The Banks are Still Ripping us Off
Just last week Citigroup settled charges (without admitting or denying guilt) that it defrauded investors by selling them a package of mortgage-backed securities rife with mortgages it knew were likely to default, but didn’t disclose the hazard. It then bet against the package for its own benefit — earning fees of $34 million and net profits of at least $126 million. [Robert Reich]
They paid a paltry $285 million in penalties.
That’s nothing near as awful as B of A transferring their failing speculation commodities to their retail section because it’s FDIC insured; in other words, you and I have to pay up when their bad bets go sour.
The American banking industry is ruled by just a handful of banks so we’re still in an era of TOO BIG TO FAIL.