Translated from the French by Tim Gupwell
Idea association being an excellent means of investigation… here is a reminder of this article dating from 26th March 2010.
Everybody knows the history of Al Capone, who was never caught by the American state for his racketeering activities but was brought down by an investigation for tax evasion. One also knows that the American banks have made life difficult for the authorities since they have attempted to put back a bit of order into a sector which has triggered an unprecedented crisis in the entire capitalist system. At the same time you read with interest a story from the Bloomberg agency entitled JPMorgan, Lehman, UBS Named as Conspirators in Muni Bid-Rigging, or in other words (to put it more explicitly), “J.P. Morgan, Lehman Brothers, UBS designated as co-conspirators in sham auctions for the municipal bond market”.
If you read the article you will notice that the title of the story only names the main culprits. Other names on the list include Bank of America, Bear sterns, Société Générale, General Electric and Salomon Smith Barney – which used to belong to Citigroup. Wachovia, which has since been bought up by Wells Fargo is also mentioned, as is Financial Security Assurance Holdings Ltd., a bond insurer which was formerly a subsidiary of Dexia.
The co-conspirators named in the indictment, which was brought under criminal anti-trust law, participated in sham auctions which were organized by a company called Financial Products Inc. The victims of these deceptive practices included local communities, towns, states, and school districts, who received artificially low interest rates on their investments known as ‘guaranteed investment contracts”, a market which accounts for 2.8 trillion dollars. The co-conspirators were paying kickbacks to CDR in exchange for favourable investment deals.
Charges have not yet been brought but it seems highly likely that the passing of new regulations on financial activities in the United States will suddenly become a lot easier.