Is the American Dream becoming an American Nightmare?
Recently I wrote about the 2019 Corruption Perceptions Index published annually since 1995 by Transparency International, which ranks countries “by their perceived levels of corruption, as determined by ‘expert assessments’ and opinion surveys.”
This year’s study highlighted the relationship between politics, money and corruption. The disturbing news is that the United States, scoring 69, has received its lowest score in eight years and marks the first time since 2011 that the U.S. falls outside of the top 20 countries on the index.
I thought about this and looked for other citations that would justify it. The scope of what I found is huge and disheartening. I’ll cite just a few articles that relate to my former area of expertise, banking, at least related to many of the largest banks, as that “profession” seems to be so blatantly corrupt and has such widespread influence.
The Debate is Over
In September of 2016, Pam Martens and Russ Martens writing for Wall Street On Parade led off with The Debate Is Over… Banking Has Become a Criminal Enterprise in the U.S.
The authors cited Wells Fargo and the U.S. Senate Banking Committee which was holding” a hearing to take testimony from Wells Fargo CEO John Stumpf and Federal regulators to understand how this megabank was able to get away with opening more than two million fake customer accounts over a span of years.”
And yet the hearing would not have happened without the extensive media coverage that occurred when the Consumer Financial Protection Bureau (CFPB) announced a $185 million settlement over the charges on September 8.
The authors also mentioned Citibank, which settled charges with the CFPB for $700 million for deceptively selling add-on products to credit card customers, and yet the “Senate Banking Committee yawned and did nothing.” They mentioned that part of my testimony and appearance on 60 Minutes brought this to light.
They go on to say JPMorgan Chase was accused of “massive criminal securities fraud” by Alayne Fleishman, an attorney, and her story was covered up by Chase and the Justice System.” They claimed, “the disease is a U.S. banking sector that relies on fraud and abuse of its customers to meet its profit targets just as the low-level employees of these banks are pressured into fraudulent acts to meet their sales quotas.”
Greed again
Unfortunately, fraud is alive and flourishing and the incidences keep growing. The DataVisor Fraud Index Report for 2018, which I have written about before, reports a dramatic growth in fraud infrastructure. North America seems to be a leading source of financial crime, and the PWC’s 2018 Global Economic Crime and Fraud Survey suggests that 51 percent of corporate organizations are blissfully ignorant and ignoring their obvious fraud problem. These banks sure have.
When the Business Roundtable (BRT) an association of CEO’s of 193 companies with over $7 trillion in revenue and almost 15 million employees, revised their definition of the purpose of a corporation, from just providing returns to their shareholders and claimed, “Each of our stakeholders is essential. We commit to deliver value to all of them, for the future success of our companies, our communities and our country,” I was hopeful.
Alive but fraying
Jamie Dimon, Chairman & CEO of J.P. Morgan Chase and chairman of the Roundtable said, “The American dream is alive but fraying, major employers are investing in their workers and communities because they know that it is the only way to be successful over the long term. These modernized principles reflect the business community’s unwavering commitment to continue to push for an economy that serves all Americans.” And I felt really hopeful some of these trends would be reversed, in spite of JPMorgan Chase and several others who are BRT’s members not always operating aboveboard.
Well, perhaps I should have taken this with a grain of salt. Actions speak louder than words. The Wall Street on Parade January 2020 article tells us that Jamie Dimon has received a pay raise to $31.5 million based on his “performance” for the year 2019. Ethical? What do you think?
The massive compensation comes at a time when the federally insured bank is under its fourth criminal probe by the U.S. Department of Justice, all of them occurring while Mr. Dimon sat at the helm of the bank with all of this occurring within the past seven years.
Alive and well
It’s no wonder that the same article reminds us that fraud is alive and well – and flourishing. The article mentions that JP Morgan Chase is the only major Wall Street bank to be compared to the Gambino Crime Family, in a book by two trial lawyers, Helen Davis Chaitman and Lance Gotthoffer, JP Madoff: The Unholy Alliance between America’s Biggest Bank and America’s Biggest Crook. The authors titled Chapter Five of the book as: “The Case for Prosecuting Officers of JPMorgan Chase Under RICO” (the racketeer Influenced and Corrupt Organization Act).
The lawyers emphatically state, “This country cannot move forward with integrity until it faces the fact that bankers have criminalized the financial services industry. We, the people, have to demand an honest government that enforces the law, even against super-rich criminals. As Robert Kennedy said,“Every society gets the kind of criminal it deserves. What is equally true is that every community gets the kind of law enforcement it insists on…” If Jamie Dimon is running a criminal institution, he should be prosecuted for it. And law enforcement has the perfect tool for such a prosecution: The Racketeer Influenced and Corrupt Organizations Act (‘RICO’).”
Funny, how Mr. Dimon was prosecuted… with an increase in pay to $31.5 million! What kind of message does this send to employees? Lie, cheat, steal from your customers; you’ll get rewarded for it!
Transparency International made recommendations that could reverse the trend and said, “If none of these objectives are tackled by the U.S. Congress, expect the U.S. to fall further toward third-world corruption status.” Their recommendations:
- Control political financing to prevent excessive money and influence in politics;
- Manage conflicts of interest and address ‘revolving doors’;
- Regulate lobbying activities by promoting open and meaningful access to decision-making.
However, these recommendations may be far too late to be implemented with much success. Unfortunately, our slide downward shows that fraud, corruption, unethical behavior in business and government is alive and flourishing. And it seems no one cares.
Richard Bowen is widely known as the Citigroup whistleblower. As Business Chief Underwriter for Citigroup during the housing bubble financial crisis meltdown, he repeatedly warned Citi executive management and the board about fraudulent behavior within the organization. The company certified poor mortgages as quality mortgages and sold them to Fannie Mae, Freddie Mac and other investors.
