Category Archives: Uncategorized

By Pam Martens: September 11, 2013 In February of this year, the Consumer Financial Protection Bureau (CFPB), the new Federal agency that Senator Elizabeth Warren fought so hard to create against a tsunami of backlash from Wall Street and Republican ranks, asked the public to comment on making college more affordable and to describe their student loan experiences with private lenders. There was a tidal wave of nearly 30,000 responses. Public interest groups, nonprofit community programs, and thousands of college graduates responded. The most tragic stories came from students who augmented their Federal student loans with loans from the big Wall Street banks like Citibank, a unit of the bailed out poster child for bad behavior, Citigroup. Citibank borrowers tell horror stories of living without heat, living on food donations from friends, and watching their monthly student loan payment skyrocket without warning from $374 to $1025.53. The levels of stress and … Continue reading →

By Pam Martens: September 10, 2013  Citibank, the insured depository bank of the global behemoth, Citigroup, was bailed out by the U.S. taxpayer from 2008 through 2010 with over $2 trillion dollars in equity infusions, asset guarantees and loans of under one percent interest from the Federal Reserve. The far flung financial enterprise was bailed out despite a serial history of abusing its customers – crimes for which its regulators have imposed large fines and little justice. The undisputed reality is that the shareholders of Citigroup would be holding worthless stock today were it not for the company’s rescue by taxpayers during the Wall Street collapse five years ago. And yet, today, based on reports from coast to coast, the company is engaging in egregious abuses of struggling young college graduates who took out private student loans from Citibank. The generosity that the U.S. Congress, and Treasury and Federal Reserve lavished … Continue reading →

By Pam Martens: September 9, 2013 Wall Street has marshaled every ounce of political and public relations clout it can muster to defeat Eliot Spitzer from advancing into the position of New York City Comptroller. The New York City primary is tomorrow and, like clockwork, today’s Wall Street Journal’s opinion page features a vicious attack on Spitzer by Paul Atkins, a former SEC Commissioner turned public relations pro/opinion writer/media pundit and consultant to Wall Street. Atkins heads a firm, Patomak Global Partners, that provides consulting and litigation support to the financial services industry. Its web site boasts that “Our professional team includes two former Commissioners and a former General Counsel of the Securities and Exchange Commission, a former member of the Board of Governors of the Federal Reserve System, and others with diverse backgrounds and senior management experience in both public and private sector leadership positions.” In other words, they … Continue reading →

By Pam Martens: September 5, 2013 Yesterday, mainstream media was busy framing the news that JPMorgan is now under an eighth investigation by the U.S. Justice Department, this time a criminal probe into whether some of its employees obstructed the investigation by the Federal Energy Regulatory Commission (FERC) into the company’s manipulative trading of electricity in California and the Midwest. This is a highly unusual development for a number of reasons. FERC settled its claims against JPMorgan Ventures Energy Corporation for $410 million on July 30 of this year. That amount included a civil penalty of $285 million to the U.S. Treasury and a disgorgement of $125 million to be returned to ratepayers. Typically, when a company pays a settlement of that size, its lawyers have made sure there are no loose ends – especially not a criminal probe waiting in the wings. Once the money is paid out, the bank … Continue reading →

By Pam Martens: September 4, 2013  Someone needs to instant message Standard and Poor’s Financial Services LLC a legal tip: when you’re in a hole, stop digging. That would be potentially more sage advice than it’s currently getting from the three law firms representing it in its court battle with the U.S. Justice Department over the alleged bogus ratings it assigned to subprime Residential Mortgage-Backed Securities (RMBS) and Collateralized Debt Obligations (CDOs) in the run up to the Wall Street financial collapse in 2008.  In a court filing yesterday, S&P attempted to cast aspersions on the motives of the government in bringing the suit, telling the court:  “Plaintiff commenced this action in retaliation for Defendants’ exercise of their free speech rights with respect to the creditworthiness of the United States of America. Such free speech is protected under the First Amendment to the United States Constitution and the retaliation, causing … Continue reading →

By Pam Martens: September 3, 2013  After the greatest economic collapse since the Great Depression, after endless hearings in Congress going nonstop since 2008, after the voluminous report from the Financial Crisis Inquiry Commission, one would think we should know a great deal about the largest Wall Street banks that created the havoc and that stringent laws would have quickly been put in place to prevent another repeat.   Tragically, a Nation that can transmit trading data between New York and Chicago in 13.1 milliseconds, still has no idea what the biggest banks on Wall Street own or what threats those black holes of information pose to the national economy. This lack of transparency, combined with the failure of the 2010 Dodd-Frank financial reform legislation to, as yet, impose restraints on speculative trading (Volcker rule) and position limits on trades, renders the Wall Street of today even more dangerous than the Wall … Continue reading →

By Pam Martens: August 29, 2013  The Public Banking Institute has released a new video making serious claims, backed by graphs and government documents, that the largest Wall Street banks are an unsafe choice for the savings of moms, pops and public payrolls. Citing a December 10, 2012 jointly approved plan between the U.S. Federal Deposit Insurance Corporation (FDIC) and the Bank of England, which resides on the FDIC’s federal web site, the organization says depositors in the U.S. could see portions of their deposits confiscated, similar to what happened in Cyprus, should there be another Wall Street collapse as occurred in 2008.  The first question, of course, is why the U.S. government is negotiating its banking policy with the United Kingdom instead of the U.S. Congress. The obvious answer is that global banks, now allowed to troll the planet in search of the next high-flying derivatives trade, must harmonize … Continue reading →

By Pam Martens: August 28, 2013  One day after terrorists set off a bomb at the Boston Marathon leaving a tragic trail of senseless human suffering, the U.S. House of Representatives held a scheduled hearing to debate another form of terrorism – the kind of economic terrorism that gripped the United States from 2008 to 2010 and lingers today in the form of 46 million Americans living in poverty, mass underemployment, stagnating wages, a shaky housing market, tepid GDP growth and ballooning national debt. The House was debating the “grave threat” to the Nation posed by the too-big-to-fail banks. You likely didn’t hear about the hearing because the media was focused on the Boston Marathon and its more easily understood, visually shocking form of terrorism.  On April 16, 2013, members of the House Oversight and Investigation Subcommittee of the Financial Services Committee wanted to learn more about two words, “grave … Continue reading →

By Pam Martens: August 27, 2013  George Melloan has done a deep disservice to the ever-shrinking pool of ethical investigative writers covering Wall Street, civic-minded prosecutors, and to the underpaid but dedicated career regulators overseeing the financial markets. (No, the revolving door from Wall Street to Washington hasn’t quite killed off all that is good.)  Yesterday, Melloan penned an opinion piece for the Wall Street Journal that was so Koch-esque, so preposterously skewed, and so utterly lacking in factual basis that it must be called out. Melloan makes the claim that the big banks aren’t doing anything more egregious than they have done in the past and the growing charges of fraud are the product of overly zealous regulators, “encouraged by the Obama administration” to blame the nation’s economic ills “on the rich, Wall Street, moneybags bankers, deal makers like Mitt Romney or almost anyone else who still wears a suit … Continue reading →

By Pam Martens: August 26, 2013  The sine qua non of image handlers dealing with negative revelations in the media is to infuse the happy faces of children and puppies into the equation.  Did you hear that the Obamas have a new puppy? Her name is Sunny and like her big brother, Bo, she’s a Portuguese Water Dog. There’s photos and even a video at WhiteHouse.gov showing the adorable pair frolicking on the White House lawn.  As former NSA contractor, Edward Snowden, has continued to leak documents to newspapers showing that President Obama has overseen a surveillance dragnet on innocent Americans and U.S. allies, raising serious questions about this former constitutional law professor’s respect for democratic ideals, the President took to the road in a bus during the month of August to promote a new agenda to help the middle class. This past weekend the emphasis was on making college … Continue reading →