Yesterday, we started the day off looking at how conservative Democrats are joining with the Republicans to gut Dodd-Frank and set Wall Street free to rip off America and Americans again, Elizabeth Warren and progressive House candidates Austin Frerick (IA), Tim Canova (FL), Lillian Salerno (TX), DuWayner Gregory (NY), Ellen Lipton (MI) and Sam Jammal (CA) explained why that's a terrible idea. "Giant regional banks," wrote Canova, "are trying to mischaracterize this bill as an effort to help small banks and rural communities. In reality, this legislation would relax regulatory oversight of dozens of huge banks with more than $50 billion in assets. This may well undermine not just consumer protections, but the safety, soundness, and stability of the financial system. Instead of deregulating big banks, Congress should be creating public banking alternatives, including a national infrastructure bank, to serve the needs of our local communities." And Ellen Lipton added that "If there's any issue to take a stand on, and NOT engage in bipartisan hand-holding, it would be this one. The elimination of this regulation would allow an institution like Countrywide off the hook."Do you ever read Wall Street on Parade. On Wednesday Pam and Russ Martens wrote that "nothing buttresses Senator Bernie Sanders’ position that fraud on Wall Street is not a bug but a feature better than the news last week that the Citigroup Board was bumping up CEO Michael Corbat’s pay by 48 percent to $23 million for 2017." I'd like to see Elizabeth Warren take on Corbat at a Senate hearing, wouldn't you?
Corbat has sat at the helm of the bank since October 2012 as the bank has paid more than $12 billion in fines and restitution for serial abuses of the public and investors, including its first criminal felony count in more than a century of existence. The felony count came on May 20, 2015 from the U.S. Department of Justice over the bank’s involvement in a bank cartel that was rigging foreign currency markets. Numerous other charges against the bank have focused on money-laundering. Citigroup’s long history of involvement in money-laundering also gives the appearance of being a feature not a bug.Aside from the feeling that overseeing a business model of fraud on Wall Street is a road to riches for Wall Street’s mega bank CEOs, there is the disquieting question as to whether this strangely uniform obscene pay of the top dogs on Wall Street is being orchestrated by another invisible cartel.On October 14, 2016 Bloomberg News’ reporters Greg Farrell and Keri Geiger landed the bombshell report that the top lawyers of the biggest Wall Street banks had been meeting secretly for two decades with their counterparts at international banks. At the 2016 secret meeting, held in May at a posh hotel in Versailles, the following were among the big bank lawyers: Gregory Palm, part of the Management Committee at Goldman Sachs; Stephen Cutler of JPMorgan (a former Director of Enforcement at the SEC); Gary Lynch of Bank of America (also a former Director of Enforcement at the SEC); Morgan Stanley’s Eric Grossman; Citigroup’s Rohan Weerasinghe; Markus Diethelm of UBS Group AG; Richard Walker of Deutsche Bank (again, a former Director of Enforcement at the SEC); Robert Hoyt of Barclays; Romeo Cerutti of Credit Suisse Group AG; David Fein of Standard Chartered; Stuart Levey of HSBC Holdings; and Georges Dirani of BNP Paribas SA.Reuters reported last Friday how Corbat’s $23 million pay compared to his peers on Wall Street. It noted that Jamie Dimon, CEO of JPMorgan Chase is now making $29.5 million. (Dimon has presided over three criminal felony counts at the bank within the past four years while keeping his job and watching his pay skyrocket.) Morgan Stanley CEO James Gorman is making $27 million. Lloyd Blankfein, whose bank is tiny compared to JPMorgan Chase, is making $22 million. And Bank of America’s CEO Brian Moynihan is being paid the same as Corbat, $23 million after recently getting a 15 percent pay boost.Every one of the top lawyers of these banks were at that secret confab in 2016.The most recent proxy filed by JPMorgan Chase goes to inordinate lengths to justify what it is paying its CEO Jamie Dimon. It includes a graph comparing his pay to peer bank CEOs and another graph that shows what percent of profits he and the CEOs of peer banks are receiving. (How that became a relevant metric is anyone’s guess. These are not, after all, family-owned businesses but banks that are subsidized by a taxpayer backstop for their trillions in insured deposits which typically earn less than one percent interest as the banks simultaneously charge 10 to 20 percent interest on their credit cards issued to the struggling middle class of America.)A better metric would be how much shareholders have lost from fines and settlements under the reigning CEO. In Jamie Dimon’s case, it’s north of $36 billion since the financial crisis in 2008. Additionally, there’s those three criminal felony counts, the first in the bank’s more than century-old existence. Two felony counts were leveled by the U.S. Justice Department in 2014 for the bank’s role in Bernie Madoff’s Ponzi scheme. Another felony count came the very next year for the bank’s role in the foreign exchange rigging.The era of obscene pay on Wall Street has occurred side-by-side with the era of serial charges of crimes. There is only one way to interpret this: the Boards of Directors of these banks have lost their moral compass.
Katie Porter, a professor at UC, Irvine, has worked closely with Elizabeth Warren on bankster problems-- in fact they co-authored a book about Wall Street abuses. Today she told us, regarding the bill to gut Dodd Frank, "This is unacceptable. This bill is a disaster for consumers and shows just how much power Wall Street banks, powerful special interests, and their high priced lobbyists have in Washington. Congressional action to weaken and erode banking rules protecting consumers is what fueled our financial crisis, and, once again, we are seeing history repeat itself. I’ve spent my career fighting for middle-class families, and now I want to take that fight to Washington." Katie is running for the Orange County seat currently held by Wall Street shill Mimi Walters. Please consider helping Katie's campaign here. And... how about Bernie/Elizabeth 2020?
