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Countrywide/Bank of America whistleblower practically begs for subpoena, Obama DOJ indifferent

Steam erupts as a train whistle blows.

The continued war on whistleblowers (Photo: Ben Salter / Flickr).

I ran across this posting in Rolling Stone from a management-level whistleblower, who provided information about frauds which took place at Countrywide Home Loans and Bank of America. The author has prevailed in a wrongful termination ruling from OSHA that requires Bank of America to reinstate her and pay significant damages. The whistleblower writes:

In 2010, I was interviewed by the Financial Crisis Inquiry Commission (FCIC) and offered evidence of systemic fraud. Other whistleblowers have done the same. The Commission’s report concluded that fraudulent actions were systemic in certain financial institutions, and referred these practices to federal authorities. Not a single successful criminal prosecution has resulted. President Obama’s DOJ claims that prosecutors can’t indict and convict financial executives just because they behaved badly; greed, they say, is not a crime. Together with other FCIC witnesses, however, I alleged fraud, not greed, and that is a crime. The DOJ needs to investigate our allegations, and prosecutors could start by contacting whistleblowers like me. We have a lot to say, but many of us are gagged by our former employers unless subpoenaed. Today, millions of Americans are paying more on their mortgages than their homes are worth, and millions more are facing foreclosure. Meanwhile, those who cashed in while ordinary Americans lost their homes and their jobs remain at large, continuing both the crimes and the cover-up. Whistleblowers like me know who they are because we were there. We’re willing to talk. Why won’t the government listen?

There are people with knowledge of serious crimes that want to come forward and help the justice system to set things right. But there is a piece missing:

The Obama administration plans to add thousands of investigators to enforce the health care reform law, but has added just 25 positions to investigate whistleblower claims.

The Obama administration does not seem interested in what whistleblowers are reporting, nor does it seem all that interested in protecting whistleblowers that can provide valuable information to prosecutors. If the Obama administration was paying attention, they would find that public disappointment with the lack of significant and aggressive prosecutions of the serious frauds that caused our financial crisis has spread far beyond the Occupy movement and has now entered the jury pool. In a recent SEC prosecution of a Citigroup employee, the jury had some interesting thoughts:

As Beau Brendler sat in the jury box listening to the government’s case against a former Citigroup midlevel executive, the same question kept entering his mind. “I wanted to know why the bank’s C.E.O. wasn’t on trial,” said Mr. Brendler, who served as the jury’s foreman. “Citigroup’s behavior was appalling.”

So, despite the fact that the jury found that the SEC had failed to prove its case against the midlevel employee, in an unusual act for a jury, they issued a statement along with their verdict:

“This verdict should not deter the S.E.C. from continuing to investigate the financial industry, review current regulations and modify existing regulations as necessary.”

The jury foreman explained their reasoning this way:

“We were afraid that we would send a message to Wall Street that a jury made up of regular American folks could not understand their complicated transactions and so they could get away with their outrageous conduct,” Mr. Brendler said. “We also did not want to discourage the government from investigating and prosecuting financial crimes.”

There is a thirst for justice in the American public. It is long past time for the Obama administration to demonstrate that they are on the side of regular Americans and do something. Let’s see, there’s big money on one side of this issue and votes on the other side. What’s a politician to do? Probably nothing if their approach to other institutions based upon the FCIC investigation is the same as their negligent disinterest inapproach to Goldman Sachs:

The Justice Department has decided it will not prosecute Goldman Sachs or its employees for their role in the financial crisis, following an investigation by senators Carl Levin (D-MI) and Tom Coburn (R-OK). The congressional investigation found problems with the credit rating agencies and poor oversight from regulators, and highlighted abuses by Goldman Sachs and other large investment banks. Senator Levin sent a formal referral to the Justice Department for a criminal investigation in April 2011. The investigative report by the Senate’s Permanent Subcommittee on Investigations, chaired by Levin, found that Goldman Sachs “used net short positions to benefit from the downturn in the mortgage market, and designed, marketed, and sold CDOs in ways that created conflicts of interest with the firm’s clients and at times led to the bank’s profiting from the same products that caused substantial losses for its clients.” A statement from the Justice Department issued late on Thursday evening noted, “Based on the law and evidence as they exist at this time, there is not a viable basis to bring a criminal prosecution with respect to Goldman Sachs or its employees in regard to the allegations set forth in the report.”

I wonder if the sound of the revolving door, clanking in the night, keeps them awake at the White House.

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joe shikspack

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