Big Banks Don’t Commit Any Crimes … Do They?

Here are some recent improprieties by the big banks:

  • Engaging in mafia-style big-rigging fraud against local governments. See this, this and this
  • Shaving money off of virtually every pension transaction they handled over the course of decades, stealing collectively billions of dollars from pensions worldwide. Details here, here, here, here, here, here, here, here, here, here, here and here
  • Pledging the same mortgage multiple times to different buyers.  See this, this, this, this and this.  This would be like selling your car, and collecting money from 10 different buyers for the same car
  • Committing massive fraud in an $800 trillion dollar market which effects everything from mortgages, student loans, small business loans and city financing
  • Pushing investments which they knew were terrible, and then betting against the same investments to make money for themselves. See this, this, this, this and this
  • Engaging in unlawful “Wash Trades” to manipulate asset prices. See this, this and this
  • Participating in various Ponzi schemes. See this, this and this
  • Bribing and bullying ratings agencies to inflate ratings on their risky investments

The executives of the big banks invariably pretend that the hanky-panky was only committed by a couple of low-level rogue employees.  But studies show that most of the fraud is committed by management.

Indeed, one of the world’s top fraud experts – professor of law and economics, and former senior S&L regulator Bill Black – says that most financial fraud is “control fraud”, where the people who own the banks are the ones who implement systemic fraud.  See this, this and this.

But at least the big banks do good things for society, like loaning money to Main Street, right?


  • The big banks have slashed lending since they were bailed out by taxpayers … while smaller banks have increased lending. See this, this and this

Category: Legal, Think Tank

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

7 Responses to “Are Big Banks Criminal Enterprises?”

  1. VennData says:

    The golden rules of banking – They make the rules, and get the gold

    “… The laws of supply and demand do not apply. When food producers compete to supply a supermarket, the retailer has the luxury of selecting the lowest bidder. But when it comes to investment banking, wages are very high even though the number of applicants is vastly greater than the number of posts. If the same was true of, say, hospital cleaning, wages would be slashed…”

    “… There is a survivorship bias in both fund management and trading. If your career starts with some bad losses, it will quickly come to an end. So, by definition, veteran traders will have had initial success. But that could be down to luck, not skill…”

    “…The trader-cum-executive will make the biggest mistake when he is in charge of the whole bank. By this stage, he will be personally rich and will remain so even if the entire bank fails, not least because:..”

  2. financialchicken says:

    Barry, I couldn’t agree more. There are a lot of people who should be in jail for this, and although ridiculously slow, I still hope the weals of justice are turning.

    After we throw these bums in jail, how do we insure that the next batch behave differently?

    For that, I’ve put some ideas into this blog post, please let me know what you think:

  3. [...] Are big banks criminal enterprises? Yes. (TBP) [...]

  4. I believe its possible because of real market advantages… and its utility for the user… to move a considerable portion of individual commons-related expenditures (charity and political contribution) through local independent banks and/or credit unions.

    I believe that this could also stimulate other business and additional deposits for smaller banks.

  5. DeDude says:

    The Banksters are Gangsters.

  6. Rick Caird says:


    There was not anything new in the list. The real problem is that government has done nothing about all this fraud and malfeasance. If there are no prosecutions, then there is no risk in continuing to do these same things. Until we get an administration that wants to put another Bill Black in, and wants to support him, everything coming out of the financial system is suspect.

    Instead, though, what we get is bailouts for the big banks and Dodd-Frank bill that punishes the community banks who were not much involved, if involved at all, in all the fraud and unethical conduct. We are punishing the wrong people.