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Preface: Not all banks are criminal enterprises. The wrongdoing of a particular bank cannot be attributed to other banks without proof. But – as documented below – many of the biggest banks have engaged in unimaginably bad behavior.



You Won’t Believe What They’ve Done …

Here are just some of the improprieties by big banks:

Financing illegal arms deals, and funding the manufacture of cluster bombs (and see this and this) and other arms which are banned in most of the world

Launching a coup against the President of the United States

Handling money for rogue military operations

Engaging in mafia-style big-rigging fraud against local governments. See this, this and this

Shaving money off of virtually every pension transaction they handled over the course of decades, stealing collectively billions of dollars from pensions worldwide. Details here, here, here, here, here, here, here, here, here, here, here and here

Artificially suppressing gold prices

Pledging the same mortgage multiple times to different buyers. See this, this, this, this and this. This would be like selling your car, and collecting money from 10 different buyers for the same car

Cheating homeowners by gaming laws meant to protect people from unfair foreclosure

Committing massive fraud in an $800 trillion dollar market which effects everything from mortgages, student loans, small business loans and city financing

Manipulating the hundred trillion dollar derivatives market

Engaging in insider trading of the most important financial information

Pushing investments which they knew were terrible, and then betting against the same investments to make money for themselves. See this, this, this, this and this

Engaging in unlawful “frontrunning” to manipulate markets. See this, this, this, this, this and this

Engaging in unlawful “Wash Trades” to manipulate asset prices. See this, this and this

Otherwise manipulating markets. And see this

Participating in various Ponzi schemes. See this, this and this

Charging veterans unlawful mortgage fees

Helping the richest to illegally hide assets

Bribing and bullying ratings agencies to inflate ratings on their risky investments

The executives of the big banks invariably pretend that the hanky-panky was only committed by a couple of low-level rogue employees. But studies show that most of the fraud is committed by management.

Indeed, one of the world’s top fraud experts – professor of law and economics, and former senior S&L regulator Bill Black – says that most financial fraud is “control fraud”, where the people who own the banks are the ones who implement systemic fraud. See this, this and this.

But at least the big banks do good things for society, like loaning money to Main Street, right?

Actually:

The big banks no longer do very much traditional banking. Most of their business is from financial speculation. For example, less than 10% of Bank of America’s assets come from traditional banking deposits. Instead, they are mainly engaged in financial speculation and derivatives. (and see this)

The big banks have slashed lending since they were bailed out by taxpayers … while smaller banks have increased lending. See this, this and this

And our democracy and republican form of government as well

We can almost understand why Thomas Jefferson warned:

And I sincerely believe, with you, that banking establishments are more dangerous than standing armies ….

John Adams said:

Banks have done more injury to religion, morality, tranquillity, prosperity, and even wealth of the nation than they have done or ever will do good.

And Lord Acton argued: