Intro: "More than $4 trillion in near zero-interest Federal Reserve loans and other financial assistance went to the banks and businesses of at least 18 current and former Federal Reserve regional bank directors in the aftermath of the 2008 financial collapse, according to Government Accountability Office records made public for the first time today by Sen. Bernie Sanders."
Sen. Bernie Sanders (I-Vt.). (photo: WDCpix)
Sanders Releases Explosive Bailout List
13 June 12
ore than $4 trillion in near zero-interest Federal Reserve loans and other financial assistance went to the banks and businesses of at least 18 current and former Federal Reserve regional bank directors in the aftermath of the 2008 financial collapse, according to Government Accountability Office records made public for the first time today by Sen. Bernie Sanders.
On the eve of Senate testimony by JPMorgan Chase CEO Jamie Dimon, Sanders (I-Vt.) released the detailed findings on Dimon and other Fed board members whose banks and businesses benefited from Fed actions.
A Sanders provision in the Dodd-Frank Wall Street Reform Act required the Government Accountability Office to investigate potential conflicts of interest. The Oct. 19, 2011 report by the non-partisan investigative arm of Congress laid out the findings, but did not name names. Sanders today released the names.
"This report reveals the inherent conflicts of interest that exist at the Federal Reserve. At a time when small businesses could not get affordable loans to create jobs, the Fed was providing trillions in secret loans to some of the largest banks and corporations in America that were well represented on the boards of the Federal Reserve Banks. These conflicts must end," Sanders said.
The GAO study found that allowing members of the banking industry to both elect and serve on the Federal Reserve's board of directors creates "an appearance of a conflict of interest" and poses "reputational risks" to the Federal Reserve System.
In Dimon's case, JPMorgan received some $391 billion of the $4 trillion in emergency Fed funds at the same time his bank was used by the Fed as a clearinghouse for emergency lending programs. In March of 2008, the Fed provided JPMorgan with $29 billion in financing to acquire Bear Stearns. Dimon also got the Fed to provide JPMorgan Chase with an 18-month exemption from risk-based leverage and capital requirements. And he convinced the Fed to take risky mortgage-related assets off of Bear Stearns balance sheet before JP Morgan Chase acquired the troubled investment bank.
Another high-profile conflict involved Stephen Friedman, the former chairman of the New York Fed's board of directors. Late in 2008, the New York Fed approved an application from Goldman Sachs to become a bank holding company giving it access to cheap loans from the Federal Reserve. During that period, Friedman sat on the Goldman Sachs board. He also owned Goldman stock, something that was prohibited by Federal Reserve conflict of interest regulations. Although it was not publicly disclosed at the time, Friedman received a waiver from the Fed's conflict of interest rules in late 2008. Unbeknownst to the Fed, Friedman continued to purchase shares in Goldman from November 2008 through January of 2009, according to the GAO.
In another case, General Electric CEO Jeffrey Immelt was a New York Fed board member at the same time GE helped create a Commercial Paper Funding Facility during the financial crisis. The Fed later provided $16 billion in financing to GE under this emergency lending program.
Sanders on May 22 introduced legislation to prohibit banking industry and business executives from serving as directors of the 12 Federal Reserve regional banks.
To read a report summarizing the new GAO information, click here.
Jamie Dimon Is Not Alone
During the financial crisis, at least 18 former and current directors from Federal Reserve Banks worked in banks and corporations that collectively received over $4 trillion in low-interest loans from the Federal Reserve.
US Senator Bernard Sanders (I-Vt.)
Washington, DC
June 12, 2012
- Jamie Dimon, the Chairman and CEO of JP Morgan Chase, has served on the Board of Directors at the Federal Reserve Bank of New York since 2007. During the financial crisis, the Fed provided JP Morgan Chase with $391 billion in total financial assistance. JP Morgan Chase was also used by the Fed as a clearinghouse for the Fed's emergency lending programs.
In March of 2008, the Fed provided JP Morgan Chase with $29 billion in financing to acquire Bear Stearns. During the financial crisis, the Fed provided JP Morgan Chase with an 18-month exemption from risk-based leverage and capital requirements. The Fed also agreed to take risky mortgage-related assets off of Bear Stearns balance sheet before JP Morgan Chase acquired this troubled investment bank.
- Jeffrey Immelt, the CEO of General Electric, served on the New York Fed's Board of Directors from 2006-2011. General Electric received $16 billion in low-interest financing from the Federal Reserve’s Commercial Paper Funding Facility during this time period.
- Stephen Friedman. In 2008, the New York Fed approved an application from Goldman Sachs to become a bank holding company giving it access to cheap Fed loans. During the same period, Friedman, who was chairman of the New York Fed at the time, sat on the Goldman Sachs board of directors and owned Goldman stock, something the Fed’s rules prohibited. He received a waiver in late 2008 that was not made public. After Friedman received the waiver, he continued to purchase stock in Goldman from November 2008 through January of 2009 unbeknownst to the Fed, according to the GAO. During the financial crisis, Goldman Sachs received $814 billion in total financial assistance from the Fed.
- Sanford Weill, the former CEO of Citigroup, served on the Fed's Board of Directors in New York in 2006. During the financial crisis, Citigroup received over $2.5 trillion in total financial assistance from the Fed.
- Richard Fuld, Jr, the former CEO of Lehman Brothers, served on the Fed's Board of Directors in New York from 2006 to 2008. During the financial crisis, the Fed provided $183 billion in total financial assistance to Lehman before it collapsed.
- James M. Wells, the Chairman and CEO of SunTrust Banks, has served on the Board of Directors at the Federal Reserve Bank in Atlanta since 2008. During the financial crisis, SunTrust received $7.5 billion in total financial assistance from the Fed.
- Richard Carrion, the head of Popular Inc. in Puerto Rico, has served on the Board of Directors of the Federal Reserve Bank of New York since 2008. Popular received $1.2 billion in total financing from the Fed's Term Auction Facility during the financial crisis.
- James Smith, the Chairman and CEO of Webster Bank, served on the Federal Reserve's Board of Directors in Boston from 2008-2010. Webster Bank received $550 million in total financing from the Federal Reserve's Term Auction Facility during the financial crisis.
- Ted Cecala, the former Chairman and CEO of Wilmington Trust, served on the Fed's Board of Directors in Philadelphia from 2008-2010. Wilmington Trust received $3.2 billion in total financial assistance from the Federal Reserve during the financial crisis.
- Robert Jones, the President and CEO of Old National Bancorp, has served on the Fed's Board of Directors in St. Louis since 2008. Old National Bancorp received a total of $550 million in low-interest loans from the Federal Reserve's Term Auction Facility during the financial crisis.
- James Rohr, the Chairman and CEO of PNC Financial Services Group, served on the Fed's Board of Directors in Cleveland from 2008-2010. PNC received $6.5 billion in low-interest loans from the Federal Reserve during the financial crisis.
- George Fisk, the CEO of LegacyTexas Group, was a director at the Dallas Federal Reserve in 2009. During the financial crisis, his firm received a $5 million low-interest loan from the Federal Reserve's Term Auction Facility.
- Dennis Kuester, the former CEO of Marshall & Ilsley, served as a board director on the Chicago Federal Reserve from 2007-2008. During the financial crisis, his bank received over $21 billion in low-interest loans from the Fed.
- George Jones, Jr., the CEO of Texas Capital Bank, has served as a board director at the Dallas Federal Reserve since 2009. During the financial crisis, his bank received $2.3 billion in total financing from the Fed's Term Auction Facility.
- Douglas Morrison, was the Chief Financial Officer at CitiBank in Sioux Falls, South Dakota, while he served as a board director at the Minneapolis Federal Reserve Bank in 2006. During the financial crisis, CitiBank in Sioux Falls, South Dakota received over $21 billion in total financing from the Federal Reserve.
- L. Phillip Humann, the former CEO of SunTrust Banks, served on the Board of Directors at the Federal Reserve Bank in Atlanta from 2006-2008. During the financial crisis, SunTrust received $7.5 billion in total financial assistance from the Fed.
- Henry Meyer, III, the former CEO of KeyCorp, served on the Board of Directors at the Federal Reserve Bank in Cleveland from 2006-2007. During the financial crisis, KeyBank (owned by KeyCorp) received over $40 billion in total financing from the Federal Reserve.
- Ronald Logue, the former CEO of State Street Corporation, served as a board member of the Boston Federal Reserve Bank from 2006-2007. During the financial crisis, State Street Corporation received a total of $42 billion in financing from the Federal Reserve.
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Comments
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libel, the taxpayer picks up the tab! They might change police chiefs, but the beat goes on.
There are two Presidents who tried to shut down the Federal Reserve. JFK and Lincoln. Hmmmm...what do they have in common?
The system was established to do exactly what it has done, Congress was on the payroll of JP Morgan even before 1913 when the Federal Reserve act was passed...The Government has been owned by the Banks as far back as Hamilton!
There were other laws and agencies of government that regulated banks, so banks were never until now able to use the full power of the control of the money supply. Now most government reguatlions on banks are too weak to matter. The FED is now supposed to regulate banks -- i.e., banks regulate themselves.
There's no way out of the banking criminal syndicate without breaking up the FED. People laughed when Ron Paul said that. But he was right.
The Fed is the third central bank in our history (the first two were dissolved earlier). Its charter was granted by Congress in 1913 under the influence of bankers who lobbied for it. It is exactly what was feared by Jefferson for the very reasons we see before us.
I know you don't like Obama, and there are things that you can legitimately criticise him for. But keep your criticisms to those things that are legitimate.
Morgan had several members of congress on his payroll going back before the turn of the century, and including the sugar trust and the tarrifs to control the US domestic price of Sugar...the Depression of 1907 was a set up to bring in the Federal Reserve system in two phases. The 1909 act and the act of 1913.
In 1907, J.P. Morgan published rumors that the Knickerbocker Trust Company was insolvent. This was a deliberate act of market manipulation which precipitated the Panic of 1907, and consolidated the preeminence of the banks controlled by Morgan. The panic itself led to the passage of the Aldrich–Vreelan d Act in 1908, (Aldrich was closely associated with Morgan, and the Rockefeller banking interest) The act established the National Monetary Commission, sponsored and headed by Aldrich. After issuing a series of 30 reports, this commission drew up the Aldrich Plan, forming the basis for the Federal Reserve system.
Nelson W. Aldrich worked with several key bankers and economists, including Paul Warburg, Abram Andrew and Henry Davison, to design the plan for an American central bank in 1911. they designed the plan for the Federal Reserve.
JP Morgan did the same thing with Washington Mutual when they wanted to take over that banking operation, they spread rumers that Wamu was insolvent and immediately the FDIC gave it to Morgan
Here's a list of top donors to Obama's campaign.
Microsoft Corp. $347,916
DLA Piper $297,027
Univ.of California $261,846
Sidley Austin LLP $240,846
Google Inc $212,719
Now here's a list of top donors to Romney's campaign.
Goldman Sachs $573,080
JPMorgan Chase & Co $415,075
Bank of America $398,850
Morgan Stanley $373,850
Credit Suisse Group $317,410
Notice the first list has no bankers and the second list is all bankers. Now, who is on who's payroll?
BTW The source is the Federal Election Commission.
PS The subject of the discussion is Obama, not the Congress, so don't obscure the issue by including the Congress.
http://news.yahoo.com/obama-assets-jpmorgan-accounts-white-house-222254071--sector.html
http://content.usatoday.com/communities/onpolitics/post/2012/05/jp-morgan-chase-campaign-donations-obama-romney-/1
They provide money to their employees who make the donation (wink--Wink) if you want to find out how much a particular bank has donated look up the bank and ask the question...it will not show at the source you quoted!
"whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness." -
In case this is not recognized....i ts the United Stated Declaration of Independence.
socialize losses...
I am clueless as to how this happens over and over and over. The very treasury of WETHEPEOPLE is looted over and over and over, and the (graphic, descriptive expletiveS deleted) sociopaths whine and complain about protesters?
How about that selFRIGHTeous rant by the pig Rick Santelli on CNBC back in '09
http://video.cnbc.com/gallery/?video=1039849853
"subsidize LOOSERS mortgages"...
souless knee-jerk little piggies, imho.
i think there is often a dynamic where PPSL makes sense, as in war.
the problem is that this is not the only meme, but casting the world and the economy and even social life as a competition ultimately war by its nature creates a selfish belligerent, arrogant, elite that has the will, the resources and the power to grow to take over the society.
it makes sense to support some very brilliant talented people and when they make mistakes to socialize those losses because we all in sense vote to do that … but today there is not voting, there is not informing, there is lying, coercion, threats, EXISTENTIAL threats, as in no American can any longer survive in this country unless they pay tribute and lip service to the machine … whose mask is the Republican party - behind which are the people who would be God's … festering and corrupt and unable to see any of the rest of us as real human beings with right to exist in this world.
EXACTLY … for the big losers to be supported the big winner have to chip in.
The country is too big to fail, as are we all. It is very sad to see almost the whole country being treated like it is an expendable liability, and treated like we can just be jettisoned any time the Koch brothers or their buddies want to kick the dog - so to speak.
I'm not like a lot of Liberals, I think the US has a role to play as the policeman of the world, the world is a mess and needs someone to kick ass the start to clean it up. We are the only ones who can do that and have gotten demostrably better at it over the years … ie. compare Iraq with Viet Nam.
So, in order for that facet of our being to be fullfilled, the social and domestic side of things need to be taken care of too … both sides need to recognize the other - even if they hate each other ,and figure out a way to move forward together.
If we want to have a giant military and expect Americans to fight, then we need to treat them as part of the family and support then with health care, education, jobs, etc. And if Americans want their government to serve them they must take on the responsbility of managing the massive problems of the world that always make it to our shores.
We lost both wars! and were in them for the spoils, The CIA wanted the Drugs from the Golden Triangle...In Iraq would you believe its Oil? and as for being the worlds police department, we have along way to go to clean up our own mess here first. We have supported every dictator around the world, do you think that was by accident?
The banks are far worse than Ma Bell ever was.
This is true. I was surprised to find this out. They sound so official but it's just the bank as they wanted to seem.
The solution is obviously simple. The Fed has lost all moral authority to have any role in our fiscal policy so change must be made. First the head of the Fed cannot be someone who has been employed by any bank above the level of Bank Teller. Second, restore Glass-Steagall. Restore it it without caveats, exceptions or fine print. Third, each state should have its own state run Bank. The regionals answer to the states in its regions, who elect the regional governor. No governor can work for any bank that would be eligible for bailouts or be insured by the Fed.
Lastly, new rule Number 0. Any bank or financial institution that is too big to fail is too big.
After that part is done, get Bernie and Elizabeth Warren together in a room and let them write up the regulating rules around usury and no b.s. financial contracts.
Probably end up with less regulation, less hair splitting, and smaller bubbles.
(the above will never happen unless we insist on having Progressive candidates, this is a local issue)
I like the part about Sanders and Warren writing the new rules that banks have to live by.
I am this far from voting third-party, because I can no longer stomach the Democrats. Socially, they appear to be more evolved than their Republican brethren, but fiscally they appear to be just as hostile to laws that are designed to protect small businesses and the 99% as their Teabagging colleagues.
Of course, given nationwide voter purges and pre-programmed Diebold machines, that presupposes that my vote even counts.
Of course the owner of the Diebold are republicans. There is no paper trail to prove or dis-prove a bunch of Election fraud. That is on a much bigger scale that voter fraud. The state I'm living in took a 10 year survey and found 7 cases of voter fraud in 10 whole years! It seems like the recent anti-voter fraud case is like a sledge hammer to a ladybug .
They continue to demonstrate their incompetence and avarice while regulators collect their salaries and mark time waiting for their jobs in the "industry".
I'm not going to hold my breath waiting for convictions of these thieves, but I hope Bernie's work will change peoples' conception of where all the money went and continues to go.
What we need is to have economists like Stiglitz, Krugman and Reich overseeing the economy, not MBA, Ayn Rand/Milton Freidman-worshi pping banksters.
Yikes! That is some serious lunch money.
Sanders might be the only Senator left with a functioning conscience.
And just how many other members of Congress are standing up to the gamblers?
Maybe if Elizabeth Warren gets elected we'll have two.
The gentle reader will notice the corrupt scum named in this article and their related banks and businesses take the risks they take with OPM (other people's money).
You can bet these hotshots are not risking their own loot. This is standard operating procedure for the frauds in this arena.
we do need more bernie sanders and elizabeth warrens.
i'm not picky. i'll vote for integrity and disclosure. too bad the majority of utahns vote republican straight ticket. the only real option we have is between republicans and tea partyers.
Most of us were unhappy with our new hero, but I still give him a good chance, because after all, even before he took office the likes of Mitch McConnell were telling his fellow legislators TO MAKE as their number one TOP priority to make Obama a one term president.
They DID make it TOP priority, over the good of we the people, over the good of the Nation, and over the debt!
They passed the same thing for BUsh 17+ times during his 8 years.
Even if they were the ones who had brought the bill, even if they had repeatedly passed things, even when it made NO Sense, the still put that as top priority!
They obstructed all they could in votes and filibusters.
The other thing that is important is that no matter how disappointed you are,, He is Way Better than Romney!
Every vote for democrat and you weaken those trying to kill your spirit.
a progressive majority in the House; & a filibuster proof majority in the Senate. No excuses, just BETRAYAL.
They want to de-regulate the banks, they want to give even Bigger tax breaks to the corrupt 1%.
A Democrat is Always a better vote for the common people!
You forgot maybe that the republicans took the unemployed hostage, and that they tooK the debt ceiling hostage.
And evn before he took office the republicans were UNIted against him in every way.
In REAL Capitalism businesses that behave badly and unethically fail. That is the real self-regulation of the system. These banks and financial institutions should have been allowed to fail and individual depositors should have been reimbursed.
Sorry... can't recall website. But it probably could be googled.
The Fed should be set up like a non-partisan OMB, but neither aspiring nor ex-banksters should be allowed on it. The goal would be non-profit, aimed at all classes of banking needs, but most of all, stability to the labor market.
If business and farmers (latest desire of the peanut farmers for insurance against losses) need stability in the market place to survive - why not the average working stiff?
Stability or a steady life style as in "Life liberty and the pursuit of happiness" shpould be the goal of the "system" for all, but, alas, the 1% crowd has coöpted the system to the extent that they have destroyed it.
THIS IS INSUFFERABLE AND THERE SHOULD BE NO REASON FOR IT - there is no reason for it other than the consolidation of political power by a small group of people that justify by their exploitation of the rest of us for reasons that over time as we get more data and think more about it - MAKES LESS AND LESS SENSE AND HAS LESS AND LESS JUSTICE OR EFFICIENCY TO IT.
Legal name changes or are these sneaky AKAs?
If they get into the white house they WILL rig it So that no Democrat can ever again get elected. That is almost what happened in Wisconsin.
So wake up stand up for what is right and true, and vote a democrat every where possible!
i agree that obama has really done nothing for average people, but the average people have not really made enough of a noise - like nowhere near the whining level of Republicans, how do we expect to get him to act when we will not?
as to calling them pals … it's really just an emotion laden word with no meaning and no basis. individual politicians even the president do not have to work together or like each other in order to be pulled in the direction of money.
and whomever wins the fake election of 2012 will genuflect at their feet.
"ask not what corporate america can do for you...ask what you can do for corporate america."
Al Capone
Meyer Lansky
The O'Bannion Brothers
Vito Genevese
Joey "Bananas" Bonano
My problem with the list I just named is the people in the list would blush at the current length and depth of Wall Street and bankster Criminality
On 5/14/12 I received the following message from a Pentagon interest in Belgium to his family. "You must all be out of the United States by 1st July or you will never leave the United States."
Does anyone think barry's puppet masters have come this far in destroying this nation they will slam on the breaks now.
There will be no November election, we will be in Martial Law, there will be no Legslature or Supreme Court, there will be King barry with his police state to protect him and destroy us. This is the world behind the 932 executive orders he has signed in 40 months, the 15,000 drones in production. This is only the very beginning of the American Holocaust.
Fillade
-- over the period of the loan, what is the difference between the interest paid on these loans versus on regular loan (for the likes of you and me)?
-- and how many of the loans have (or will!) default through bankruptcy? Lehman for example.
The figure will still be astronomical, but it will be the correct figure for outright robbery and waste.
The bankers - put them in jail now. Such dogs. What is happening to our nation? We cannot let this continue. Is it time for the revolution yet?
The gov't itself must perform its constitutional obligation and right to "coin Money" (Art. 1, Sec. 8, clause 5), as it did in Lincoln's time - the first United States Notes - as it still does, with coins and stamps (for a limited purpose). These are all forms of debt-free money. They can be issued any time, in any amount, for any reason. There are and have been several proposals to do this (HR2990 is just the most recent one; transportation secretary Ray LaHood tried to reissue U.S. Notes when he was in Congress).
When private banks will not issue sufficient money to meet the productive capacity of the nation, Congress must step in for "We The People."
We lost our Monetary Sovereignty in 1913, and MUST take it back from the private banking cartel that now rules our nation.
But this is good, so hang in there Bernie.
Hey, this is a bit off topic but not really.
Why not ask these politicians and the dimwits that elect them why they seem to think the enemy won WWII. (FDR)
And if they don't think that, why do they act like it?
I don't mean for this to seem in the least like a polite or civil question. It's serious.
http://www.youtube.com/watch?v=jbejGzw3-E0&feature=related
The Occupiers were right....they just don't have the foresight to work through the political system for change. The fed needs to be overhauled.
It's imperative the Democrats regain the House, get more Senators, and reelect Obama. Else the Republic is in danger of being overtaken by Corporations.
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