Wall Street’s corruption runs deeper than you can fathom | Alternet

When I joined the Federal Reserve, as you pointed out, I was hired from outside the regulatory world, but within the legal and compliance banking world, to help fix its problems. And I was well aware of the problems that existed. And scoping the problems itself was relatively easy; I mean, within days of arriving, I had participated in meetings where you had Goldman Sachs executives, you know, lying, doublespeaking, and misrepresenting to regulatory agencies without fear of repercussions. And where I saw Federal Reserve regulators actively working to suppress and expunge from the record evidence of wrongdoing that could be used by regulatory agencies, prosecutors, and even the Federal Reserve itself to hold Goldman Sachs accountable. The question was, when I arrived, you know, are these problems fixable? And, spoiler alert: I don’t think so.

And so if a system can be corrupted, people that are allowed to grab hold of power will corrupt it–insofar and only for so long as we allow those people to have the ability and the power to corrupt it. So ultimately, talking about more or less rules, or different rules, is productive only to a point. Because ultimately what we’re talking about here is the haphazard, slap on the wrist, failure to truly enforce the rules and regulations equitably across the system. And that creates the imbalances that you see, for example, in Goldman Sachs, and that you see in the system in general. One of the things that happened as a result of Glass-Steagall coming down was that a lot of the investment bankers were allowed to take over the commercial banks. And those investment bankers knew nothing about banking, and Goldman is a great example of that. I mean, when I arrived three years in after the financial crisis, what was one of the things that was very shocking to me was going into meeting after meeting with Goldman senior management and hearing them lie, doublespeak, and most shockingly of all, insist that they didn’t have to comply with the law. And that is a problem. Because a bank that doesn’t believe, or management at a bank that doesn’t believe they have to comply with the law–you bet they are not supervising their employees correctly, and they’re not incentivizing employees correctly in terms of how to do their job. So their behavior is injecting enormous risk into the system.

CS:Yeah. And I would sort of add that part of what the book sort of points out is that I didn’t really get my say. I mean, Congress did hold a hearing, but they did not invite me to testify. They didn’t want to hear what I had to say. And so I think what we have in terms of this story is really not just a failure of the banks and the regulators, but also a failure of our prosecutors. I mean, a lot of the statutes that could be used–criminal statutes, even, that could be used to hold these executives accountable are not being used, and they have not expired; we could have prosecutors holding these people accountable. We could have trial lawyers filing cases and holding these people accountable. Yet we can’t count on them to do it; we can’t count on the judiciary to do anything about it. I mean, when you read about what happened in my case in the book, it’s tragic, you know? It’s unbelievable.

RS:Tell us about that. Because you had a judge who was actually deep into this system who threw your case out.

CS:The case was assigned to a judge who was friends with the attorney, I had worked with the attorney that represented the Fed. And then two days before dismissing the case, she revealed that she was married to someone who represented Goldman Sachs for a living. So, yeah, there you go. [Laughs]

via Wall Street’s corruption runs deeper than you can fathom | Alternet

The total SYSTEMIC corruption that is symbolized in part by Trump are part of why AGR predicts that one to many of the bubbles will collapse soon. Huge corporations, lawyers, judges and the government are all so corrupt, that only total collapse can cleanse the system at this point. Either that, or a total transformation has to take place fairly quickly.

One thought on “Wall Street’s corruption runs deeper than you can fathom | Alternet”

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s