If you are angry at what the bank executives are getting away with in the banks too big to fail, and think that Wall Street is corrupt, you may wonder if our government is also entirely corrupt because it would seem they’re letting these sharpsters get off scot-free.
But everyone in government isn’t corrupt, nor even everyone who works for a bank or Wall Street… well, let’s give them the benefit of the doubt.
The people do have some recourse by applying the Racketeer Influenced and Corrupt Organizations Act, known more simply as RICO. Anyone can find out more about RICO by looking it up in Wikipedia, but I’ll summarize it briefly. Criminal organizations can be prosecuted in civil court under RICO, a U.S. federal law that allows for leaders of a syndicate to be tried for crimes which they ordered others to do or in some way assisted them to carry out their crimes.
It focuses on patterns of behavior as opposed to criminal acts. When Congress investigated BCCI (also known as the Bank of Criminals and Crooks International) on charges of corruption and shut it down in 1991, apparently it was unable to pin down the details of criminal acts sufficiently enough to prosecute anyone. If RICO had been used to prosecute BCCI then, perhaps we wouldn’t have the massive banking problems that we have today.
The same banks seem to be involved in a pattern of wrongdoing.
When Carlyle Capital suddenly went bankrupt on March 17, 2008, its lenders were UBS, Merrill Lynch, Lehman Brothers, JPMorgan Chase, ING, Deutsche Bank, Credit Suisse, Citigroup, BNP Paribas, Bear Stearns, Banc of America and Calyon, according to its annual report.
Six major banks and investment firms which were overextended in the derivative market lost large trillions of dollars in derivatives when Carlyle Capital defaulted on its debts:
JPMorgan Chase – $88 trillion in derivatives
Bank of America – $38 trillion in derivatives
Citibank – $32 trillion in derivatives
Goldman Sachs – $30 trillion in derivatives
Wells Fargo-Wachovia Bank – $5 trillion in derivatives
Britain’s HSBC Bank – $3.7 trillion in derivatives
An expert on RICO, G. Robert Blakey, a professor at The Law School at the University of Notre Dame, was quoted in the Wikipedia article as saying that Congress never intended it [RICO] to merely apply to the Mob. He once told Time, “We don’t want one set of rules for people whose collars are blue or whose names end in vowels, and another set for those whose collars are white and have Ivy League diplomas.”
So there it is, folks. We don’t have to be victims of Wall Street and big banks whose racketeering, shell games and corruption are destroying our middle class. We have recourse. There are class action suits against these banks involved in mortgage-backed securities fraud. And then there’s RICO. RICO matters.