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Bill Moyers interviewed William K. Black, who wrote The Best Way to Rob a Bank is to Own One, April 3rd. I highly recommend watching the video at Bill Moyers Journal. Embedding the video on my blog is prohibited; otherwise I would do so.

From the Bill Moyers Journal:

“William K. Black suspects that it was more than greed and incompetence that brought down the U.S. financial sector and plunged the economy in recession — it was fraud. And he would know. When it comes to financial shenanigans, William K. Black, the former senior regulator who cracked down on banks during the savings and loan crisis of the 1980s, has seen pretty much everything.

Now an Associate Professor of Economics and Law at the University of Missouri, William K. Black tells Bill Moyers on the JOURNAL that the tool at the very center of mortgage collapse, creating triple-A rated bonds out of “liars’ loans” — loans issued without verifying income, assets or employment — was a fraud, and the banks knew it.

And while there is no law against liars’ loans, Black points out that there are, “many laws against fraud, and liars’ loans are fraudulent. […] They involve deceit, which is the essence of fraud.”

Only the scale of the scandal is new. A single bank, IndyMac, lost more money than the entire Savings and Loan Crisis. The difference between now and then, explains Black, is a drastic reduction in regulation and oversight, “We now know what happens when you destroy regulation. You get the biggest financial calamity of anybody under the age of 80.”

Very watchable. Easily understood. Highly recommended. Watch it.


Financial Fraud — 2 Comments

  1. I couldn’t watch the video because of my dialup, but I read the transcript. Wow. This is very disheartening, to say the least. I was particularly appalled to hear that an existing law, the Prompt Corrective Action Law, is being ignored. I must say, the most discouraging thing is to think that President Obama is participating in the cover-up—that breaks my heart.

    The most discouraging thing is feeling like there’s not much I can do. I mean, I voted for Obama because he talked about real change. This is not change that I can believe in.

    Thanks for bringing this to our attention, Jeff. You dig up such enlightening things–thank you.

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