Tag Archives: William Black

look who’s coming into the cross-hairs next…

I’ve now been writing this blog for just about two years, and this will be my 200th post. Being something of an anniversary then, I’ve been wondering how to mark the occasion. How about some kind of a retrospective, for instance… reviewing my earlier reports on the decline of the world’s economy as an inevitable consequence of systemic fraud and failure; or the rise of the surveillance state with the introduction of fingerprinting of kids in Britain and of drones over America; or the serious environmental threat from nuclear power and fracking (this ultra-destructive ‘technology’ coming to Britain almost immediately after I first heard and wrote about it!); mixed in perhaps with another reminder of how the neo-imperialist wars of the twenty-first century are being expanded into Africa and why the civil war in Syria is really just a proxy war with the al-Qaeda-led rebel forces being covertly supported by their own sworn enemy, America. (To read posts on any of the above just follow the relevant links from the main menu or use the search tool.)

However, to do justice to such a monumental post would possibly have taken a month or more. All the troubles I have written about, and sadly with very few exceptions, worsening during the past two years; our descent into chaos and tyranny happening quicker now than before I began.

More wars; more environmental devastation in the name of environmental protection; greater infringement of our civil liberties and human rights; and an economy that is teetering on the very edge of total collapse. Indeed, the economic situation is now so bad that on BBC2’s Newsnight a few nights ago [Tuesday 19th], Jeremy Paxman was reduced to interrogating an MP from Cyprus. And just think about that for a moment, and bear in mind that Cyprus (and I mean no offence to Cypriots when I say this) is an economic gnat. Yet we are seriously contemplating how the effects of a debt problem in Cyprus might undo the entire Eurozone. All of which is actually a measure of how broken the banking system has become.

Yes, the financial system of much of the world (and especially our region of it) is bankrupt, and has been for some time. The reason is the multiple hundreds of trillions of dollars of so-called ‘toxic’ derivatives that have still yet to be deleted. But instead of cancelling the odious debts and prosecuting a corrupt banking establishment, the proposed solution is instead to openly steal money from personal bank accounts in order to keep the Ponzi scheme up and running just a little longer. This brazen theft being described in places like the BBC as “a haircut” or “a tax on savings”. You just can’t make it up any more! And sooner or later, we must expect that all of this will be coming to a bank nearby…

Those who have listened carefully to people really in the know, like former regulator William K Black, are aware not only of the real cause of this crisis (and the resulting depression which the mainstream media have also helped to play down) but also precisely who is really to blame – and let’s name names here: hands up Moody’s, Standard & Poor’s, and Fitch! The three credit rating agencies who gave triple-A’s to toxic trash on the basis of mere opinion and yet continue to downgrade the credit worthiness of nation states in a deepening crisis which they were instrumental in starting… you really can’t make this up! And hands up Goldman Sachs, J.P Morgan, Citibank, Barclays, HSBC, and all the cronies in government, at the ECB, the Bank of England, the Federal Reserve, the IMF, and not forgetting the FSA and other supposed “regulatory agencies”. Agencies working for whom and to what ends, we may all reasonably demand.

It is the greed, incompetence and malfeasance across the whole of the financial sector that has brought us to this brink. It was never the fault of “the lazy Greeks” and it’s not the fault of pesky Cypriots either, but the mainstream media still hesitates at telling the people the truth – and why? Just how deep does the cronyism run…?

I hate to say this but quite frankly our world, by which I mean our civilisation, is going to hell in a handbasket. Because just as our economies collapse, and the social structures we rely upon follow, at very same time the controls on us are being tightened one notch at a time, and at an accelerating rate. This is another big theme I have returned to time and again. How in America there was Obama’s introduction of the NDAA “indefinite detention act”, and how in Britain we look set to get our own secret trials too. How in America (and most probably in Britain, although here the available evidence is less certain) there is already universal surveillance of internet activity and soon (certainly if Obama gets his way) of bank accounts too.1

These are the considered thoughts of veteran investigative journalist John Pilger, writing almost a year ago an article on his own website entitled “You are all suspects now. What are you going to do about it?”:

You are all potential terrorists. It matters not that you live in Britain, the United States, Australia or the Middle East. Citizenship is effectively abolished. Turn on your computer and the US Department of Homeland Security’s National Operations Center may monitor whether you are typing not merely “al-Qaeda”, but “exercise”, “drill”, “wave”, “initiative” and “organisation”: all proscribed words. The British government’s announcement that it intends to spy on every email and phone call is old hat. The satellite vacuum cleaner known as Echelon has been doing this for years. What has changed is that a state of permanent war has been launched by the United States and a police state is consuming western democracy.

What are you going to do about it?

In Britain, on instructions from the CIA, secret courts are to deal with “terror suspects”. Habeas Corpus is dying. The European Court of Human Rights has ruled that five men, including three British citizens, can be extradited to the US even though none except one has been charged with a crime. All have been imprisoned for years under the 2003 US/UK Extradition Treaty which was signed one month after the criminal invasion of Iraq. The European Court had condemned the treaty as likely to lead to “cruel and unusual punishment”. One of the men, Babar Ahmad, was awarded 63,000 pounds compensation for 73 recorded injuries he sustained in the custody of the Metropolitan Police. Sexual abuse, the signature of fascism, was high on the list. Another man is a schizophrenic who has suffered a complete mental collapse and is in Broadmoor secure hospital; another is a suicide risk. To the Land of the Free, they go – along with young Richard O’Dwyer, who faces 10 years in shackles and an orange jump suit because he allegedly infringed US copyright on the internet. 2

Click here to read John Pilger’s full article.

Meanwhile, of course, the neo-imperialist adventuring remains not only unchecked, but is actually gathering momentum. The war racket pressing full-steam ahead and flattening all before it. It doesn’t matter that we don’t have money to fix our broken hospitals, or to build houses and renew infrastructure, or that in America there are fifty million people already on food stamps – and if you picture those people in sepia forming a queue then you’ll see how this depression has already reached 1930s levels. But in spite of these hardships at home, no amount of money is ever spared when it comes the next country on our checklist for “humanitarian intervention” – and more thoughts on this in my next post.

So these days I am finding every post I write is harder than the last. How many ways are there to say that nuclear power and fracking are a menace not only to human beings but to most other life on the planet (cockroaches aside perhaps)? How many times do you need to say that “austerity measures” are not merely ideological in design but that they serve no useful purpose other than to wreck economies (as the IMF and World Bank have done in so many other countries across the globe) whilst redistributing wealth from the relatively poor to the mega-rich? How many times does it need pointing out that America is backing al-Qaeda when it suits their ends? – when, after all, al-Qaeda owes its origins to Zbigniew Brzezinski and the CIA and their dirty campaign to overthrow the Soviets in Afghanistan. So it is genuinely painful to have to repeat these things, and totally depressing to be shown to be right – that our collective future really is becoming so absolutely bleak, and unremittingly brutalised. Sooner rather than later, I want to be proved wrong – this hope is the only thing that actually keeps me writing this damned blog.

Now if any of the above sounds to you like craziness, then let me confirm that on one level it really is, though the craziness is not mine. For, in a sense, this is simply the way things have always worked: policies of expedience, of realpolitik. It is how ruling elites prefer to govern the masses, and all that stuff and nonsense about “freedom and democracy” and “saving the planet” is for the proles and “the gentlemen” (as neo-con political philosopher Leo Strauss called them) – those in the higher-up echelons who truly believe in the goodness of the system, but whose real job is to protect the interests of the powers that be. But the difference now is that the ruling elites are ready to assume a more complete dominion over all of their underlings. And it will be achieved by a scientifically-driven programme of social engineering that is already well underway: bringing us into the scientific dictatorship that globalist bigwig Zbigniew Brzezinski famously called “the Technetronic Era”:

“In the Technetronic society the trend seems to be toward aggregating the individual support of millions of unorganized citizens, who are easily within the reach of magnetic and attractive personalities, and effectively exploiting the latest communication techniques to manipulate emotion and control reason.” [..]

“Another threat, less overt but no less basic, confronts liberal democracy. More directly linked to the impact of technology, it involves the gradual appearance of a more controlled and directed society. Such a society would be dominated by an elite whose claim to political power would rest on allegedly superior scientific knowhow. Unhindered by the restraints of traditional liberal values, this elite would not hesitate to achieve its political ends by using the latest modern techniques for influencing public behavior and keeping society under close surveillance and control.” 3

Do Brzezinski’s words represent a warning or a blueprint… this ambiguity remains only because Brzezinski quite deliberately never makes his position clear:

The Technetronic age is that which is created by the (theoretical) Technetronic Revolution. It is always fairly ambiguously presented as to whether Brzezinski is actually predicting this revolution based on observation/trends, or whether he is abstractly philosophizing. It certainly is not a work of political science. With this in mind, his concluding line in the book, ‘In the technetronic era, philosophy and politics will be crucial’ serve to confuse the reader further rather than give some closure. 4

The quote above is taken from a rather favourable review of Brzezinski’s book written by Stephen McGlinchey in 2011. The book itself has been out of print for three decades.

There is plenty of speculation about Brzezinski’s real intent when he wrote the book, but does this even matter – especially as we have good reasons to be suspicious given his record in other more tangible ways – the more important point is that the direction he outlines is evidently the direction our world has taken. And I would like to think that my own ant-sized efforts to halt the progress of this imposed revolution, alongside the efforts of countless other out-spoken ants, all trying so hard to speak up with truth to power is having some effect. That we may be small and struggling to be heard above the largely controlled, mainstream din, with tiny readerships and such small spheres of influence, but that our combining ripples are building in amplitude and spreading wider…. And then I read an article and I think that yes indeed, tiny as we are, we really must be having some effect, because it seems that the government is suddenly intent on shutting voices like mine down altogether.

Never letting any good crisis go to waste, the government it seems has twisted the whole Leveson Inquiry around to its own advantage – in a fashion reminiscent of what happened with the Hutton Inquiry (from which, of course, the BBC has never properly recovered). The Leveson Inquiry, we should remember, was set up to deal with crimes, and specifically the crime of phone hacking, perpetrated by media giants (most prominently Rupert Murdoch’s News International), and to also look into the role played by the London Metropolitan Police, yet in consequence, the results of that inquiry look likely to close down parts of the alternative media instead. Here’s an extract from Tuesday’s Guardian:

Bloggers could face high fines for libel under the new Leveson deal with exemplary damages imposed if they don’t sign up to the new regulator, it was claimed on Tuesday.

Under clause 29 introduced to the crime and courts bill in the Commons on Monday night, the definition of “relevant” bloggers or websites includes any that generate news material where there is an editorial structure giving someone control over publication. […]

Kirsty Hughes, the chief executive of Index on Censorship, which campaigns for press freedom around the world, said it was a “sad day” for British democracy. “This will undoubtedly have a chilling effect on everyday people’s web use,” she said.

She said she feared thousands of websites could fall under the definition of a “relevant publisher” in clause 29.

Hughes said: “Bloggers could find themselves subject to exemplary damages, due to the fact that they were not part of a regulator that was not intended for them in the first place.” 5

Click here to read the full article.

My belief has always been (and remains) that the best way to lose your freedom of speech is by refusing to use it, and so this ludicrous regulatory overreach is more reason to keep offering some small alternative to the mainstream behemoths. And rest assured that I certainly won’t be signing up to any regulatory body.

Finally then, and if the authorities ever do decide to go after me for daring to disagree with mainstream authority, then I ask in advance for your support – why? Because I’m the little guy, the ant, the gnat, the gadfly. The main difference between you and I, in this respect, is merely that I have perhaps put my head a little higher above the parapet. So once I’m firmly in the cross-hairs, assuming this should happen, then you can be absolutely certain it’ll be your turn next, and rather sooner than you might suppose…

1“The Obama administration is drawing up plans to give all U.S. spy agencies full access to a massive database that contains financial data on American citizens and others who bank in the country, according to a Treasury Department document seen by Reuters.

“The proposed plan represents a major step by U.S. intelligence agencies to spot and track down terrorist networks and crime syndicates by bringing together financial databanks, criminal records and military intelligence. The plan, which legal experts say is permissible under U.S. law, is nonetheless likely to trigger intense criticism from privacy advocates.”

From an article entitled “Obama Administration Proposing To Let U.S. Spy Agencies Have Access To Massive Financial Database”, written by Emily Flitter, Stella Dawson and Mark Hosenball, (from Reuters) published by Huffingtonpost. http://www.huffingtonpost.com/2013/03/13/obama-spy-agencies_n_2868389.html

2 From an article entitled “You are all suspects now. What are you going to do about it?” written by John Pilger and posted on his own website on April 26, 2012. http://johnpilger.com/articles/you-are-all-suspects-now-what-are-you-going-to-do-about-it

3 Both quotes taken from Between Two Ages: America’s Role in the Technetronic Era, written by Zbigniew Brzezinski, published in 1970 (although out of print since 1982).

4 Taken from a review of Between Two Ages: America’s Role in the Technetronic Era, written by Stephen McGlinchey and published July 22, 2011. The full review can be found here: http://www.e-ir.info/2011/07/22/review-between-two-ages-america%E2%80%99s-role-in-the-technetronic-era/

5 From an article entitled “Press regulation deal sparks fears of high libel fines for bloggers: Websites could have to pay exemplary damages if they don’t sign up to new regulator, claim opponents of Leveson deal”, written by Lisa O’Carroll, published by the Guardian on March 19, 2013. http://www.guardian.co.uk/media/2013/mar/19/bloggers-libel-fines-press-regulation

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Filed under al-Qaeda & DAESH / ISIS / ISIL, austerity measures, Britain, Cyprus, financial derivatives, internet freedom, John Pilger, mass surveillance, Syria, USA

William Black on the deregulated race to financial ruin

On Saturday [Oct 6th] William K Black, Associate Professor of Law and Economics at the University of Missouri-Kansas City and a former bank regulator, spoke again with Max Keiser on the second half of his tri-weekly Russia Today programme, Keiser Report.

The discussion ranged from how major financial criminals are protected by Deferred Prosecution Agreements under the disastrous tenure of Lanny Breuer as Assistant Attorney General for the Criminal Division of the US Department of Justice, to how, more generally, the City of London became such an important player in the international deregulatory race to the bottom:

Let’s begin with what Black had to say about the UK Financial Services Authority (FSA) and their part in the London Interbank Offered Rate or Libor Scandal [19:30 min into the show]:

Max Keiser: We recently saw the rigging of global interest rate markets Libor. The FSA says they will in the future prosecute bankers involved in rigging Libor. The overwhelming evidence, including all of the emails, suggests this was a prosecutable racket. Why can’t they prosecute the crime that has happened in real time, right now?

William Black: You used the word ‘can’. It has nothing to do with ‘can’. ‘Can’ refers to ability. This is a problem of ‘will’… You can’t create a competition in laxity, which is exactly what the FSA deliberately did. It competed with the Securities and Exchange Commission in the United States [SEC] and the CFTC, the Commodity Futures Trading Commission, and of course Congress, to who can have the absolute weakest regulation.

If you do that, you’re never going to have regulatory leaders with backbone. And you’re never going to have staffers who often have backbone, because why would you go to work for an entity that exists to serve the banks as opposed to serving the people. Good people will leave in those circumstances. And so what you’re seeing is the FSA – and by the way the Bank of England – continue to be the land of the invertebrates. Where if you have any backbone, you’re not allowed.

MK: [referring to the party political conferences] None of the [party] leaders on the local television address the fact that London is a cesspool of regulation – that it won the competition to have the least biting regulatory framework and that’s why the global economy and financial markets are in such disarray…. How are we going to rectify this, what do you suggest?

WB: Well, first let’s think out that if you have a competition in laxity, everybody loses. Everybody ends up with crappy regulation, and that’s exactly what happened throughout the Eurozone and in the United States. The only way to win a competition in laxity is not to engage in the competition.

Let me give you two specific examples, from a conference I was at just last week in Baltimore. Brooksley Born, one of the heroes who issued the famous warning about Credit Default Swaps, and got swashed by that bi-partisan coalition of the Clinton administration and Alan Greenspan, and Phil Gramm said that as soon as the FSA got created, then leaders – senior leadership of the FSA – began coming to the United States to industry conferences, and saying you should leave America and do your deals and relocate in the City of London, because we will give you weaker regulation.

And then a guy who had been with the Securities and Exchange Commission for many, many years said that’s exactly what happened on Initial Public Offerings, IPOs. That the City of London officials began coming to the United States, to the trade meetings, and saying do your IPOs in the City of London instead of Wall Street because we will look the other way while you do this.

And so I’d only make one minor thing about your point. Of course the Labour Party on finance issues is not a party that is remotely of the left. It is a party of what would be, in US terms, ‘the extreme right’. The Lib-Dems were every bit as bad, and the Conservatives, if anything, are worse. And so there has been no choice in the United Kingdom for over a decade, if you actually wanted to vote for someone who’s really going to regulate. So that’s what you have to change. And one of the British parties has to be changed into a party that represents the people… instead of representing the huge financial institutions.

Because you’ve just seen what happens to a nation that wins a competition in laxity; it loses its moral soul and it has repeated financial crises, because what it will attract is the worst pond scum throughout the world, and it will have regulatory leaders who will stand by while the pond scum destroy the nation.

In the first half of the same interview, Keiser asks Black to talk more specifically about Lanny Breuer, the head of the Criminal Division of the US Department of Justice, “caught boasting of his love for Deferred Prosecution Agreements”.

In fact, William Black had already written an extended article tackling the same subject back on September 17th. Entitled “Fiat Justitia? Breuer fires blanks on elite financial frauds”, Black’s piece entertainingly summed up Breuer’s recipe for disaster as follows:

Beurre blanc is the classic white butter sauce of France. Americans who hate the French claim that they became adept at saucing to cover up the rot in their meat in earlier times. A beurre blanc does not remove the rot. It masks the bad taste and the bad color of bad meat. Indeed, the sauce makes the dish even less healthy. If the rotten meat doesn’t get you, the sauce’s cholesterol will.

“Breuer blanc” is the classic white butter sauce served by the increasingly oxymoronic Justice Department to cover up the rot in elite American banksters. Lanny Breuer runs the Criminal Division during the continuing cover up of the greatest and most destructive epidemic of elite white-collar crime in our history. The ingredients of “Breuer blanc” consist of a generous portion of inaction and a large dollop of hypocrisy all emulsified with esters of excuse.

Black then goes on to explain how all of the last three US administrations, each having been bought off by huge political contributions, have been equally irresponsible in allowing “elite financial firms and their senior officers to commit fraud with near impunity”:

It was a travesty and a national tragedy that [Attorney General, Eric] Holder and Breuer (and their predecessors) have failed to do their duty to hold the banksters accountable. It is beyond comprehension that Breuer is bragging about his failure to prosecute elite corporate frauds. […]

The reality is that prosecutions of financial fraud fell dramatically under Bush and declined further under Obama. Breuer has not indicted a single elite Wall Street bankster whose frauds drove the crisis. I have been unable to find evidence that he has even conducted grand jury investigations of the elite banksters who drove the crisis. (Grand juries are secret, but they generally become public because the witnesses can disclose their existence.) Even if a few grand jury investigations of the Wall Street banksters have occurred, there cannot have been more than a handful of investigations worthy of the name. I know of none, and that includes Countrywide, WaMu, IndyMac, Lehman, Merrill Lynch, Goldman, the huge mortgage banks, and Citicorp.

And when it comes to the use of Deferred Prosecution Agreements [DFAs], Black begins by quoting what Breuer himself described as “the focus” of a speech he made on September 13th to an audience of New York attorneys, before then adding his own response:

“Tonight, I want to focus on one aspect of our white collar criminal enforcement in particular: the use of deferred prosecution agreements, or DPAs. Over the past three-and-a-half years, the Department of Justice has entered into dozens of DPAs, and non-prosecution agreements, or NPAs. I’ve heard people criticize them and I’ve heard people praise them. What I’m here to tell you, is that, along with the other tools we have, DPAs have had a truly transformative effect on particular companies and, more generally, on corporate culture across the globe.”

You will find the statement at 7:37 min into this youtube clip of Breuer’s speech:

Click here to read a very tidy official transcript of Lanny Breuer’s speech posted on the US Department of Justice website.

William Black’s response:

Breuer’s claim is preposterous. Here are key facts that show he is serving us tripe. First, he is correct that we have just run an experiment for over a decade – we no longer typically prosecute elite U.S. corporations that commit felonies. We have dramatically reduced financial fraud prosecutions and in the cases where the Criminal Division still troubles a felonious corporation it typically negotiates a DPA, or more pathetic still, a NPA. A DPA rarely leads to a prosecution of the corporation, so it too is really an agreement not to prosecute. DPAs and NPAs are primarily used for non-elite corporations, so when Breuer claims “dozens of DPAs” one should not assume that his Criminal Division is taking on vigorously fraudulent elite corporations, particularly elite U.S. corporations that commit felonies.

Far from proving that DPAs caused a “sea change in corporate compliance,” a December 2009 GAO study found that the Justice Department did not collect data on DPAs until 2009, had no performance measures for “corporate compliance,” and had no reliable information on purported improvements in corporate compliance.

William Black concludes the article as follows:

Breuer is a lawyer, not an economist. A lawyer should know better. We have known for millennia that the way to provide justice is to follow the maxim: Fiat Justitia; Ruat Caelum (let justice be done, though the heavens fall). The maxim may sound impractical, but long experience has demonstrated that the best way to prevent the heavens from falling is to always provide justice and ignore the claims that the elites should be given special favors lest the heavens fall. Breuer, Holder, and Obama are all lawyers who were taught that the temptation to create a special, favorable set of rules for the elites is not simply unjust but also the surest means of destroying a democracy, an economy, and a society. Politics, of course, teaches the opposite lesson and Breuer, Holder, and Obama became politicians a long time ago. Politics is raw, serving up crudités variées. Breuer’s speech coaching defense counsel on how to provide him with the excuse to avoid prosecuting elite corporate felons was crude and unworthy of any representative of the Department of Justice.

Click here to read William Black’s complete article.

And here’s what William Black said to Max Keiser [13:40 min]:

I was appalled. I, you know, used to help the prosecutions during the savings and loan [crisis] days. And I was a Justice Department lawyer, as was my wife. And Lanny Breuer set out a roadmap on how people could avoid getting prosecuted their elite white-collar criminal banks that caused the financial crisis. And the way he said to do it is hire yourself an economist and be really ‘too big to fail’ and claim that a lot of innocent workers are going to lose their jobs if you take any prosecution against my criminal bank. You know, in other words you hold the workers hostage. […]

Well, the deferred prosecution means non-prosecution, and everybody knows it means non-prosecution. And the one exception proved the rule. Arthur Andersen was offered a third Deferred Prosecution Agreement and refused it, and went to trial and lost… and so you know there’s no more Arthur Andersen. But the lesson the justice Department learned from all of that is: Oh my God, we can’t actually prosecute anybody large, and so they essentially don’t prosecute large organisations anymore. […]

This is all about removing the deterrents. This is all about allowing people to commit the crimes with absolute impunity. And this was more than a wink-wink, nod-nod… This is how you give me the excuse not to prosecute. And it was wonderful! Breuer said: Now I want to warn you, this approach won’t always work…

Not always – just all of the time…!

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Filed under Britain, Max Keiser, USA

William Black on how our financial system became a Ponzi scheme

William Black, Associate Professor of Economics and Law at the University of Missouri-Kansas City, is a former financial regulator and a white-collar criminologist, who helped to expose Congressional corruption during the Savings and Loan Crisis in the late 1980s, by accusing then-house speaker Jim Wright and five US Senators, subsequently known as the Keating Five (who included John Glenn and John McCain), of doing favors for the S&L’s in exchange for contributions and other kickbacks. Although the senators only received a slap on the wrist, Charles Keating — after whom the so-called “Keating Five” were named — had sent a memo that read, in part, “get Black — kill him dead.”

Based on his experiences, Black wrote a book entitled: “The Best Way to Rob a Bank is to Own One.

In April 2009, William Black was interviewed by Bill Moyers on PBS. He explained how the banks and the credit ratings agencies were together committing fraud, with the result that the financial system “became a Ponzi scheme”:

BILL MOYERS: So if your assumption is correct, your evidence is sound, the bank, the lending company, created a fraud. And the ratings agency that is supposed to test the value of these assets knowingly entered into the fraud. Both parties are committing fraud by intention.

WILLIAM K. BLACK: Right, and the investment banker that — we call it pooling — puts together these bad mortgages, these liars’ loans, and creates the toxic waste of these derivatives. All of them do that. And then they sell it to the world and the world just thinks because it has a triple-A rating it must actually be safe. Well, instead, there are 60 and 80 percent losses on these things, because of course they, in reality, are toxic waste.

BILL MOYERS: You’re describing what Bernie Madoff did to a limited number of people. But you’re saying it’s systemic, a systemic Ponzi scheme.

WILLIAM K. BLACK: Oh, Bernie was a piker. He doesn’t even get into the front ranks of a Ponzi scheme…

BILL MOYERS: But you’re saying our system became a Ponzi scheme.

WILLIAM K. BLACK: Our system…

BILL MOYERS: Our financial system…

WILLIAM K. BLACK: Became a Ponzi scheme. Everybody was buying a pig in the poke. But they were buying a pig in the poke with a pretty pink ribbon, and the pink ribbon said, “Triple-A.”

He also pointed out that the policies of Obama administration remained in violation of the law:

BILL MOYERS: Yeah. Are you saying that Timothy Geithner, the Secretary of the Treasury, and others in the administration, with the banks, are engaged in a cover up to keep us from knowing what went wrong?

WILLIAM K. BLACK: Absolutely.

BILL MOYERS: You are.

WILLIAM K. BLACK: Absolutely, because they are scared to death. All right? They’re scared to death of a collapse. They’re afraid that if they admit the truth, that many of the large banks are insolvent. They think Americans are a bunch of cowards, and that we’ll run screaming to the exits. And we won’t rely on deposit insurance. And, by the way, you can rely on deposit insurance. And it’s foolishness. All right? Now, it may be worse than that. You can impute more cynical motives. But I think they are sincerely just panicked about, “We just can’t let the big banks fail.” That’s wrong.

Click here to read a complete transcript of the interview.

Two and a half years on, William Black says on Democracy Now! that nothing has changed:

AMY GOODMAN: What do you think has to happen now? And what does this have to do with the Occupy Wall Street protests that have expanded here in Kansas City and across the globe? There are more than a thousand demonstrations that have been held in the last weeks.

WILLIAM BLACK: Well, we have companion problems. We’ve got to stop this dynamic that’s producing recurrent, intensifying crises. I mean, this one has devastated the nation. The next one would probably be equivalent to the Great Depression. And part of that answer—but only part of it—is to hold the folks accountable, especially the most elite, who caused this crisis. And they did it through fraud, and they did it through fraud in what we call the “C-suites” —the CEOs, the COOs — so, the absolute top.

AMY GOODMAN: And how would these powerful financial entities be held accountable? What exactly should happen?

WILLIAM BLACK: It all starts with the regulators, which is why it’s all not started here, because we have, of course, the wrecking crew, Bush’s wrecking crew, what Tom Frank called them, in charge, and they stopped making criminal referrals. So our agency, in the savings and loan crisis, made over 10,000 criminal referrals to the FBI. That same agency, in this crisis, made zero criminal referrals. If you don’t get people pointing the way and pointing to the top of the organization, you don’t get effective prosecutions. So, in the peak of the savings and loan crisis, we had a thousand FBI agents. This crisis has losses 70 times larger than the savings and loan crisis. And the savings and loan crisis, when it happened, was considered the largest financial scandal in U.S. history. So we’re now 70 times worse. And as recently as 2007, we had 120 FBI agents—one-eighth as many FBI agents for a crisis 70 times larger. And they looked not at the big folks, but almost exclusively at the little folks.

AMY GOODMAN: William Black, you mentioned Bush’s wrecking crew, but we live in the time of President Obama.

WILLIAM BLACK: And we’ve been living for some years in the time of President Obama, and he has done absolutely nothing to reestablish the criminal referral process. And as a result, there are virtually no prosecutions of any elites.

He was also asked about what the message from Occupy Wall Street should be:

Well, first, of course, I don’t speak for that movement, and indeed they don’t have official spokespersons with clear plans. So that part is true. They think of that as one of the great strengths of democracy now, right? That things bubble up, and they have different ideas. However, if you look, not just nationwide, but worldwide, you will see some pretty consistent themes developing.

And those themes include: we have to deal with the systemically dangerous institutions, the 20 biggest banks that the administration is saying are ticking time bombs, that as soon as one of them fails, we go back into a global crisis. Well, we should fix that. Right? There’s no reason to have institutions that large. That’s a theme.

That accountability is a theme, that we should keep—put these felons in prison, and there’s no action on that.

That we should get jobs now, and that we should deal with the foreclosure crisis. So those are four very common themes that you can see in virtually any of these protest sites. And they have asked me, for example, to come to New York to talk about some of these things. So, I think, over time, you won’t necessarily have some grand written agenda, but you’ll have, as I say, increasing consensus. And it’s a very broad consensus. It’s not left, it’s not right; it’s not Republican, it’s not Democrat.

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