Jaw-Dropping Crimes of the Big Banks

http://farm8.staticflickr.com/7124/7534252614_dc24534f4a_b.jpgImage by William Banzai

Preface: Not all banks are criminal enterprises. The wrongdoing of a particular bank cannot be attributed to other banks without proof. But – as documented below – many of the biggest banks have engaged in unimaginably bad behavior.

You Won’t Believe What They’ve Done …

Here are just some of the improprieties by big banks:

  • Engaging in mafia-style big-rigging fraud against local governments. See this, this and this
  • Shaving money off of virtually every pension transaction they handled over the course of decades, stealing collectively billions of dollars from pensions worldwide. Details here, here, here, here, here, here, here, here, here, here, here and here
  • Pledging the same mortgage multiple times to different buyers. See this, this, this, this and this. This would be like selling your car, and collecting money from 10 different buyers for the same car
  • Committing massive fraud in an $800 trillion dollar market which effects everything from mortgages, student loans, small business loans and city financing
  • Pushing investments which they knew were terrible, and then betting against the same investments to make money for themselves. See this, this, this, this and this
  • Engaging in unlawful “Wash Trades” to manipulate asset prices. See this, this and this
  • Participating in various Ponzi schemes. See this, this and this
  • Bribing and bullying ratings agencies to inflate ratings on their risky investments

The executives of the big banks invariably pretend that the hanky-panky was only committed by a couple of low-level rogue employees. But studies show that most of the fraud is committed by management.

Indeed, one of the world’s top fraud experts – professor of law and economics, and former senior S&L regulator Bill Black – says that most financial fraud is “control fraud”, where the people who own the banks are the ones who implement systemic fraud. See this, this and this.

Even the bank with the reputation as being the “best managed bank” in the U.S., JP Morgan, has engaged in massive fraud. For example, the Senate’s Permanent Subcommittee on Investigations released a report today quoting an examiner at the Office of Comptroller of the Currency – JPMorgan’s regulator – saying he felt the bank had “lied to” and “deceived” the agency over the question of whether the bank had mismarked its books to hide the extent of losses. And Joshua Rosner – noted bond analyst, and Managing Director at independent research consultancy Graham Fisher & Co – notes that JP Morgan had many similar anti money laundering laws violations as HSBC, failed to segregate accounts a la MF Global, and paid almost 12% of its 2009-12 net income on regulatory and legal settlements.

But at least the big banks do good things for society, like loaning money to Main Street, right?


  • The big banks have slashed lending since they were bailed out by taxpayers … while smaller banks have increased lending. See this, this and this

We can almost understand why Thomas Jefferson warned:

And I sincerely believe, with you, that banking establishments are more dangerous than standing armies ….

John Adams said:

Banks have done more injury to religion, morality, tranquillity, prosperity, and even wealth of the nation than they have done or ever will do good.

And Lord Acton argued:

The issue which has swept down the centuries and which will have to be fought sooner or later is the people versus the banks.

No wonder a stunning list of prominent economists, financial experts and bankers say we need to break up the big banks.

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  • ShankyS

    I guess that about sums it all up.

  • DaveSmith

    Why do you suppose you will never ever see such as this, printed/aired in the corporate news ?

  • Excellent article I love all the documentation. I’ll be
    re-blogging this in the AM. And this is what it’s all about big corporate banks
    which make policy in essence for the world. To the fellow commenter, look into
    the Bank of International Settlements.

  • Excellent article I love all the documentation. I’ll be
    re-blogging this in the AM. And this is what it’s all about big corporate banks
    which make policy in essence for the world. To the fellow commenter, look into
    the Bank of International Settlements.

  • hvaiallverden

    “Why of course the people don’t want war. Why should some poor slob on a
    farm want to risk his life in a war when the best he can get out of it
    is to come back to his farm in one piece? Naturally the common people
    don’t want war neither in Russia, nor in England, nor for that matter in
    Germany. That is understood. But, after all, it is the leaders of the
    country who determine the policy and it is always a simple matter to
    drag the people along, whether it is a democracy, or a fascist
    dictatorship, or a parliament, or a communist dictatorship.

    or no voice, the people can always be brought to the bidding of the
    leaders. That is easy. All you have to do is tell them they are being
    attacked, and denounce the peacemakers for lack of patriotism and
    exposing the country to danger. It works the same in any country.”

    Herman Göhring

  • We don’t need bandits like this in charge of important institutions.
    Senior managers & directors should go to jail when committing a crime, not having their bank (or worse: insurance company) pay the fines.
    It’s people who make decisions, not corporations.

  • nveric

    Seems all here are happy with the status quo.

    Let me know when the talking ends.

  • We need to do more than get rid of the big bankers! We NEED TO CLEAN HOUSE with all of them!


  • olde reb

    Would you believe the FRBNY might hide $4 billion from the government daily from the auction accounts of Treasury securities ? Ref. Federal Reserve Heist, http://www.scribd.com/doc/101937790 .
    Hiding money from the government is called embezzlement.

  • Mark Weisberger

    Thanks for putting this all in one place.

    Does HSBC win a prize for being mentioned the most in these articles?