this [fn 1].

Next, Murray asks whether there are any serious problems in education that can only be solved on the federal level. Murray admits that segregation did create a case for federal intervention. He claims that the first major federal spending on education was triggered by Sputnik, which is easily proven false by, well, looking at the facts [fn2] if not also by looking at Murray, who also says that it was in 1965 (eight years after Sputnik) that spending really increased [fn 3], but he contends that the increase in spending justified by desegregation no longer serves a purpose, which is an idiotic argument [fn 4].

Next, Murray asks what the federal track record is. This is not a very smart question and Murray admits that the feds did not cause a decline in educational achievement nor prevent a rise in it [fn 5].

Murray says that “The bachelor of arts degree as it has evolved over the last half-century has become the work of the devil.” [fn 6]

Murray says, contrafactually, that the only positive developments in education have been home schooling and charter schools [fn 7].

In short, the only thing that’s newsworthy about Charles Murray is that anyone pays any attention to him. He’s a fraud who doesn’t even know basic American history, misrepresents and misuses statistics, and lies.

Could be a VP candidate, mebbe.
(Click to read the footnotes)
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Posted in education, frauds, Republicans as cancer | 4 Comments »

Fare and balloonced

Posted by Charles II on December 14, 2011

Or something. Why is this network granted FCC licenses?

Via Hunter at DKos

Real Clear Politics should sue Fox. They won’t, of course, but Real Clear Politics–unlike Fox– does actually have a reputation.

Posted in Fox Noise, frauds, Media machine, Republicans acting badly, Republicans as cancer, Rupert Murdoch | Comments Off on Fare and balloonced

Trading with the enemy: Lying, cheating, stealing is “the Koch method”

Posted by Charles II on October 3, 2011

Asjylyn Loder and David Evans, Bloomberg:

In May 2008, a unit of Koch Industries Inc., one of the world’s largest privately held companies, sent Ludmila Egorova-Farines, its newly hired compliance officer and ethics manager, to investigate the management of a subsidiary in Arles in southern France. In less than a week, she discovered that the company had paid bribes to win contracts.

“Those activities constitute violations of criminal law,” Koch Industries wrote in a Dec. 8, 2008, letter giving details of its findings.

Egorova-Farines wasn’t rewarded for bringing the illicit payments to the company’s attention. Her superiors removed her from the inquiry in August 2008 and fired her in June 2009, calling her incompetent, even after Koch’s investigators substantiated her findings.

A Bloomberg Markets investigation has found that Koch Industries — in addition to being involved in improper payments to win business in Africa, India and the Middle East — has sold millions of dollars of petrochemical equipment to Iran, a country the U.S. identifies as a sponsor of global terrorism.
The ‘Koch Method’

Internal company documents show that the company made those sales through foreign subsidiaries, thwarting a U.S. trade ban. Koch Industries units have also rigged prices with competitors, lied to regulators and repeatedly run afoul of environmental regulations, resulting in five criminal convictions since 1999 in the U.S. and Canada.

From 1999 through 2003, Koch Industries was assessed more than $400 million in fines, penalties and judgments. In December 1999, a civil jury found that Koch Industries had taken oil it didn’t pay for from federal land by mismeasuring the amount of crude it was extracting. Koch paid a $25 million settlement to the U.S.

Phil Dubose, a Koch employee who testified against the company said he and his colleagues were shown by their managers how to steal and cheat — using techniques they called the Koch Method.

Posted in corruption, frauds, impunity, Iran, koch brothers | 1 Comment »

Don’t know much about history…if you listen to the corporate media

Posted by Charles II on July 14, 2011

Robert Parry, Consortium News:

In November 1991, as Newsweek and The New Republic were ridiculing the idea that Ronald Reagan’s campaign chief William Casey might have made a secret trip to meet Iranians in Madrid in 1980, a senior State Department official was informing George H.W. Bush’s White House that Casey indeed had gone to Spain on a mysterious visit.

State Department legal adviser Edwin D. Williamson told associate White House counsel Chester Paul Beach Jr. that among the State Department “material potentially relevant to the October Surprise allegations [was] a cable from the Madrid embassy indicating that Bill Casey was in town, for purposes unknown,” Beach noted in a “memorandum for record” dated Nov. 4, 1991.

In other words, as Newsweek and The New Republic were making the October Surprise story into a big joke in mid-November 1991, Bush’s White House had information that contradicted the smug self-certainty of the two magazines. Not surprisingly, the White House made no effort to clarify the record.

From those records, [Newsweek and The New Republic] concluded that Casey, then Reagan’s campaign chief, had been present for a morning session on July 28, 1980, and thus could not have attended a two-day meeting in Madrid, as described by Iranian businessman Jamshid Hashemi.

Now, this may seem like ancient history. But in 1980, Ronald Reagan won the presidency largely because Jimmy Carter did not succeed in freeing American hostages taken by the Iranian Revolution. Therefore, if Reagan’s camp were responsible for delaying the release of those hostages, one could say that Reagan took power through treason. And not treason defined as, “stuff I don’t like” but treason defined as in Article III, Section III of the US Constitution.” Delaying the release of American hostages would probably qualify. And William Casey traveling to Madrid contradicts what the Administration told the Congress, meaning at the very least that the Administration abetted the obstruction of a Congressional investigation.

William Faulkner said that not only is the past not dead, it’s not even over. US democracy is dying because at a series of critical moments, Republicans seized power through illegitimate means, and the corporate media acted as their accomplices. Those moments were:

1. The McCarthy era.
2. The 1968 election, in which Richard Nixon won election by (treasonously) obstructing the peace accords.
3. The 1972 election, in which Richard Nixon used the power of government to win the election.
4. Perhaps the 1980 election, in which Ronald Reagan may have won election by conspiring with Iran
5. The 1994 election, the Gingrich “revolution” seized power using illegal money, personal smears, and lies.
6. The 2000 election, in which Bush was appointed by the Supreme Court, itself the product of perjury and corruption.

I would argue that the elections after 2000 were all fake elections, in which the media were used as propaganda arms of a corporate state to push the result as far to the right as possible. But we probably won’t know until the whole corrupt mess falls apart, and people are willing to talk.

It’s very likely that none of the post-Watergate elections would have been corrupted if Reagan had been exposed in what increasingly looks like treason. Of course, if elections can simply be bought or stolen, why listen to the voice of the people. Until this poison is drained, and people properly understand why Washington seems less and less responsive to their desires, democracy has no chance.

Posted in corruption, election theft, frauds, Iran Contra, Media machine, mediawhores, ratf*cking | 8 Comments »

Financial crisis, 2.0

Posted by Charles II on November 22, 2010

We really haven’t seen a second wave to the financial crisis. I believed, wrongly it seems, that commercial real estate and jumbo mortgages would lead to defaults large enough to force action of the size that was taken with the collapse of Lehman and the seizure of Bear. Much of the first wave crisis has been written down. Bank profits have been artificially boosted through a kind of corporate socialism involving giving them cheap money to lend at higher prices, taking shaky assets off their books long enough for those assets to stabilize, and engaging their services to buy financial assets in quantitative easing (though estimates that QE2 will cost 50% greater because of this seem ludicrous to me).

But there’s still a number of possible catalysts for a second financial crisis. Today, the hubbub is about Europe: Ireland’s banks are still insolvent, Greece is finding it difficult to impose austerity, and the resultant nervousness is driving up yields in the much larger economies of Spain and Portugal, raising the potential costs of preventing collapse. Certainly there are questions about whether European banks have written off enough of their assets. But although these kind of things may lead to or aggravate depression, they are not the kinds of things that create panics. They have been, at least in part, anticipated.

Panics stem from unanticipated financial changes. Mortgage “fraudclosure” is one of those. If the courts decide to actually enforce the law, the foreclosure process could grind to a halt. That could trigger a decline in the price of mortgage backed securities, threatening bank stability. And now a new potential source for panic emerges. Susan Pulliam, Michael Rothfield, Jenny Strasburg, and Gregory Zuckerman, Wall Street Journal, via The Big Picture:

Federal authorities, capping a three-year investigation, are preparing insider-trading charges that could ensnare consultants, investment bankers, hedge-fund and mutual-fund traders, and analysts across the nation, according to people familiar with the matter.

[continues below the fold]

Read the rest of this entry »

Posted in financial crisis, frauds | 3 Comments »

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