by Richard Lawless
May 29, 2016
STEALING US BLIND
TEMECULA, Calif. -- When a little boy is denied access to the little girlís room, within 24 hours the DOJ is holding press conferences and filing lawsuits. But when billions are stolen in broad daylight, nothing happens.
Over 7 months ago, I starting making reports to the FBI and DOJ about an organized criminal enterprise that has stolen tens of billions from the American people. The evidence is overwhelming and the crimes are well documented. The FBI and DOJ turned a blind eye to it all.
It is pretty simple: Bankrupt municipal entities issue bond debt they know they canít repay, and then they go to the ratings agencies (Fitch, Moodyís and Standard & Poor's), who are willing to issue good credit ratings for the right fee.
Most of Wall Streetís biggest banks were willing to sell this worthless paper to unsuspecting investors, again for the right fees. All parties were fully aware this debt could not be repaid.
How do we know all this? Easy: We interviewed the executives at the municipal entities. They testified under oath that the ratings agencies and banks knew they were technically bankrupt, but agreed to issue good ratings and sell this worthless debt for the right fees.
We didnít stop there. We did financial audits of these bond offerings. Not only did we confirm they were bankrupt, but we found hundreds of millions in missing public funds in many of the financials we reviewed.
Tens of billions in phony debt and literally a billion dollars a year in missing public funds was discovered just one of the many entities we looked at.
We have municipal entities working with the rating agencies and banks to steal billions from the American public. It is a criminal enterprise. Out of frustration, two private parties filed their own organized crime charges under RICO. They were challenged and upheld in the courts.
In terms of jurisdiction, residents in all 50 states have taken losses under this on-going scheme.
This Ponzi scheme came to light with the collapse of Puerto Rico: No new money comes in and the house of cards collapses. Congress has a solution: pass legislation that prevents the bondholders from suing and make sure the innocent bond-holders take more losses to make this all go away.
The Governments position: No matter what, do not hold the municipal bond rating agencies or the banks (AKA the criminals) responsible.
Some 80 percent of these bonds were held by senior citizens and savers. The Government feels they should be punished and not the people who were running this scam. God help this countryÖThere are no honest people left in Congress or the DOJ.
Richard Lawless is the former Chief of Operations for Europe and Africa of the U.S. National Security Agency. He lives in Temecula, Calif.