The Empire 319

'Wall Street's Bad Boys and Their Washington Enablers
Banksters Gone Wild
By PAM MARTENS

Imagine you moved in next door to a mischievous child. Over the years, you watched the parents scold ever so lightly as the deviant behavior grew from stealing loose change to petty larceny to bank robbery. You knew for sure the child would eventually get caught and end up in prison; but you didn't count on one thing: the parents used their political clout with each ratcheting up of the crimes to avoid prosecution, effectively turning the overseers of the public interest into criminal enablers. As the enablers "fixed" the outcome of each crime, they also sealed the records from public view and historical perspective.
That scenario typifies how criminal behavior has exploded on Wall Street and why President Bush, Congress and the regulators are stumbling around in the dark looking for cures for a financial crisis that they can neither understand nor contain: they're enablers in denial.Nothing more dramatically illustrates the criminal contagion than the fact that for the second time in 13 years, Orange County, California has found Wall Street toxic sludge threatening its public funds.
Here's what happened the first time around: a Merrill Lynch stockbroker, Michael Stamenson, sold billions of dollars of complex securities to Orange County, which ran a pooled investment fund for close to 200 cities and school districts in the county. The county lost $1.7 billion when the highly leveraged fund imploded, the county filed bankruptcy, resulting in serious job losses and cutbacks in social services to the poor. In all, Merrill made approximately $100 million in fees with Stamenson collecting $4.3 million in just the two-year period of '93 and '94.
Stamenson was immortalized in evidence produced in court as the star of a Merrill Lynch training tape for rookie brokers where he maps out the road to success on Wall Street: '' the tenacity of a rattlesnake, the heart of a black widow spider and the hide of an alligator.''
As the evidence against Stamenson and higher ups at Merrill played out in court, Merrill Lynch continued to pay annual compensation of $750,000 to Stamenson and eventually settled the case for $400 million and sealed the documents. It also paid $30 million to the county to settle and abruptly end a grand jury investigation, leading to loud cries of foul play. Once again, the documents and testimony were sealed from public view. This is what consistently happens on settlement when a customer or employee attempts to sue a Wall Street firm and is ushered instead into a Wall Street Star Chamber called mandatory arbitration.'

Lees verder: http://www.counterpunch.org/martens12072007.html