Matt Taibbi and Bank Whistleblower on How JPMorgan Chase Helped Wreck the Economy, Avoid Prosecution
Topics
Guests
Alayne Fleischmann,
JPMorgan Chase whistleblower. She was a deal manager at the
bank, where she says she witnessed "massive criminal securities fraud"
in its mortgage operations during the period leading up to the financial
crisis.
Matt Taibbi,
award-winning journalist with Rolling Stone magazine. His latest article is headlined "The $9 Billion Witness." He is author of the book The Divide: American Injustice in the Age of the Wealth Gap.
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A year ago this month the U.S. Department of Justice announced
that the banking giant JPMorgan Chase would avoid criminal charges by
agreeing to pay $13 billion to settle claims that it had routinely
overstated the quality of mortgages it was selling to investors. But how
did the bank avoid prosecution for committing fraud that helped cause
the 2008 financial crisis? Today we speak to JPMorgan Chase
whistleblower Alayne Fleischmann in her first televised interview
discussing how she witnessed "massive criminal securities fraud" in the
bank’s mortgage operations. She is profiled in Matt Taibbi’s new Rolling
Stone investigation, "The $9 Billion Witness: Meet the woman JPMorgan
Chase paid one of the largest fines in American history to keep from
talking."
Transcript
This is a rush transcript. Copy may not be in its final form.
JUAN GONZÁLEZ: A
year ago this month, the Justice Department announced the banking giant
JPMorgan Chase would avoid criminal charges by agreeing to pay $13
billion to settle claims that it had routinely overstated the quality of
mortgages it was selling to investors. When the toxic mortgage
securities started turning bad, investors lost faith in the banking
system, and a housing crisis turned into the 2008 financial crisis that
led to millions of home foreclosures. New York Attorney General Eric
Schneiderman unveiled the settlement last November.
ATTORNEY GENERAL ERIC SCHNEIDERMAN: Not only will Chase have to pay the largest settlement ever levied against a financial institution, but it has admitted in our statement of facts that its own employees, employees of Bear Stearns and employees of Washington Mutual made material misrepresentations to the investing public about a large number of residential mortgage-backed securities that they issued prior to the crash in 2008. This settlement is a major victory in the fight to hold accountable those who were responsible for that crash.
AMY GOODMAN:
Soon after the JPMorgan Chase deal was reached, U.S. Attorney General
Eric Holder discussed the bank’s misdeeds during an interview with NBC News’ Pete Williams.
ATTORNEY GENERAL ERIC HOLDER: It packaged loans that it knew did not pass its own stated due diligence test. We have a whistleblower who indicated that she expressed concerns about what the strength of these mortgage-backed securities were, and they put them out there to the market and said that they were perfectly fine, when in fact they were not.
PETE WILLIAMS: So, to be clear, you’re saying that JPMorgan’s conduct here contributed to the housing collapse?
Show Full TranscriptATTORNEY GENERAL ERIC HOLDER: Not only the conduct of JPMorgan, it was the conduct of other banks doing similar kinds of things that led directly to the collapse of our economy in 2008 and in 2009.
http://www.nakedcapitalism.com/…/matt-taibbi-alayne-fleisch…
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