Banks sued for alleged Libor manipulation...AND THEY'RE ALL OBAMA DONORS!!!
The federal regulator of credit unions is suing 13 banks for the alleged manipulation of an international standard used to set rates on mortgages, car loans, student loans and credit cards.
The National Credit Union Administration lawsuits charge that the banks conspired to rig Libor, the daily London Interbank Offered Rate that's used to set the rates on mortgages, car loans, student loans, credit cards and complex financial derivatives contracts.
By keeping the rate artificially low from at least January 2005 through December 2010, the alleged manipulation resulted in improperly low interest income for five failed corporate credit unions now being liquidated by the regulator. They are U.S. Central, Western Corporate, Members United, Southwest Corporate and Constitution Corporate, according to the 72-page complaint filed Monday in Kansas federal court.
Simultaneously, the alleged rate-rigging provided a secret and improper boost to the banks' own financial trading positions, "allowing them to earn significant undeserved profits," the complaint charged.
Because the banks' Libor quotes were an indicator of their financial health, the alleged manipulation also enabled them "to portray themselves to the marketplace as financially healthier and more liquid than they actually were," the lawsuit charged.
"We have a responsibility to pursue recoveries through every available avenue against those who caused billions of dollars in losses to credit unions," said NCUA Board Chairman Debbie Matz in a statement announcing the lawsuits. "Some firms were manipulating international interest rates in a way that cost the five corporates (credit unions) to lose millions of dollars."
Corporate credit unions provide services such as check clearing, electronic payments and investments to retail credit unions, which serve individual consumers.
The new legal actions join more than 40 other lawsuits filed against the banks over the alleged manipulation. Spokesmen for JPMorgan Chase, Barclays and Credit Suisse declined to comment on the lawsuits Tuesday. Other banks sued by the credit union regulator could not immediately be reached.
Separately, investigators in the U.S., United Kingdom, Switzerland, Japan, Canada, the European Union and Singapore are probing the suspected rigging. Authorities have so far netted about $2.5 billion in fines from UBS, Royal Bank of Scotland and Barclays, three of the banks charged in the credit union lawsuit.
Thomas Hayes, a former Citigroup and UBS trader suspected as a key figure in the manipulation, was hit with criminal charges in June by British authorities. Court-filed wiretap excerpts in a U.S. action against Hayes depict traders at several banks using e-mails and instant messages to broker changes in daily Libor rates that would boost trading positions for them and their banks.
Any recoveries from the new lawsuits will be used to reduce the total losses of the failed corporate credit unions.
Separately, the NCUA also announced it had filed lawsuits against Goldman Sachs, Morgan Stanley, Bear Stearns and six other banks for the sale of allegedly faulty mortgage-backed securities to two failed credit unions.
Filed in New York federal court, those lawsuits allege that offering documents for the securities contained "untrue statements and omissions" that made them "significantly riskier than represented."
On fifth anniversary of Wall Street crash, Obama tries the Big Lie technique
17 September 2013
On Monday, US President Barack Obama marked the fifth anniversary of the Wall Street crash of September 15, 2008 with a White House speech that only underscored the unbridgeable chasm that separates the entire political establishment from the broad mass of working people.
Forbes magazine reported that the wealth of the 400 richest Americans had climbed to $2 trillion, a jump from $1.7 trillion in 2012.