Nomi Prins, a former investment banker who once worked for Goldman Sachs and Bear Stearns, recently appeared on Democracy Now! Amy Goodman questioned Prins about the collapse of MF Global and John Corzine’s testimony before Congress.
Corzine has claimed that he never directed anyone at MF Global to misuse investors’ funds. A witness named Terry Duffy, however, has testified that “Corzine was aware of loans that may have used customer money.” Duffy is chairman of the Chicago Mercantile Exchange.
In her interview with Amy Goodman, Prins spoke about a clip of Corzine’s testimony that she and Goodman watched: “We’re listening to someone try and dodge his way out of responsibility and accountability, which is very much what all of the CEOs on Wall Street have done through the subprime crisis and through past crises.” Prins added, “And for him to sit there in front of Congress and talk about ‘not intending’ and ‘I didn’t know’ and ‘I didn’t instruct’ and ‘I didn’t misuse’ and all these sort of legal maneuvers around this issue really is deplorable.”
Deplorable indeed! Especially when one considers that we supposedly got “financial” reform after the financial crisis of 2008 with the passage of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
Goodman asked Prins to talk about the Dodd-Frank Act.
Prins replied that Dodd-Frank “doesn’t protect consumers, and it didn’t reform Wall Street. So, you can call it anything you want to call it, but the fact is that these banks, that were big before the subprime component of what is now a global crisis, are bigger than they were. They have more derivatives exposures than they did. They are taking more risks than they did. They are getting away with more than they did. And they are doing it with more reliance on federal subsidies than they did before what happened in 2008. So everything, by every standard, with respect to risk and coddling of Wall Street, is worse than it was before 2008, before that act. And there is no opposition in Washington, which is why—you know, talk about an Occupy movement. That’s about the only opposition that’s happening right now.”
Goodman spoke of how President Obama while adopting some of the language of the Occupy Wall Street movement “is also receiving more money from Wall Street than any president in history.”
Prins said that is the reason she thinks Obama won’t do anything that would hurt his relationship with the Wall Street community. “So, what he says—and I believe, truly, they discount what he says with respect to supporting the Occupy movement. And it’s nice that he’s saying it, but in terms of actually doing something, he has shown—he had the opportunity to really push through major reforms, and instead backed this very lukewarm act that does nothing. And I don’t see him doing anything different than that besides talking, unfortunately, between now and the election. He’s really acted more than he’s spoken. I mean, well, he’s done both, but his actions speak louder than his words, I should say.”
Goodman and Prins also talked about how thousands of the Occupy Wall Street movement protestors and demonstrators have been arrested while Wall Street executives seem to have been left untouched after the financial crisis that cost taxpayers trillions of dollars in bailout money.
Prins said that every now and then someone will be “thrown under a bus for some sort of minor trade that happened, but none of the executives that had the accountability, that made the millions of dollars, that had the power, that had the political connections, that had the meetings in Washington that enable them to do what they do, none of those people have been arrested.” She faulted the kind of questioning that Corzine received from members of Congress—and added that even when the testimony is sent to the Justice Department little is likely to happen because “there is a big punt going on at the Washington level.”
Earlier this year, Matt Taibbi wrote an article for Rolling Stone titled Why Isn’t Wall Street in Jail? In the article, he revealed how the feds have been doing more to protect than to prosecute the financial criminals who helped to bring down the world economy. Taibbi spoke to a former Senate investigator who laughed and explained the situation succinctly: “Everything’s fucked up, and nobody goes to jail.” The former investigator added, “That’s your whole story right there. Hell, you don’t even have to write the rest of it. Just write that.”
SOURCES
Corzine Grilled over MF Global Collapse After Witness Suggests Knowledge of Misused Funds (Democracy Now)
FURTHER READING
Corzine: MF Staff Said Fund Transfer Legal (Bloomberg)
Tossed Bomb: Former MF Global CEO Jon Corzine Aware of Money Transfer, Says Senate Witness (ABC News)
TARP To Cost The U.S. Nearly Double The Initial Estimates: CBO (Huffington Post)
Bank of America & The Great Derivatives Transfer (Turley Blawg)