Institutional Corruption

I’ve railed against the SEC numerous times in the past, most recently because of its failure to do anything about HFT, so-called High Frequency Trading, which is nothing more than a hacking attack on investors using electronic stock exchanges. As Karl Denninger says:

Any honest read of the securities laws, incidentally, leads pretty much anyone to conclude that this sort of pattern of conduct should be against the law. But when it’s profitable for a financial institution it suddenly becomes “not illegal”, you see, just like it wasn’t really illegal to robosign foreclosure documents despite that being perjury if you or I did it.

However, the SEC is back in the press for a new reason – it is alleged to have been covering up its past activities by illegally destroying documents.  As Matt Tabibi, who first shone the light on this most recent pile of squirming maggots, says:

For the past two decades, according to a whistle-blower at the SEC who recently came forward to Congress, the agency has been systematically destroying records of its preliminary investigations once they are closed. By whitewashing the files of some of the nation’s worst financial criminals, the SEC has kept an entire generation of federal investigators in the dark about past inquiries into insider trading, fraud and market manipulation against companies like Goldman Sachs, Deutsche Bank and AIG. With a few strokes of the keyboard, the evidence gathered during thousands of investigations – “18,000 … including Madoff,” as one high-ranking SEC official put it during a panicked meeting about the destruction – has apparently disappeared forever into the wormhole of history….

It goes without saying that no ordinary law-enforcement agency would willingly destroy its own evidence. In fact, when it comes to garden-variety crooks, more and more police agencies are catching criminals with the aid of large and well-maintained databases.

As far as I can tell, this agency is rotten to the core – simple incompetence is no longer acceptable as an explanation when a guilty conscience is driving a cover-up. Not only should it be closed down, there needs to be a criminal investigation – presumably by the New York State AG if no-one else. It is notable that the financial services industry has escaped any culpability for the recent financial meltdown, presumably by dint of the usual corruption of the legislative and executive branches of government.

What will it take for people to realize that The Party is their enemy and start the process of real change? Even though only 11% of Americans are satisfied with the way the country is being run, they still keep voting for The Party. Part of this of course, is that The Party has suborned the media, such that candidates like Ron Paul who might actually change things, are censored and thereby marginalized.

The pundits claim they are only censoring candidates who are “not electable”. But just as “not politically feasible” is code for “the powers-that-be don’t want it”, “not electable” simply means that the candidate would champion the interests of the little guy, and challenge the powers-that-be: the large defense contractors, the giant banks, big pharma or the mega-energy producers.

As Kara Miller notes, the media won’t cover Ron Paul:

because he doesn’t fit the media narrative. He’s anti-war and pro-small government …. Heavily influenced by each other, media outlets have sidelined Paul and embraced Bachmann ….

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