WHAT DID THE BIG BANKS DO WITH THE "TARP" FUNDS?

July 31, 2009

It was being described as "the brink of financial Armageddon" when America's largest banks and brokerages accepted billions of dollars in taxpayer money in late 2008 to rescue them from collapse. We now know that these financial concerns took advantage of loose governmental requirements for tracking the TARP funds and have now made a miraculous recovery.

The TARP funds were approved by Congress to allow the U.S. Treasury to purchase or insure up to $700 billion of "troubled" assets. "Troubled assets", in the legislation, were defined as "(A) residential or commercial mortgages and any securities, obligations, or other instruments that are based on or related to such mortgages, that in each case was originated or issued on or before March 14, 2008, the purchase of which the Secretary determines promotes financial market stability; and (B) any other financial instrument that the Secretary, after consultation with the Chairman of the Board of Governors of the Federal Reserve System, determines the purchase of which is necessary to promote financial market stability, but only upon transmittal of such determination, in writing, to the appropriate committees of Congress.

Not only were mortgages and securities related to mortgages the main target of the legislation, strangely they were the only "troubled assets" NOT addressed following release of the rescue funds. Instead, the money went to big banks and brokerage firms, insurance companies, hedge companies and pretty much anyone else to use for anything but distressed mortgages.

It is now being revealed by N.Y. Attorney General Andrew Cuomo that nine banks and brokerages such as Chase, Merrill Lynch, Citibank, and the Bank of America received $175 billion in TARP funds after claiming over $100 billion in 2008 losses. The banks involved have seen an amazing turnaround and are now reporting huge profits. It's just incredible what you can do with "free" money! The banks were so happy that Chase (Jamie Dimon CEO), who received $25 billion in "rescue funds", gave away $33 billion to executives as bonus payments. Merrill Lynch (Stan O'Neal and John Thain CEOs) received $27 billion and rewarded their genius execs with $3.6 billion in bonuses and now are part of Bank of America; Citibank (Vikram Pandit CEO), a recipient of $45 billion were so thrilled with their executive's performance that they threw bonuses worth $5.3 billion at these super financiers.

Getting the message? It was more important to further compensate the criminal bankers who conspired to bring down the real estate market, while manipulating the entire process, than to provide some assistance to distressed homeowners. Billions in bonuses to crooks while nothing to the victims of these bloodsuckers, even when funds were specifically targeted for that very purpose.

Unless Congress brings down the hammer on these CEOs, their henchmen, their Boards and the heads of companies further down the food chain (mortgage brokers/servicers, hedge funds, insurance companies), the American voters are going to show their displeasure at the next election opportunity. Bankers should also take note, because bloggers will be relentless in exposing the names of all of the players who have profited at the expense of homeowners and all taxpayers.

A full report from the Cuomo investigation is available at:

http://www.reuters.com/article/ousiv/idUSTRE49S85720081029

BANK OF AMERICA RIPPING OFF CUSTOMERS

July 15, 2009

We've received several disturbing reports concerning the Bank of America (BofA). Recently, this recipient of $25 billion in TARP funds, "rescue" money from tax paying Americans, has apparently begun an illegal and fraudulent program to re-open business and commercial accounts that were closed by the customer. BofA then attempts to charge the fraudulently-opened account for services (e.g., payroll, etc.) that the bank had provided when the account was open.

Of course the accounts have no funds since they had been appropriately closed by the customer, so BofA sends the fraudulently opened accounts to a collection agency. Once this has happened, all parties involved (i.e., BofA, collection agencies, etc.) begin the merry-go-round of denying responsibility and accountability. The former customer is never notified of this transaction by BofA, that is until they begin receiving harassing phone calls from bill collectors and demands for payment in the mail.

Now, taxpayers have had to bail-out these crooks in order to save their tails and in return they are trying to rob customers who tried to properly close their accounts handled by this behemoth. We are calling on the Senate Banking Committee, the FDIC, the Federal Reserve and State Attorneys General to investigate BofA in regards to their illegal activity.

These types of activities by banks must be stopped! They have failed their stockholders and Americans in general, requiring rescue TARP funds in order to stay in business. They cannot be allowed to perpetrate outright fraud on former customers.

Please Mr. Frank, initiate an investigation immediately!