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“Wells Fargo, for instance, which has leeched $25 billion in bailout money, bought an inadvertently hilarious full-page ad in The Times to whine about the junkets to Las Vegas and elsewhere it was forced to cancel because of public outrage.” --- Maureen Dowd, NTimes
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Lou Dobbs Tonight
Monday, November 12, 2007
Mortgage giants Wells Fargo and Countrywide Financial are accused of slapping dubious fees on homeowners struggling to save their homes. With fewer new mortgages being written, these
companies appear to be leaning on these lucrative fees to stay profitable—with devastating consequences for homeowners. We’ll have that report.
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HOW MUCH OF THIS NATION’S MELTDOWN IS DUE TO BANKSTER CRIME?
AND THEY’RE STILL BUYING POLITICIANS, AND STILL RAKING IN MASSIVE PROFITS ON TOP OF THE NO-STRINGS WELFARE BAILOUTS THEY USED TO BUY OTHER BANKSTERS.
BOTH BANKSTERS WELLS FARGO and BANK of AMERICA ARE GENEROUS DONORS TO LA RAZA, THE MEXICAN FASCIST PARTY of AMERICA!
BOTH BANKS ILLEGALLY OPEN BANK ACCOUNTS FOR ILLEGALS.
BOTH BANKS HANDED OUT THEIR HIGHLY PROFITABLE MORTGAGE SCAMS TO ILLEGALS ILLEGALLY AND THEN DUMPED THAT PRODUCT ON UNSUSPECTING INVESTORS.
BOTH BANKS HAVE CAUSED MASSIVE FORECLOSURES AND THE PROFITED FROM THESE FORECLOSURES ON THE OTHER END.
BOTH BANKS OWN SEN. DIANNE FEINSTEIN, ONE THE MOST CORRUPT AND SELF-SERVING POLITICIANS IN AMERICAN HISTORY. SHE FRONTED FRO THEIR BANKSTER WRITTEN “BANKRUPTCY REFORM”, VOTED ON WITH BOXER, BIDEN, AND CLINTON. WHERE THERE’S A PO, THERE’S A BANKSTER BOUGHT HO!
WELLS FARGO IS THE BIGGEST BACKER OF PAY DAY LOAN SHARKS, WHICH PARTICULARLY VICTIMIZE ILLEGALS AND BLACK AMERICA!
IF YOU’VE BEEN IN SILICON VALLEY, YOU WON’T FIND AN AMERICAN BORN EMPLOYEE AT WELLS FARGO OR BANK of AMERICA. THEY’RE CHINESE AND INDIANS IMPORTED IN TO TAKE OUR JOBS!
THESE ARE MONSTER CRIMINAL ORGANIZATIONS! THE FACT THAT THEY’RE SERVICING NARCOMEX IS HARDLY SURPRISING!
United States banks' key role in Mexico's drug gangs and dirty money
By Michael Smith
Bloomberg News
Just before sunset on April 10, 2006, a DC-9 jet landed at Ciudad del Carmen, 500 miles east of Mexico City. As soldiers on the ground approached the plane, the crew tried to shoo them away, saying there was a dangerous oil leak. So the troops grew suspicious and searched the jet.
They found 128 black suitcases, packed with 5.7 tons of cocaine, valued at $100 million. The stash was supposed to have been delivered from Caracas to drug traffickers in Toluca, Mexican prosecutors later found. Law-enforcement officials also discovered something else.
The smugglers had bought the DC-9 with laundered funds they transferred through two of the biggest banks in the U.S.: Wachovia and Bank of America. This was no isolated incident. Wachovia, it turns out, had made a habit of helping move money for Mexican drug smugglers. Wells Fargo, which bought Wachovia in 2008, has admitted in court that its unit failed to monitor and report suspected money laundering by narcotics traffickers. The admission came in an agreement that Wachovia struck with federal prosecutors in March, and it sheds light on the role of U.S. banks in contributing to Mexico's violent drug trade.
Wachovia admitted it didn't do enough to spot illicit funds in handling $378.4 billion for Mexican-currency-exchange houses from 2004 to 2007. That's the largest violation of the Bank Secrecy Act, an anti-money-laundering law, in U.S. history — a sum equal to one-third of Mexico's current gross domestic product.
"Wachovia's blatant disregard for our banking laws gave international cocaine cartels a virtual carte blanche to finance their operations," says Jeffrey Sloman, the federal prosecutor who handled the case.
Since 2006, more than 22,000 people have been killed in drug-related battles. Among the dead are police, soldiers, journalists and ordinary citizens. The U.S. has pledged Mexico $1.1 billion in the past two years to aid in the fight against narcotics cartels.
Behind the carnage in Mexico is an industry that supplies hundreds of tons of cocaine, heroin, marijuana and methamphetamines to Americans. The cartels have built a network of dealers in 231 U.S. cities from coast to coast, taking in about $39 billion in sales annually, according to the Justice Department.
Twenty million people in the U.S. regularly use illegal drugs, spurring street crime and wrecking families. Narcotics cost the U.S. economy $215 billion a year — in overburdened courts, prisons and hospitals and lost productivity, the department says.
"It's the banks laundering money for the cartels that finances the tragedy," says Martin Woods, director of Wachovia's anti-money-laundering unit in London from 2006 to 2009. Woods says he quit the bank in disgust after executives ignored his documentation that drug dealers were funneling money through Wachovia's branch network.
"If you don't see the correlation between the money laundering by banks and the 22,000 people killed in Mexico, you're missing the point," Woods says.
Cleansing dirty cash
Wachovia is just one of the U.S. and European banks that have been used for drug- money laundering. For the past two decades, Latin American drug traffickers have gone to U.S. banks to cleanse their dirty cash, says Paul Campo, head of the financial-crimes unit of the U.S. Drug Enforcement Administration (DEA).
American Express Bank paid fines in 1994 and 2007 after admitting it had failed to spot and report drug dealers laundering money through its accounts. Drug traffickers used accounts at Bank of America in Oklahoma City to buy three planes that carried 10 tons of cocaine, according to Mexican court filings.
Federal agents caught people who work for Mexican cartels depositing illicit funds in Bank of America accounts in Atlanta, Chicago and Brownsville, Texas, from 2002 to 2009. Mexican drug dealers used shell companies to open accounts at London-based HSBC Holdings, an investigation by the Mexican Finance Ministry found.
Those two banks weren't accused of wrongdoing. Bank of America spokeswoman Shirley Norton and HSBC spokesman Roy Caple say laws bar them from discussing specific clients. They say their banks strictly follow the government rules.
A Mexican judge on Jan. 22 accused the owners of six money changers in Culiacán and Tijuana of laundering drug funds through their accounts at the Mexican units of Banco Santander, Citigroup and HSBC, according to court documents. The money changers are in jail while being tried. Citigroup, HSBC and Santander weren't accused of any wrongdoing. The three banks say Mexican law bars them from commenting on the case, adding that they each carefully enforce anti-money-laundering programs.
HSBC has stopped accepting dollar deposits in Mexico, and Citigroup no longer allows noncustomers to change dollars there. Citigroup detected suspicious activity in the Tijuana accounts, reported it to regulators and closed the accounts, Citigroup spokesman Paulo Carreno says.
On June 15, the Mexican Finance Ministry announced it would set limits for banks on cash deposits in dollars.
Mexico's drug cartels have become multinational criminal enterprises.
Some of the gangs have delved into other illegal activities such as gunrunning, kidnapping and smuggling people across the border, as well as into seemingly legitimate areas such as trucking, travel services and air-cargo transport, according to the Justice Department's National Drug Intelligence Center.
These criminal empires have no choice but to use the global banking system to finance their businesses, Mexican Senator Felipe Gonzalez says.
"With so much cash, the only way to move this money is through the banks," says Gonzalez, who carries a .38 revolver for personal protection. "I know this won't stop the narcos when they come through that door with machine guns," he says, pointing to the entrance to his office. "But at least I'll take one with me."
No bank has been more closely connected with Mexican money laundering than Wachovia.
After a 22-month investigation, the Justice Department on March 12 charged Wachovia, now owned by Wells Fargo, with violating the Bank Secrecy Act by failing to run an effective anti-money-laundering program.
Five days later, Wells Fargo promised in a Miami federal courtroom to revamp its detection systems. Wachovia's new owner paid $160 million in fines and penalties, less than 2 percent of its $12.3 billion profit in 2009.
Bank's regrets
If Wells Fargo keeps its pledge, the U.S. government will, according to the agreement, drop all charges against the bank in March 2011.
Wells Fargo regrets that some of Wachovia's former anti-money-laundering efforts fell short, spokeswoman Mary Eshet says. Wells Fargo has invested $42 million in the past three years to improve its anti-money-laundering program and has been working with regulators, she says.
"We have substantially increased the caliber and number of staff in our international investigations group, and we also significantly upgraded the monitoring software," Eshet says. The agreement bars the bank from contesting or contradicting the facts in its admission.
The bank declined to answer specific questions, including how much it made by handling $378.4 billion, including $4 billion of cash from Mexican exchange companies.
The Smurfs
Drug money moves back and forth across the border in an endless cycle. In the U.S., couriers take the cash from drug sales to Mexico — as much as $29 billion a year, according to U.S. Immigration and Customs Enforcement. They hide it in cars and trucks to smuggle into Mexico. There, cartels pay people to deposit some of the cash into Mexican banks and branches of international banks. The narcos launder much of what's left through money changers.
By law, the money changers have to demand identification from anyone exchanging more than $500. They also have to report transactions higher than $5,000 to regulators.
The cartels get around these requirements by employing legions of individuals, including relatives, maids and gardeners, to convert small amounts of dollars into pesos or to make deposits in local banks. After that, cartels wire the money to a multinational bank.
The people making the small money exchanges are known as Smurfs, after the cartoon characters.
"They can use an army of people like Smurfs and go through $1 million before lunchtime," says Jerry Robinette, who oversees U.S. Immigration and Customs Enforcement operations along the border in east Texas.
The U.S. Treasury has been warning banks about big Mexican-currency-exchange firms laundering drug money since 1996. By 2004, many U.S. banks had closed their accounts with these companies. Wachovia ignored warnings by regulators and police, according to the deferred-prosecution agreement.
One customer that Wachovia took on in 2004 was Casa de Cambio Puebla, a Puebla, Mexico-based currency-exchange company. Pedro Alatorre, who ran a Puebla branch in Mexico City, had created front companies for cartels, according to a pending Mexican criminal case against him.
A federal grand jury in Miami indicted Puebla, Alatorre and three other executives in February 2008 for drug trafficking and money laundering. In May 2008, the Justice Department sought extradition of the suspects, saying they used shell firms to launder $720 million through U.S. banks.
Puebla executives used the stolen identities of 74 people to launder money through Wachovia accounts, Mexican prosecutors say in court-filed reports.
"Wachovia handled all the transfers, and they never reported any as suspicious," says Jose Luis Marmolejo, a former head of the Mexican attorney general's financial crimes unit now in private practice.
It was the Puebla investigation that led U.S. authorities to the broader probe of Wachovia. On May 16, 2007, DEA agents conducted a raid of Wachovia's international banking offices in Miami. They had a court order to seize Puebla's accounts.
U.S. prosecutors and investigators then scrutinized the bank's dealings with Mexican-currency-exchange firms. That led to the March deferred-prosecution agreement.
With Puebla's Wachovia accounts seized, Alatorre and his partners shifted their laundering scheme to HSBC, according to financial documents cited in the Mexican criminal case against Alatorre.
In the three weeks after the DEA raided Wachovia, two of Alatorre's front companies, Grupo ETPB and Grupo Rahero, made 12 cash deposits totaling $1 million at an HSBC Mexican branch, Mexican investigators found.
The funds financed a Beechcraft King Air 200 plane that police seized on Dec. 29, 2007, in Cuernavaca, 50 miles south of Mexico City, according to information in the case against Alatorre.
Laundering money
For years, federal authorities watched as the wife and daughter of Oscar Oropeza, a drug smuggler working for the Matamoros-based Gulf Cartel, deposited stashes of $20 bills several times a day at a Bank of America branch in Brownsville, Texas, less than 3 miles from the border.
Bank employees got to know the Oropezas by the smell of their money.
"I asked the tellers what they were talking about, and they said the money had this sweet smell like Bounce, those sheets you throw into the dryer," says Tom Salazar, an agent who investigated the family. "They told me that when they opened the vault, the smell of Bounce just poured out."
Oropeza, 48, was arrested May 31, 2007, by police in Saraland, Ala., who stopped him on a traffic violation. Checking his record, they learned of the investigation in Texas.
They searched the van and discovered 185 pounds of cocaine hidden under a false floor. That allowed federal agents to freeze Oropeza's bank accounts and search his marble-floored home in Brownsville, Robinette says.
Inside, investigators found a supply of Bounce alongside the clothes dryer.
All three Oropezas pleaded guilty in U.S. District Court in Brownsville to drug and money-laundering charges in March and April 2008. Oscar Oropeza was sentenced to 15 years in prison; his wife was ordered to serve 10 months and his daughter got 6 months.
Bank of America's Norton says, "We not only fulfilled our regulatory obligation, but we proactively worked with law enforcement on these matters."
Banks aren't the only financial institutions that have turned a blind eye to drug cartels in moving illicit funds. Western Union, the world's largest money transfer firm, agreed to pay $94 million in February 2010 to settle civil and criminal investigations by the Arizona attorney general's office.
Undercover state police posing as drug dealers bribed Western Union employees to illegally transfer money, says Cameron Holmes, an assistant attorney general.
"Their allegiance was to the smugglers," Holmes says. "What they thought about during work was 'How may I please my highest-spending customers the most?' "
Workers in more than 20 Western Union offices allowed the customers to use multiple names, pass fictitious identifications and smudge their fingerprints on documents, investigators say in court records.
"In all the time we did undercover operations, we never once had a bribe turned down," says Holmes, citing court affidavits.
Western Union has made significant improvements, it complies with anti-money-laundering laws and works closely with regulators and police, spokesman Tom Fitzgerald says.
Copyright © The Seattle Times Company
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From the Los Angeles Times
'Blood wires' over the Mexican border
Wire transfers keep crime cartels and human smugglers in the money, officials say. Arizona's attorney general wants Western Union to cooperate more fully with investigations.
By Josh Meyer
June 8, 2009
Reporting from Phoenix — The bleeding body of Mexican immigrant Javier Resendiz Martinez was the first thing police noticed when they raided the bungalow on North 63rd Avenue here four years ago after reports of gunshots.
Soon afterward, however, they found payment logs of more than 100 wire transfers to Western Unions in the border town of Caborca, Mexico -- which state and federal officials cite as evidence that the financial services company and other money transmittersare used by Mexican crime syndicates to help facilitate the smuggling of people into the United States.
Arizona Atty. Gen. Terry Goddard said human smuggling has become a $2-billion-a-year business in his state alone, thanks in large part to what he calls "blood wires," the payments from family members, friends and employers to smugglers via Western Union and other companies.
Goddard and other Arizona officials have not accused Western Union of a crime. But in interviews and court documents they say the company consistently has rejected requests for cooperation, undermining efforts in Arizona to go after the crime cartels that control much of the increasingly violent trade in humans, drugs, weapons and laundered cash from their havens in Mexico.
Western Union spokesman Daniel Diaz called Goddard's accusations "erroneous and inflammatory."
The Colorado-based company works cooperatively with law enforcement agencies around the world to identify and prosecute illegal activity, said Peter Ziverts, its vice president for anti-money laundering. He said Western Union had instituted numerous reforms to detect illegal wire transfers, including far more aggressive oversight of its thousands of independent money-store operators.
Near the U.S. border, he said, the company caps the total amount that someone can transfer, but keeps the cap and the time frame secret to avoid tipping off smugglers. The company has filed more than 30,000 suspicious activity reports from Arizona, Texas and Mexico in the last year, he said.
"We cooperate . . . and we go over and above what we're required to do," Ziverts said.
Marcy M. Forman, who heads the investigative arm of the Department of Homeland Security's Immigration and Customs Enforcement division, said Western Union had cooperated on specific criminal investigations. "When we need information, we generally don't have a problem getting it," Forman said. "But ours is case specific. So that may be the difference."
Homeland Security Secretary Janet Napolitano, until recently Arizona's governor and its attorney general before Goddard, had no comment on Goddard's ongoing battles with Western Union.
"The general strategy of targeting drug cartels and [drug and human] smugglers by breaking their financial backbone was an approach Napolitano originated as state [attorney general] and has proved immensely successful at the state level," said a senior Homeland Security official, who spoke on condition of anonymity when discussing department thinking.
Goddard said that since he took office in 2003, Western Union had denied many of his formal demands for information on money transfers and refused to comply with warrants ordering the seizure of large volumes of suspicious payments -- especially those to Caborca and other smuggler strongholds in Mexico's Sonora state, just south of Arizona.
Western Union has argued in court that many of Goddard's demands are unconstitutionally broad and violate the privacy of its customers, many of whom are immigrants sending money home to Mexico. Some customers won't want to use Western Union if their money could be seized, it says, although it acknowledges that no transfers have been seized in Arizona in several years. The company also opposes the state's efforts to get access to the wire transfer data, calling that unconstitutional.
Some judges have agreed.
Last week, the Arizona Supreme Court ruled that Goddard had overstepped his authority in trying to seize records of wire transfers exceeding $500 from 29 other U.S. states to Sonora.
Western Union hailed the ruling. But Goddard, a likely candidate for governor, said the decision was narrowly focused and still would allow him to seize some of the payments if they were linked to human smuggling into those other states via Arizona.
He likens his request for the data to getting approval for a wiretap: The information helps authorities find suspicious patterns of activity, which they can use for further investigation and possible prosecution.
Goddard said that he was focusing on money transfers because, without them, the human smugglers would be out of business.
According to law enforcement officials, Mexican smugglers almost always do business in cash. But migrants pay most of the $2,000 or so fee when the trip is completed.
To ensure they get paid, smugglers hold their human cargo -- usually half dressed and under armed guard -- in a vast network of "stash houses" until the transfers come through. Then they whisk the migrants by van to their destinations around the nation.
Authorities say there are about 300 stash houses around Phoenix at any given time, each filled with dozens of immigrants. Hundreds more hideaways are scattered throughout the Southwest and in dozens of "corridor" states where the migrants end up.
After they reach the United States, many migrants are forced to pay two or three times the negotiated fee -- and may be assaulted, raped or killed if they object.
When Resendiz protested at the house on 63rd Avenue, he was given a phone and told to call his brother in Philadelphia. Officials said that, as his brother listened in, Resendiz, 36, argued with his captors and was executed.
Authorities contend that tracing the flurry of electronic payments that Western Union, MoneyGram and other firms process is vital to finding the smugglers and their stash houses.
Between 1999 to 2001, according to a sworn declaration from Daniel Kelly of the Arizona Financial Crimes Task Force, one group of smugglers laundered more than $10 million through Western Union.
Since 2003, the U.S. Treasury Department and Arizona have fined Western Union $6 million for willful failure to file suspicious activity reports and other violations. Authorities call that a significant disciplinary action.
"Our system wasn't nearly as robust as it is now," Ziverts said recently.
By 2005, Arizona officials said, their money seizures and enforcement efforts had reduced the flow of smuggling proceeds into the state by $600 million a year. The smugglers began having the money wired from other states directly to associates in Mexico.
That year, Western Union complied with an Arizona state subpoena to provide data for two months of wire transfers to Sonora.
Authorities found that in that short window, three suspected smugglers linked to the stash house where Resendiz was killed had picked up 161 wire transfers at a single Western Union in Caborca.
Only one of those payments had originated from Arizona, Kelly said -- further proof that state authorities needed broader seizure powers.
In all, $28 million flowed during that short period from other states into Western Unions in Caborca and other Sonora smuggling hubs.
So Goddard obtained a warrant to seize those suspicious payments too. Western Union refused to comply, and the impasse took three years to work its way through state courts.
Goddard and other state officials say the firm has not done enough to monitor questionable payments, institute safeguards, discipline incompetent and unscrupulous employees.
"Western Union has made every effort to prevent data disclosure and identification of criminal activity which we could be able to make from that disclosure," he said during a March Senate hearing.
Western Union disagrees. The company recently agreed to provide some of the data from other states.
But Goddard -- who has pressed for tougher federal laws and regulations to crack down on the smugglers -- said the firm had not done enough.
No other states, he said, systematically analyze and target suspected smugglers' wire transfers for prosecution, and neither does the U.S. or Mexican government. As a result, Arizona authorities said, their hunt for the smugglers will remain largely futile.
From the Los Angeles Times
HOUSING
NAACP suits claim African Americans were targeted for subprime mortgages
Subsidiaries of Wells Fargo and HSBC are accused of steering blacks into higher-price loans even if they qualified for better terms.
By E. Scott Reckard
March 14, 2009
The NAACP sued subsidiaries of two major banks Friday for allegedly steering African American borrowers unfairly into costly subprime mortgages.
The suits -- against Wells Fargo Bank and Wells Fargo Home Mortgage Inc., owned by Wells Fargo & Co., and against HSBC Mortgage Corp. (USA) and HSBC Bank USA, owned by HSBC Holdings -- arrive at a time when the housing crisis and soaring unemployment already are causing disproportionate harm in black neighborhoods, leaders of the rights group said.
The lawsuits, filed in U.S. District Court in Los Angeles, add to a long list of lenders that the National Assn. for the Advancement of Colored People has accused of "systematic, institutionalized racism" in litigation that began in 2007.
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