The Biggest Financial Scam In World History

Why Is the Libor Scandal So Important to You?

There have been numerous big banking scandals recently.

But the Libor scandal is the biggest financial scam in world history. See this, this and this.

The former CEO of Barclays said today that banks across the world were fixing interest rates in the run-up to the financial crisis .

MIT finance professor Andrew Lo notes:

This dwarfs by orders of magnitude any financial scams in the history of markets.

Professor of economics and law Bill Black points out:

It is the largest rigging of prices in the history of the world by many orders of magnitude.

Indeed, the scandal effects an $800 trillion dollar market – 10 times the size of the real world economy.

Matt Taibbi explains that this is the “mega scandal of all mega scandals”, because Libor is the “sun at the center of the financial universe”, and manipulating Libor means that “the whole Earth is built on quicksand.”

Local governments, credit card holders, students, small businesses, small investors, homeowners and virtually everyone else in the entire world has been impacted by the manipulation.

Credit card debt – almost a trillion dollar market – is pegged to Libor. So are student loans – a trillion dollar market.

Mortgages are a bigger market: around $10 trillion dollars in the U.S. The Washington Post notes today:

60 percent of prime adjustable rate mortgages, and nearly 100 percent of subprime ones, were indexed to LIBOR.

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That means that when LIBOR rises, so do the prices ordinary consumers pay to, say, get a mortgage.

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So how did the manipulations by Barclay’s affect this rate? First, from 2005 and 2007, the bank allegedly varied the rates it reported to the BBA and Thomson Reuters so as to improve its margins on internal trades. For example, it could have placed bets that the LIBOR rate would increase, and then reported artificially high rates which in turn artificially increased the LIBOR averages, so that the bets were likelier to pay off. This … bumped up mortgage rates however infinitesimally for consumers even when the risk of the loans hadn’t changed at all.

Other loans – like small business loans – are usually based on Libor as well.

But that is all small potatoes compared to the $350 trillion in swaps tied to Libor. Virtually every single local government in the United States has been scalped by Libor manipulation.

The big banks have robbed the whole world.

Indeed, the scandal is so big that it will further destroy trust in our financial system and drive many people from investing in the capital markets altogether.

Update: One of the leading independent analysts of the US banking and financial system, Chris Whalen, confirms:

George Washington [our pen name here Washington's Blog] is right when he calls the LIBOR scandal “The Biggest Financial Scam In World History” ….

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  • Ron 535 watcher from Iowa

    Yes and no one will be prosecuted I’ll bet!

    • jo6pac

      But I wanted to say that;) Sad but true only Main Streeters go to jail not the banksters.

    • http://roycobden.wordpress.com Roy Cobden

      Correct Ron!

      It would be FAR too disruptive to the financial system if anyone were prosecuted!

      Perhaps a token fine or two? In return, of course, for dropping any further or future investigation into the matter.

    • Suspending Disbelief

      Those days are coming to an end…….soon we’ll see corrupt heads rolling, believe it! This is the straw that will break the camel’s back. Once the details and effect of this are disseminated to the common man the “great purge of 2012″ will officially begin and we can begin rebuilding a better global civilization (until it happens again at some point in the future).

  • gozounlimited

    And it comes down to the American people…waking up now would be a very good idea if one desires to (in any organized and sane way), compensate for self …. and stop digging a deeper hole. In reality where and how we land is in our power…. [first we must acknowledge our mistake in order to make a change.] And when you come down to it ….. the criminal at the head of the rot must first be identified before amputation commences. We have no choice but to let the new balance that 2012 provides to overtake us, enlighten us, and improve us. But first we have to wake up…..and make that change.

    Man In The Mirror ….. video: http://www.youtube.com/watch?v=F9Nh84lfvW0

  • Snowy Smith, South Africa

    The “IRON MOUNTAIN REPORT” was and still is 100% CORRECT.
    These Banking SCUM must be taken down.

  • ARCHANGEL

    I told you America, take back your country now!!!! You have been step on for years by government and big corporations tied to the cabal and illumanati.
    Listen to DRAKE on 2012 blog talk radio and find out what is really happening regarding your freedom.
    Your not in Kansas anymore!!!!

  • Green Hornet

    This is not just the banksters, it is as much the politicians as well. After all this libor could not be manipulated without the laws being bastardized first to allow them the do this. The banksters bought our polticians and paid them to bastardize the laws. The politicinas knew it was wrong, and new the money was dirty, but they did it just the same for the dirty filthy money.
    Watch CBS News get ‘Jacked’ on ’60 Minutes’
    Jack Abramoff, onetime power broker for the elite of Washington, D.C., astonished the nation when he exposed corruption on Capitol Hill on CBS’ Lesley Stahl’s “60 Minutes” just months ago – and now viewers will have a second opportunity to watch that mind-blowing interview July 8.
    “People are under the impression that the corruption only involves somebody handing over a check and getting that favor, and that’s not the case,” Abramoff told Stahl. “The bribery, call it, because ultimately that’s what it is, that’s what the whole [lobbying] system is … it is done every day, and it is still being done.
    Face it we have elected arsonists to be our firemen and they were paid to burn the house down with us inside. Each time we started to say “I smell smoke!” The arsonists would say we have it under contril there is nothing to wory about. All the time they were laughing at us all the way to the bank.
    The problem is not the Democrats “or” the Republicans. The problem is the Democrats “AND” the Republicans. America was 50% of the world economy, with the greatest economic engine in the history of mankind. Now look at were we are now. Who was in DC making the laws? The Democrats and the Republicans.
    They are dinosaurs and it is far past tome for them to go extint. The sad fact is if we elected the biggest local crook, they couldn’t steal 10% of what our elected officials do every day.
    AMERICA WAKE UP AND NEVER NOTE FOR ANY DEMOCRAT OR REPUBLICAN EVER AGAIN!! LOOK AT HOW THEY SCREWED US ALL, AND KNOW ANY VOTE FOR THEM IS A VOTE TO GET SCREWED SOME MORE.

    “The truth is there are very few members [of Congress] who I could even name or could think of who didn’t at some level participate in that,” he said.

  • Pat

    Hornet, I appreciate your sentiments, but the fact is, the bankers have, over the centuries, gotten virtually every politician into their control. Think about it, they figured out how to legally make money out of thin air; AND, they’re greedy beyond belief; so the inconceivably vast fortunes they’ve built up are enough to wield virtually total control over every aspect of society – business, politics, education, healthcare aka deathmarch, media, entertainment, science, religion EVERYTHING.

    Family Rothschild in particular, starting in the late middle ages, crafted this most gigantic of scams by being EXTREMELY crafty. Nowadays, they can even TELL the public they’re printing money out of nothing, and everyone’s become so hypnotized they don’t even blink. But back then, if people knew the loans they were getting and having to pay back with hard-earned money were nothing more than receipts backed by NOTHING, they’d have strung up a few dishonest goldsmiths. So secrecy was extremely important, and the Rothschilds perfected this, manipulating situations so that any blame was placed not on them, but on the politicians whom they largely controlled. This has never changed. The politicians do what the banksters tell them, period end of story. And the banksters see to it that ALMOST all politicians are stupid or dishonest enough to not put up a fight.

  • kevin

    the people who control the banks especially the central banks are the ones who should be in the dock along with politicians who allowed this to happen,by the way where is all this money and why if it is proceeds from crime cant the government demand it all back including all other assetts,I believe criminals are not allowed to profit from crime

  • http://www.oneillquigley.eu Michael O’Neill

    All those guns in your houses, you Americans, and you still won’t stand up to your politicians. Your mindset so messed up, you want to BE them. You cannot see how this enslaves you!

    • Jack

      Precisely what I have been thinking since 2008.

      Not a single “bad guy” shot. The 99%’ers whine, moan and groan and nothing else. Do they expect the crooks to stop? Do they expect a “different result”?

      I don’t understand.

  • http://www.oneillquigley.eu Michael O’Neill

    Mind you, we’re hardly paragons of sense in Ireland when ti comes to Banks OR Politicians! :rollseyes:

  • Joanna

    the whole banking system has become a big fraud

  • Greg

    TOO many lack comprehension for the magnitude of the “problem”. No real fix is possible. A political “adjustment” is best that can be hoped for. Who pays for political adjustments? No, not those with the gold.

  • Patriotted001

    A trillion or two? Big deal. Obozo is spending $1.5T more than he takes in every year. No biggie. He’s got it all under control. Pay no attention to that man behind the curtain. The Wizard of Obozo has spoken!

  • BYee

    So, is it going to be another one of these scandals where the issue is exposed and we all know and can prove we have been ripped off, but can do nothing about it? I had student loans and a mortgage during this time which were tied to the Libor rate. What can I do? If they are not legal, do we have to pay? They will potentially get a “slap” on the hand and walk away after the scandal mellows out. What of all of us that were cheated?

    Thank you.

  • ryan

    Our world is so messed up that good people coming from poor economic and social circumstances spend their life behind bars because they found themselves at the wrong place at the wrong time while money hungry and power obsessed vampires who created the social conditions in the first place can do whatever they wish from starting wars to avoiding tax to enslaving the world and the list goes on. It is time for the US public to say enough is enough. Don’t support the system. Don’t vote for pinoccio and mickey mouse. Demand to end the fed. Demand to bring back the gold standard. Demand a restructure of the social, political and economic system as outlined in the constitution and the vision of the founding fathers. For the sake of our children it is time to stand up against these vampires. Ryan

  • Grandpa

    Obviously the time has come to wipe the slate clean and start over again, as Germany did in 1948.
    It is time for the forgiveness of all debt, public and private.

  • DAVID REA

    PRIVATE BANKING WHISTLEBLOWERS

    PRESS RELEASE #3

    From: David Rea and Antonius Richard de Caluwe Hemelrijk

    DATE: OCTOBER 22, 2012

    THE MEGA- CRIMINAL CONSPIRACY THAT WE ARE REVEALING TO YOU IS VERY SOPHISTICATED INVOLVING INTERNATIONAL PRIVATE BANKING FRAUD, ASSET HIDING, MONEY LAUNDERING, TAX EVASION + THE EUROCLEAR INTERBANK SCREEN. THE CONSPIRATORS ARE NICHOLAS BURGOYNE + ROGUE BANKERS.

    The below email was sent to Detective Chief Superintendent Steve Head who is the Head of Economic Crime Directorate, City of London Police, on October 4, 5, 9, 12, 15 and 20. As of today, he has not replied to us. Why won’t the City of London Police reply to our allegations and launch a formal investigation? Who are parties behind this fraudulent conspiracy that have the power to neutralize the regulatory + law enforcement authorities?

    Strategic Management Board – Detective Chief Superintendent Steve Head

    Role
    Detective Chief Superintendent Steve Head is the Head of Economic Crime directorate and as such has responsibility for the investigation of serious and organized economic crimes across the City of London, as well as for “Lead-Force” investigations across England and Wales.
    DCS Head also leads on police investigations of Overseas Corruption and Bribery involving British citizens and companies abroad. Additionally he has responsibility for the Force’s Hostage and Crisis-Management Negotiator cadre and for the Force’s Emergency Temporary Mortuary response.

    From: DAVID REA (skype: damarrealestate)
    Date: Thu, Oct 4, 2012 at 10:45 AM
    Subject: FRAUD COMMITTED BY NICHOLAS BURGOYNE + PETER WALTON
    To: steve.head@cityoflondon.police.uk
    Cc: Mr. de Caluwe, Mr. Mundell, Mr. Kalpoe

    CITY OF LONDON POLICE
    Detective Chief Superintendent Steve Head is the Head of Economic Crime directorate
    Telephone: 020 7601 2222 PO Box 36451 London EC2M 4WN

    Dear Chief Superintendent Steve Head:

    We would like to make a formal complaint of fraud against Mr. Nicholas Burgoyne + Mr. Peter Walton with your department.

    >>On April 12, 2012, Mr. Nicholas Burgoyne signed the attached NCND which includes his contact details + UK passport:
    1) NCND EIG EUROLINK INVESTMENT GROUP (NB).pdf 1397K
    Recently, Mr. Burgoyne + his family secretly vacated the home address listed in this NCND + relocated to an unknown address in the UK.
    We have had his passport reviewed + there appear to be anomalies with it.

    >>On May 30, 2012, Mr. Nicholas Burgoyne fraudulently induced the payment of 25,000 euros by sending Mr. Mundell this Agreement:
    1) MUNDELL – BURGOYNE agreement.pdf (application/pdf) 79K

    >>On May 31, 2012, Mr. Mundell sent 25,000 euros to Mr. Burgoyne’s RBS bank Account Number GB55 RBOS 1600 0710 1946 02:
    1) MUNDEL WIRE TO NB.pdf (application/pdf) 184K

    >>On June 8, 2012, Mr. Nicholas Burgoyne fraudulent induced the payment of 25,000 euros by sending Mr. Kalpoe this Agreement:
    1) KALPOE – BURGOYNE agreement.pdf (application/pdf) 288K

    >>On June 15, 2012, Mr. Burgoyne forwarded this email to us sent to him by Mr. Peter Walton (HEAD OF TRADE FINANCE at RBS):
    1) (DAVID CHEEVER) PETER WALTON RBS JUNE 15, 2012 EMAIL TO NICHOLAS BURGOYNE.docx (application/vnd.openxmlformats-officedocument.wordprocessingml.document) 17K

    This June 15, 2012 email shows:
    a) 24,590 euros of Mr. Mundell 25,000 euros being credited to Mr. Burgoyne’s RBS bank Account Number GB55 RBOS 1600 0710 1946 02. The remaining 410 euros is not accounted for anywhere.
    b) Mr. Peter Walton opened sub-accounts for us at RBS (David Rea, Mr. de Caluwe) but these sub-accounts have been closed without our authorization.
    c) The monies Mr. Walton was to send to us never arrived (25M euros = Mr. Mundell, 6M USD euros = Mr. Rea, 1M USD = Mr. de Caluwe).
    d) The remaining monies in our RBS sub-accounts have disappeared without our authorization. Repeated requests for the accounting of these monies have been ignored.

    >>On June 18 + June 19, 2012, Mr. Kalpoe sent 25,000 euros to Mr. Burgoyne’s RBS bank Account Number GB55 RBOS 1600 0710 1946 02.

    >>On June 20, 2012, Mr. Nicholas Burgoyne gave us the attached fraudulent bank documents:
    1) Anthony MT103.pdf (application/pdf) 85K
    2) David MT103.pdf (application/pdf) 93K
    3) RBS POF de Caluwe.pdf (application/pdf) 29K
    4) RBS POF Mundell.pdf (application/pdf) 31K
    These are clearly documented fraudulent activities by Mr. Burgoyne + Mr. Walton that have financially harmed us + we request your formal investigation into these activities.

    Sincerely,
    David Rea
    Mr.de Caluwe
    Mr. Mundell
    Mr. Kalpoe

    9 attachments — Download all attachments
    Anthony MT103.pdf
    85K View Download
    David MT103.pdf
    93K View Download
    RBS POF Antonius.pdf
    29K View Download
    RBS Mr. Mundell .pdf
    31K View Download
    NCND EIG EUROLINK INVESTMENT GROUP (NB).pdf
    1397K View Download
    MUNDELL – BURGOYNE agreement.pdf
    79K View Download
    KALPOE – BURGOYNE agreement.pdf
    288K View Download
    Mr. MUNDEL WIRE TO NB.pdf
    184K View Download
    (DAVID CHEEVER) PETER WALTON RBS JUNE 15, 2012 EMAIL TO NICHOLAS BURGOYNE.docx
    17K View Download

    • DisqusIsBrokenAgain

      Why on earth would you EMAIL such an important document? Seems odd to me, something of such importance should be sent special delivery.

 

 

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