Category Archives: Choke Point

$6Billion in Fines for Rigging Currency

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Just pay the fine and no one goes to jail. Those that pay the billions in fines are the stockholders, there is never a personal or individual consequence. Jamie Dimon should have been in prison years ago, next to Bernie Madoff. Even more troubling is Jon Corzine with his criminal activity.

Attorney General, Loretta Lynch knows the depths of the fraudulent activity and seems to be complicit in giving individuals a blind-eye.

Big banks to pay $6B for market manipulation

Six of the biggest names in finance have agreed to pay nearly $6 billion dollars in penalties, with five pleading guilty to criminal charges over long-running manipulation of key financial markets.

The Justice Department announced the massive settlement Wednesday, its latest in a series of deals to bring to a close probes of financial manipulation of everything from benchmark interest rates to top currency exchanges.

Attorney General Loretta Lynch said the latest settlement brings to an end a manipulation scheme of “breathtaking flagrancy,” in which traders conspired to artificially alter currency exchange markets to obtain illicit profits.

U.S. authorities said that traders from competing banks frequently used chat rooms to conspire with each other to maximize profits for their institutions by manipulating currency trades, forming a group they dubbed “the cartel.” Dating back to 2007, Lynch said traders “acted as partners rather than competitors” in a “brazen display of collusion.”

The banks will pay the Justice Department and the Federal Reserve a total of $5.7 billion in criminal penalties, with most of the institutions also agreeing to plead guilty to some criminal charges.

Barclays, Citigroup, JPMorgan and the Royal Bank of Scotland all agreed to plead guilty to charges of conspiring to fix prices. UBS agreed to plead guilty to charges stemming from a previous investigation after the bank’s role in this new probe led the Justice Department to toss out a prior agreement not to seek criminal charges. Bank of America agreed to pay a fine as well.

The announcement is just the most recent in a string of settlements the government has struck with huge banks over industrywide bad behavior.

In April, Deutsche Bank agreed to pay a record $2.5 billion in fines, and fire several employees, for its role in rate-rigging. And in November, five large banks agreed to pay a combined $4.25 billion in penalties to U.S. and British authorities.

But those eye-popping numbers are unlikely to tamp down complaints from some lawmakers, like Sen. Elizabeth Warren (D-Mass.), and from outside groups that complain the government has failed to bring charges against top executives for illegal activity at their banks. Rather, they contend banks are happy to continue paying large fines as the cost of doing business.

On Tuesday, UBS announced it will pay $545 million to settle claims that it was manipulating the foreign exchange market. The bank also noted that the Justice Department terminated a 2012 non-prosecution agreement it struck with the bank, which was part of a previous settlement over interest-rate-rigging where the bank paid $1.5 billion.

But the government argued that the new charges violated the terms of that deal.

While the bank faces no criminal charges from the recent currency probe, the bank agreed to plead guilty to wire fraud stemming from the previous rate-rigging investigation, and attributed the misbehavior to “a small number of employees.”

Bank CEOs Blame Currency Rigging on the Work of a Few Bad Apples

Wall Street’s biggest banks admitted Wednesday to rigging currency markets around the world. Within minutes of the Justice Department’s announcement, they were blaming it on a few rotten apples.

“I share the frustration of shareholders and colleagues that some individuals have once more brought our company and industry into disrepute,” Barclays Plc Chief Executive Officer Antony Jenkins said in a statement announcing his bank’s guilty plea.

JPMorgan Chase & Co. CEO Jamie Dimon also pointed a finger at a few currency traders.

“The lesson here is that the conduct of a small group of employees, or of even a single employee, can reflect badly on all of us,” Dimon said in a statement.

Dimon ran his bank during the length of the currency conspiracy, which the Justice Department said lasted from 2007 through 2013. Jenkins has been CEO of Barclays since 2012.

Barclays and JPMorgan were among banks that didn’t detect and address traders’ illegal cooperation to manipulate benchmark currency prices, the Federal Reserve said Wednesday. Among the clues they missed: an instant-message group called “The Cartel,” where dealers exchanged information on client orders and decided how to trade.

Under a $5.8 billion settlement, JPMorgan, Barclays and units of Citigroup Inc. and Royal Bank of Scotland Group Plc agreed to plead guilty to conspiring to manipulate the price of U.S. dollars and euros.

‘Ethical Behavior’

Attorney General Loretta Lynch said at a news conference in Washington that the investigation is continuing. The Justice Department may bring charges against individuals, according to people familiar with the matter.

“Fostering a culture of ethical behavior has been, and continues to be, a top priority” for Citigroup, CEO Michael Corbat said in a statement. He added that the bank’s “internal investigation has so far resulted in nine terminations and additional disciplinary actions.”

RBS pinned the blame for violating U.S. antitrust law on one currency trader. Still, Chairman Philip Hampton said that more people may have been involved.

“We have dismissed three people and suspended two more pending further investigation,” Hampton said in a statement.

WH Task Force-Retooling Nations Law Enforcement

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Enter the new protected class as mandated by the White House Task Force, titled 21st Century Policing.

EXECUTIVE ORDER 13684 signed by Barack Obama is de-facto altering law enforcement across America. A sample action item includes:

Decouple federal immi-gration enforcement from routine local policing for civil enforcement and nonserious crime.

Another action item:

Law enforcement agencies should adopt and enforce policies prohibiting profiling and discrimination based on race, ethnicity, national origin, religion, age, gender, gender identity/expression, sexual orientation, immigration status, disability, housing status, occupation, or language fluency.

There are many action items in the White House mandate found here.

 

The need for understanding, tolerance, and sensitivity to African Americans, Latinos, recent immigrants, Muslims, and the LGBTQ community was discussed at length at the listening session, with witnesses giving examples of unacceptable behavior in law enforcement’s dealings with all of these groups. Participants also discussed the need to move towards practices that respect all members of the community equally and away from policing tactics that can unintentionally lead to excessive enforcement against minorities.

Witnesses noted that officers need to develop the skills and knowledge necessary in the fight against terrorism by gaining an understanding of the links between normal criminal activity and terrorism, for example. What is more, this training must be ongoing, as threats and procedures for combatting terrorism evolve.

The Federal Government should support the development of partnerships with training facilities across the country to promote consistent standards for high quality training and establish training innovation hubs.

A starting point for changing the culture of policing is to change the culture of training academies. The designation of certain training academies as federally supported regional “training innovation hubs” could act as leverage points for changing training culture while taking into consideration regional variations. Federal funding would be a powerful incentive to these designated academies to conduct the necessary research to develop and implement the highest quality curricula focused on the needs of 21st century American policing, along with cutting-edge delivery modalities.

Get paid to protest law enforcement…it is lucrative.

Even ABC News found some alarming issues in the White House agenda.

6 Things the Obama Administration Is Doing to Improve Police-Community Relations

Amid continued tension between police and communities of color, President Obama will travel to Camden, New Jersey this afternoon to highlight the city’s efforts improve police-community relations.

In cities like Camden, “for too long, both jobs and hope have been hard to find. That sense of unfairness and powerlessness has helped to fuel the kind of unrest we’ve seen in Ferguson and Baltimore and New York and other cities across our country,” White House senior advisor Valerie Jarrett told reporters. “It has many causes, from a basic lack of opportunity to folks feeling unfairly targeted by the police.”

But Camden – recently named a “promise zone” and a My Brother’s Keeper community challenge partner – is making strides, and the Obama administration wants to help other cities follow suit.

Here are six things they’re doing to shore up trust between law enforcement and minority communities:

1. Confidence ‘Blueprint’

After months of study by the president’s task force on 21st century policing, administration today is releasing its final “blueprint” for building trust between officers and the communities they serve.

“I can tell you, there is widespread understanding by the police that police- community relations must be improved, especially in communities of color,” Ron Davis, a former police chief who now heads the Justice Department’s COPS Office told reporters.

“We are without a doubt sitting at a defining moment in American policing,” Davis said. “We have a unique opportunity to redefine policing in our democracy, to ensure that public safety is more than the absence of crime, that it must also include the presence of justice.”

2. Data, Data, Data.

Statisticians, get ready: the White House has also launched a police data initiative designed to increase transparency and identify problematic trends.

According to officials, 21 jurisdictions have committed to release 101 data sets not previously accessible to the public, like reports on use of force, pedestrian and vehicle stops, and officer-involved shootings. (The administration’s “open data playbook” will set out best practices for other jurisdictions that want to post data publicly.)

“It’s equally important that we educate the community so they set the expectation for their agencies to follow those practices and not just leave it up to the police department by itself,” Davis said yesterday.

Internal data will be shared with analysts who can, in the words of Domestic Policy Council Director Cecilia Munoz, “identify patterns to prevent problems or problematic behaviors before they lead to a crisis situation.”

3. $163 Million

The Justice Department today is announcing $163 million in hiring grants for positions focused on building community trust.

4. Virtual Body Cam Toolkit

In the wake of the Ferguson protests last year, President Obama pledged $75 million to buy 50,000 body cameras.

Today, the Justice Department is launching a web-based “toolkit” laying out best practices for hardware, software, and data storage, as well as dealing with public information requests, civilian privacy issues, and officers’ rights issues.

5. Bayonets, Be Gone

To curb the “militarization” of local police that upset so many people during the Ferguson protests, President Obama has authorized a series of recommendations to regulate the transfer of equipment from federal agencies to state/local law enforcement.

The plan divides equipment into two main categories: (1) “prohibited” equipment – including bayonets, grenade launchers, weaponized aircraft, tracked armored vehicles and large caliber weapons – that have been deemed inappropriate for local law enforcement and should not be made available local police “under any circumstances,” and (2) “controlled” equipment – including riot gear, explosives, armored vehicles, and specialized firearms – that police departments can acquire only if they comply with certain “vigorous” controls.

“The idea is to make sure that we strike a balance in providing the equipment which is appropriate and useful and important for local law agencies to keep the community safe, while at the same time putting standard in places,” Munoz said.

To obtain controlled equipment under these new recommendations, law enforcement agencies have to gain the consent of a local civilian governing body such as a mayor or city council and provide a “clear and persuasive explanation” for why the department needs the equipment. They’ll also be required to complete additional training in community and constitutional policing and collect data on how the equipment is used – particularly if it is involved in a “significant incident.”

6. National Community Policing Tour

Newly confirmed Attorney General Loretta Lynch is slated to travel to Cincinnati as part of a “national community policing tour.”

Lynch’s aides have indicated that one of her first priorities will be improving police morale and finding common ground between officers and minority communities.

 

How DID Obama Corrupt ICE Procedures?

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‘Immigration and Naturalization Services has/had been in effect since the 1950’s using a program called Secure Communities. (But not anymore)

Secure Communities is a simple and common sense way to carry out ICE’s priorities. It uses an already-existing federal information-sharing partnership between ICE and the Federal Bureau of Investigation (FBI) that helps to identify criminal aliens without imposing new or additional requirements on state and local law enforcement. For decades, local jurisdictions have shared the fingerprints of individuals who are arrested or booked into custody with the FBI to see if they have a criminal record. Under Secure Communities, the FBI automatically sends the fingerprints to DHS to check against its immigration databases. If these checks reveal that an individual is unlawfully present in the United States or otherwise removable due to a criminal conviction, ICE takes enforcement action – prioritizing the removal of individuals who present the most significant threats to public safety as determined by the severity of their crime, their criminal history, and other factors – as well as those who have repeatedly violated immigration laws.

‘The Obama Administration’s announcement on November 20, 2014, that it is replacing the Secure Communities program with a new Priority Enforcement Program (PEP) may moot certain questions, since detainers are to be used differently with PEP than with Secure Communities.’

With little fanfare or media reporting, this termination of one program for the sake of another has proven to be a major threat to national security as directed by the Department of Homeland Security where detainers are solely at the discretion of conditions that no one understands including judges hearing cases. In short however, those being detained by ICE are the worst of the worst and time is against ICE due in part of a 48 hour detention limitation where all background investigation evidence must be attached. Sounds simple, but it is hardly simple or easy at all. Felons, not families, criminals not children, gangs not traffickers of narcotics. Even Secretary of DHS, Jeh Johnson signed a memo that this new White House operation failed.

Then there is a major question of which agency has custody of those detained. What? Does it really matter? Just the facts……

Some have also suggested that a federal regulation—which provides that law enforcement agencies receiving immigration detainers “shall maintain custody of the alien for a period [generally] not to exceed 48 hours”—means that states and localities are required to hold aliens for ICE. Prior versions of Form I-247 may also have been construed as requiring compliance with detainers. However, in its recent decision in Galarza v. Szalczyk, the U.S. Court of Appeals for the

Third Circuit rejected this view. Instead, it adopted the same interpretation of the regulation that the Department of Homeland Security (DHS) has advanced, construing it as prescribing the maximum period of any detention pursuant to a detainer, rather than mandating detention.

In addition, questions have been raised about who has custody of aliens subject to detainers, and whether the detainer practices of state, local, and/or federal governments impinge upon aliens’ constitutional rights. Answers to these questions may depend upon the facts and circumstances of particular cases. For example, courts have found that the filing of a detainer, in itself, does not result in an alien being in federal custody, although aliens could be found to be in federal custody if they are subject to final orders of removal. Similarly, holding an alien pursuant to a detainer when there is not probable cause to believe the alien is removable could be distinguished from holding an alien when there is probable cause, or when the alien is subject to a removal order.

The Department of Homeland Security (DHS) emphasized that it prioritized “criminal aliens,” those who posed a threat to public safety, and repeat immigration violators for removal through Secure Communities,6and the former Director of ICE further instructed that, among “criminal aliens,” the focus was to be upon those convicted of “aggravated felonies,” as defined in the Immigration and Nationality Act (INA); those convicted of other felonies; and those convicted of three or more misdemeanors.

*** So all this begs new questions yet to be addressed. Exactly where did those crime occur and who has that information with regard to those immigrants now in the U.S. illegally? How bad were those crimes? What names were used or have since been changed? Syria, Iraq, China, Pakistan…do any of these countries have historical records on people that they are providing to ICE, Border Patrol, the FBI or the State Department? Facts say no. How many Mohammad’s are now Jose?

Just this past November, the Barack Obama attached his name to a FACT SHEET for accountability Executive Action. Here is the ‘eye-roll’.

The President’s Immigration Accountability Executive Actions will help secure the border, hold nearly 5 million undocumented immigrants accountable, and ensure that everyone plays by the same rules.  Acting within his legal authority, the President is taking an important step to fix our broken immigration system.

These executive actions crack down on illegal immigration at the border, prioritize deporting felons not families, and require certain undocumented immigrants to pass a criminal background check and pay their fair share of taxes as they register to temporarily stay in the U.S. without fear of deportation.

These are common sense steps, but only Congress can finish the job. As the President acts, he’ll continue to work with Congress on a comprehensive, bipartisan bill—like the one passed by the Senate more than a year ago—that can replace these actions and fix the whole system.

Three critical elements of the President’s executive actions are:

Cracking Down on Illegal Immigration at the Border:  The President’s actions increase the chances that anyone attempting to cross the border illegally will be caught and sent back. Continuing the surge of resources that effectively reduced the number of unaccompanied children crossing the border illegally this summer, the President’s actions will also centralize border security command-and-control to continue to crack down on illegal immigration.
Deporting Felons, Not Families: The President’s actions focus on the deportation of people who threaten national security and public safety. He has directed immigration enforcement to place anyone suspected of terrorism, violent criminals, gang members, and recent border crossers at the top of the deportation priority list.
Accountability – Criminal Background Checks and Taxes: The President is also acting to hold accountable those undocumented immigrants who have lived in the US for more than five years and are parents of U.S. citizens or Lawful Permanent Residents.  By registering and passing criminal and national security background checks, millions of undocumented immigrants will start paying their fair share of taxes and temporarily stay in the U.S. without fear of deportation for three years at a time.
The President’s actions will also streamline legal immigration to boost our economy and will promote naturalization for those who qualify. Read the full fact sheet here.

 

 

 

DOJ Sends Bad Lawyers to Court, Good Thing

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Switchboard operator: Commissioner Koskinen, Loretta Lynch, Jack Lew, you are being paged to answer calls on lines 4,5 and 6.

Remember that pesky IRS targeting scandal that the White House said was phony? Remember groups that applied for tax exempt status were discriminated against at the direction of Lois Lerner? Remember Lerner going to the Department of Justice to get some legal advise when the IRS is actually under the Treasury Department who has lawyers and even the IRS has their own? Well, lawyers in Washington DC appear to have lousy skills at presenting an argument in this case…defense.

The DOJ actually argued it was okay to discriminate for a period of time. Really? Yes, discrimination IS fair….well not so much.

The IRS Goes to Court

The agency suggests it can discriminate for 270 days. Judges gasp.

It isn’t every day that judges on the D.C. Circuit Court of Appeals declare themselves “shocked.” But that happened on Monday when an animated three-judge panel eviscerated the IRS and Justice Department during oral argument in a case alleging the agency delayed the tax-exempt application of a pro-Israel group due to its policy views.

In December 2009, Pennsylvania-based Z Street applied for 501(c)(3) status to pursue its pro-Israel educational mission. In July 2010, when the group called to check on what was taking so long, an IRS agent said that auditors had been instructed to give special attention to groups connected with Israel, and that they had sent some of those applications to a special IRS unit for additional review.

Z Street sued the IRS for viewpoint discrimination (Z Street v. Koskinen), and in May 2014 a federal district judge rejected the IRS’s motion to dismiss. The IRS appealed, a maneuver that halted discovery that could prove to be highly embarrassing. Justice says Z Street’s case should be dismissed because the Anti-Injunction Act bars litigation about “the assessment or collection of tax.” Problem is, Z Street isn’t suing for its tax-exempt status. It’s suing on grounds that the IRS can’t discriminate based on point of view.

The three judges—Chief Judge Merrick Garland,David Tatel and David Sentelle—were incredulous. You say they want a tax exemption, but that’s not the complaint, Judge Sentelle admonished government lawyer Teresa McLaughlin: “They are not in court seeking to restrain the assessment or collection of a tax, they are in court seeking a constitutionally fair process.”

The suit should also be foreclosed, the government argued, because under Section 7428(b)(2) of the Internal Revenue Code groups may sue to obtain their tax-exempt status if no action has been taken for 270 days, and that should be an alternative to Z Street’s approach.

“You don’t really mean that, right? Because the next couple words would be the IRS is free to discriminate on the basis of viewpoint, religion, race [for 270 days]. You don’t actually think that?” Judge Garland said. “Imagine the IRS announces today a policy that says as follows: No application by a Jewish group or an African-American group will be considered until one day short of the period under the statute . . . Is it your view that that cannot be challenged?”

The judges also asked why the government had buried the key precedent in a footnote in its brief. In Direct Marketing Association v. Brohl, the Supreme Court decided that the language of the Anti-Injunction Act did not preclude cases like Z Street’s. In a previous case before the D.C. Circuit, Judge Garland noted, the court also “rejected” the exact arguments the government was making, “so in a way we have already decided every issue before us today, against you.”

Poor Ms. McLaughlin was sent to argue the indefensible so the IRS can delay discovery until the waning days of the Obama Administration. “If I were you, I would go back and ask your superiors whether they want us to represent that the government’s position in this case is that the government is free to unconstitutionally discriminate against its citizens for 270 days,” said Judge Garland.

Ms. McLaughlin replied, “Well, I will take that back.” The Beltway media may be bored, but the IRS scandal is a long way from over.

HUD, the Coming Next Financial Crisis

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Do you know the Castro twins, Julian and Joaquin? Well, both have been fully groomed by powerbrokers in the Obama administration and the mentoring continues. In fact, the twins are rightly classified as the ‘enemies within’.

Julian is the Secretary of Housing and Urban Development and Joaquin is a U.S.Congressman. Julian is especially dangerous and there is chatter about his vying for a vice-presidential run. Meanwhile, Julian is in large measure part of the Latino immigration movement while working his wonder-lust at HUD.

So what about the coming financial crisis? Just think back to the housing crisis, to the toxic mortgages, to the bailouts and the massive layoffs.

The Government Is Definitely Back in the ‘Affordable Housing’ Game

by: John Ligon

More than six years out from a government-driven housing bubble, the chief regulator at the Federal Housing Finance Agency, Mel Watt, and the Department of Housing and Urban Development secretary, Julian Castro are respectively clearing a path to expand the “credit box” for government-backed home loans.

Two recent examples: Fannie Mae recently started a program guaranteeing loans with as little as 3 percent down payments, and, earlier this year, the Federal Housing Administration reduced by 50 basis points the annual mortgage insurance premiums it charges borrowers.

We have been down this path before. Using the U.S. housing finance system to try to achieve political ends of broader and “affordable” housing goals ultimately undermines taxpayer safety and the opportunity to build meaningful equity for homeowners.

After all, it was only less than two decades ago that Andrew Cuomo, then-Housing secretary under the Clinton administration, announced that Fannie Mae and Freddie Mac, the two largest housing finance companies at that time, would be required to buy $2.4 trillion in mortgages over the next 10 years to provide affordable housing for about 28.1 million low- and moderate-income families.

In the same announcement, Cuomo went on to say that “this action will transform the lives of millions of families across our country by giving them new opportunities to buy homes or move into apartments with rents they can afford … it will help ease the terrible shortage of affordable housing plaguing far too many communities.”

To be fair, political leaders in both Democrat and Republican administrations have repeatedly called for arbitrary, vague goals aimed at achieving a “homeownership society” and expanding “affordable housing” even when most qualified homeowners already owned homes.

A great irony, though, is that these affordable housing initiatives have had the exact opposite of their intended impact: These programs encourage higher levels of debt, increased housing prices (and lower affordability) in many markets, and greater risk within the overall housing finance system.

Affordable housing advocates tend to focus on high rental costs and widespread slack in the first-time home purchase market as main justification for expanded government support, but establishing new government credit programs and expanding existing ones has repeatedly failed to fix these problems.

To be sure, there are numerous factors weighing on the overall housing market outlook, and certainly a main influence is the sluggish first-time purchase market. This market, in particular for younger individuals, is hampered by high levels of non-mortgage debt, weak employment and income opportunities, low labor mobility (some held back by federal mortgage modification programs), and high home prices in some metropolitan areas.

Despite any of the best stated intentions to assist individuals with “affordable rent” or “affordable mortgages,” all of this direct and indirect government interference in the housing finance system ultimately biases individuals toward certain market segments and particular types of debt instruments, increasing financial risk to homeowners and taxpayers in the process.