Sunday, December 21, 2014

Guess Who Really Pays Big Bank Fines?

Nothing the Obama Justice Department does surprises me so I guess I shouldn't be surprised to learn this little factoid over at Jonathan Turley's blog. The Obama Justice Department has yet to prosecute a single one of the bank fraudsters who ripped off the American people and got rewarded handsomely in doing so during the 2008 financial meltdown from which average American have still not recovered from declining incomes and net worth. According to Lawrence Rafferty, buried deep in the settlement agreements the Justice Department reaches with banks is a provision allowing them to take a corporate tax deduction for the fines they agree to pay for breaking the law. In other words, the American taxpayer is actually footing the bill indirectly to pay for large bank fines that help fund a nifty slush fund the Justice Department operates.
. . . Under Attorney General Eric Holder, whose agency has not prosecuted a single major bank or executive in the aftermath of the 2008 meltdown, the Justice Department has been criticized, not least by Democrats, for believing banks are too big to fail and their top brass too big to jail. But here’s the twist. It turns out that banks are also too big to tax: Windfall tax deductions set against the civil settlements imposed by the Justice Department total more than $44 billion, according to Newsweek estimates.”
It may also be quite shocking to learn that the reason that the Big Banks agree to the large settlements is that they know that a large percentage of the fines are tax-deductible. Would it surprise you to learn that even the Justice Department can gain from these large multi-billion dollar “settlements”?
“But there’s another, more self-serving reason for the Justice Department to hike civil settlement payments while allowing for most of the sum to be tax-deductible. The agency receives a cut of up to 3 percent of its share of the total settlements for its Working Capital Fund, a slush fund common across major government agencies . . . 
When the Banksters and financial companies are allowed to “pay” civil fines and penalties that can be deducted from their corporate taxes, just how is this process providing any incentive for the banks to stop breaking the law? Since the Justice Department itself can profit from the settlement designed to allow for the deduction of these fines, where is the incentive for the Justice Department to actually prosecute these Banksters on criminal charges? . . . 
According to Rafferty, the SEC has disallowed "guilty" financial companies from taking tax deductions for the fines they're ordered to pay since 2003. On a brighter note, Rafferty says legislation has been introduced in Congress called "Truth in Settlements," which would require the Justice Department to disclose hidden tax deductions in settlement agreements. The House Committee on Oversight and Reform has asked the Justice Department to explain why civil settlements have been reached with every single bank found to have broken the law instead of bringing criminal charges against the guilty parties, like it does with ordinary Americans who lack the political clout of the banking industry.


Anonymous said...

Seriously, Iran Contra, Savings and Loan Debacle under Bush Boys, Kuwait, 9/11 (Israel, Saudi and US) and more for since the beginning of time. Big America doesn't change unless there is a class action vote or suit. Ponder that. The DOJ and integrity Division under Obama has prosecuted more folk than past Presidents. Changed laws and has Warren.

Flogger said...

Back in March 2013 it was reported: Responding to questioning from Republican Senator Chuck Grassley, who noted that there had been no major prosecutions of financial institutions or executives by the Obama administration, Holder said: “I am concerned that the size of some of these institutions becomes so large that it does become difficult for us to prosecute them, when we are hit with indications that if we do prosecute—if we do bring a criminal charge—it will have a negative impact on the national economy, perhaps even the world economy…”

Unlike the seemingly never ending investigation of Benghazi there is no similar efort about the Corruption on Wall Street.

Martha Stewart was prosecuted, as high profile case. She was meaningless in comparison to the damage Big Financial Institutions did to the USA and the World.

Bernie Madoff was slammed hard because his clients were 1%.

Anonymous said...

Anon 11:15 needs to get off the
pipe. Liberals can never see the splintered log embedded in their own skin.

No party is more owned by Wall Street and the transnational corporations than the Democrat Party. Which party was it that championed and pushed through NAFTA ["...but, but, but it was bipartisan!!" is their cover) which resulted in the oft-mocked "giant sucking sound" of good paying American factory jobs to low pay Mexico and Asia and Vietnam??? (Alex, I'll take Bill Clinton crimes against USA workers for $500).

Typical of liberals to idolize hypocritical socialist Democrats like multi-millionaire Elizabeth Warren. A quick search engine look proves Warren is anything but a champion against special interests.

Warren built her progressive [read "liberal/extreme far left")
rock star image and her campaign by attacking the wealthy factory owners and others who supposedly do not pay their “fair share” and take advantage of loopholes to live off of infrastructure paid for by others.

Yet Warren appears to be one of those people who takes advantage.

Warren falsely and without any legitimate legal basis claimed to be Cherokee for employment purposes. Warren also cheaped out by failing to register for the Massachusetts Bar despite an active practice of law in Cambridge since the mid-1990s, thereby evading Bar registration dues.

Warren obtained fee waivers from at least 50 federal bankruptcy courts so she would not have to pay for access to the federal PACER system, even in years when she had a high 6-figure income and an 8-figure net worth.

In 2008, the earliest year for which Warren has released income tax returns, Warren and her husband had a combined income of $831,208, which increased in 2009 to $981,670. Warren’s net worth as of the end of 2011 was as high as $14.5 million.

Sadly, since the early 1900s, the ESTABLISHMENT Republicans aided and abetted the extremist far left liberal Democrats in the destruction of our constitutional republic.

Everyone can plainly see that the DOJ under Obama and Holder is about everything except "justice" for all.

Anon is the proverbial kettle calling the pot black.

Anonymous said...

So 858...Sadly, since the early 1900s, the ESTABLISHMENT Republicans aided and abetted the extremist far left liberal Democrats in the destruction of our constitutional republic. The Republicans did start it. With the Tea Party now and the number of republican candidates running for President, there is no unity.
You were correct in that assumption of the Party of Blame 858

Anonymous said...

How the Tea Party got dragged into this is beyond understanding.

The Tea Party. founded in 2009, was a direct response against Establishment Republicans. The term "Tea Party" refers to constitutional conservatives whether they come from "R", "D", or "I"....

Anon 1:29 conflates historical fact to meet his/her political meme. Facts are stubborn things. Go look them up.

Anonymous said...

I never cease to be amazed at how liberal leftists punt and change the subject when the truth about what they and their idols are really all about.

And their constant fetish with slandering and libeling an original political American movement such as The Tea Party... about which most liberal leftists know very little... is just fascinating.

Anonymous said...

Who started most of the wars 428/422/ and others. Are you all republicans that can't settle on one person...Speaks volumes of the pains.