Pilant's Business Ethics

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Tag: fraud

Disgraced Wyoming Horse Eater Admits Illegal Collusion (via Straight from the Horse’s Heart)

Disgraced Wyoming Horse Eater Admits Illegal Collusion (via Straight from the Horse’s Heart)

I’m going to side with the horses (and I don’t even like horses). I don’t think that butchering horses for their meat is a benefit to them.

Besides there is a heavy level of outrage in this particular posting. I very much admire the author’s passion and anger. I share it.

James Pilant

Disgraced Wyoming Horse Eater Admits Illegal Collusion (In My Most Outraged Opinion) by R.T. Fitch “Slaughterhouse” Sue Wallis Admits Access to Leaked Federal Document It does not take a rocket scientist to figure out the motives behind the defunct and degenerate Wyoming state Representative Sue Wallis’ motives to eat horses; it’s all about the money.  But we can live with that as she is not that m … Read More

via Straight from the Horse’s Heart

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Bank of America Forecloses on Santa Clara Woman After Telling Her to Miss Her Payments | | St. George News

008bBank of America Forecloses on Santa Clara Woman After Telling Her to Miss Her Payments | | St. George News

How many times do we have to read this same story? Telling someone that they have to stop paying to access a federal program, encouraging them to believe that they are going to get a loan modification, when your bank has already decided that no one is going to get this kind of deal, and then foreclosing on them when they fall for the bait – is this they way banks are supposed to make money?

What is the business ethics here? The bank should be telling its customers the truth, not a set of lies. I don’t think that requires much analysis.

Banks are a utility in the United States. That is, they have government protection in return for the bank following a set of rules. That’s why your accounts are insured and banks are supposed to be accountable. Because in a real sense a bank is public institution, it has privileges in the law to protect and profit it. How much less incentive should this kind of institution have than private companies from misleading and cheating its clients out of their homes?

Since, I wrote this article my own students have come forward with the same story of being told to miss payments by the bank and then being foreclosed on. There is great and calculated cruelty in these acts.

James Pilant

SANTA CLARA – Bank of America foreclosed on a Santa Clara woman’s home, despite her doing everything she was instructed to do in order to prevent it. Annette Lake resided in her house in Santa Clara from 1986 until May 24, 2011, when Bank of America foreclosed on her home. Just after her divorce from her husband was finalized in 2008, Lake was diagnosed with breast cancer. She was laid off from her job during chemotherapy treatments. She began ha … Read More


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on walking the walk. (via bee thousand)

on walking the walk. (via bee thousand)

How much to give? And who to give it to?

The eternal questions of those fortunate to have enough resources to give.

Here is a good discussion of a person trying to make the right charitable choices.

(In the United States, not getting your money diverted to private pockets when giving is very difficult. Scam artists masquerade under the sweetest and most persuasive names. They love names like veteran, children, etc. Be very careful who you give your money to and remember, the most important factor is what proportion of the charity’s contributions actually go to the charitable purpose. If you can’t find that out after a few minute web search, you are better off buying lottery tickets. In both cases your money is lost, but with the lottery, you know up front that your money is gone for no purpose.)

James Pilant

Special thanks to bee thousand.

So far, my dissertation research has consisted mostly in talking the talk but not yet walking the walk. But I’ve mulled over this for sort of a long time now and think I’ve finally come close to a decision regarding my participation in Peter Singer’s The Life You Can Save plan (which is tied to his work on charity, which is sort of a central focus of my dissertation research). The algorithm which Singer recommends is donating 1% of your annual in … Read More

via bee thousand

Control Fraud as White Collar Crime And William K. Black

 This is fascinating. Essentially William K. Black is modifying out concepts of White Collar Crime (The Lord knows it needs it!).

White collar crime is a concept still burdened by its original definition. These kinds of crimes are no longer centered on such things as embezzlement but on subverting entire nations.

Here Black explains what he means by the concept –

Here’s a fuller treatment by the author.

When Fragile becomes Friable: Endemic Control Fraud as a Cause of Economic Stagnation and Collapse

Individual “control frauds” cause greater losses than all other forms of property crime combined. They are financial super-predators. Control frauds are crimes led by the head of state or CEO that use the nation or company as a fraud vehicle. Waves of “control fraud” can cause economic collapses, damage and discredit key institutions vital to good political governance, and erode trust. The defining element of fraud is deceit – the criminal creates and then betrays trust. Fraud, therefore, is the strongest acid to eat away at trust. Endemic control fraud causes institutions and trust to become friable – to crumble – and produce economic stagnation.

Read More!

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Tri-State University Scandal, Small Story In The United States

There are two aspects of this story that I would like to talk about. The first that in the American media, this story is not front page news. It’s buried in the middle of the newspaper. The big coverage is in India.

The second thing I want to talk about is here – today, I read this. From DNA Daily News and Analysis based in Mumbai, India. –

The large-scale mushrooming of fake Indian agents working on behalf of lesser-known foreign universities are to blame (my emphasis) for students falling prey to fraudulent institutions like Tri-Valley University (TVU) in the US, say experts.

“This is sad but true. In India, we have no regulatory mechanism to monitor agents working for foreign universities. These agents work for lesser-known or fraud universities abroad and dupe Indian students. They mislead students into joining fake universities abroad like TVU in the US,” says Manjula Raman, a career counsellor and principal of Army Public School, Bangalore.

It required a great deal of effort for this scandal to happen. Yes, there were agents in India exploiting these students but the American tolerance for sham universities and colleges is the other half of the equation. One make the other possible.

I personally know of some sham schools. Most people here do. Colleges spring up with signs in store front windows and four room buildings. Usually some religious education designed to train you as a minister or get you a certificate for office work.

My suspicion is that overseas, one American college looks very much like another.

Agents in India are taking advantage of how the American educational works (or doesn’t work). But there were a good number of Americans involved as well.


I want the people responsible in India for these students’ plight to go to jail.

I also want the Americans defrauding these students to go to jail.

James Pilant

The Saga Of The Students From India And Tri-valley University Continues

Some of these students have had to wear ankle bracelets that electronically broadcast their location. I have a report that there were 18 students required to wear these and two of these have now been detained. Their appeal is unlikely to be heard until September. If you count the remainder of February, that is seven months wearing an ankle bracelet. What’s more it is long time to be in legal limbo, unable to attend another university or work.

This is from the Times of India

The Indian students duped by a fake university in the US face an uncertain future as their appeal is not likely to be heard in a court there before September.

The 1,555 students, mostly from Andhra Pradesh, feel they are being subjected to inhuman treatment by the US authorities for no fault of theirs. They want the Indian government to immediately come to their rescue and help them transfer to other US universities.

The families of the students are worried as the US authorities have tied radio monitors to their ankles and may deport them for violation of visa rules.

The dreams of the students to pursue higher education in the US came crashing last week after the Tri-Valley University in California was raided for helping foreigners to illegally obtain student visas.

This is a program from an Indian law firm in the United States explaining the situation.

The government of India has expressed concern. This is from the DAILYBHASKAR.in.

Voicing concern over the welfare of Indian students affected by the closure of a California-based university, India on Friday asserted that students had valid visas and conveyed to the US that they should be given chance to clarify their position.

The students hold valid visas, a senior official said here on Friday, adding that India is hopeful they will be given adequate opportunity to clarify their position.

“Our immediate concern is the welfare of students. We are in touch with US federal agencies,” a senior official said. India’s consul general in San Fransisco also is in touch with students, the official said.

I am concerned too. I have a link to an online petition. I want you to understand clearly. This is not a petition that says there should be no investigation or that further inquiries should not be made. The petition asks for fairness. How many of you can disagree with that?

America is a very strange place for foreign students, not quite like the television view. Justice should not be denied but some kindness and a full consideration of their rights is not too much to ask for.

If you want to sign an online petition to ask the State Department to treat these students fairly, you can go here.

To my readers outside the United States, you do not need to be an American citizen to sign this petition!

So, come in and help.

James Pilant

P.S. I’m getting some indications that the investigation is focusing on a relatively small number of students. There is no direct announcement of this, but I am an attorney. The “feel” of the case is wrong. If they considered all of the students guilty, they could have moved all of them to a detention camp, since that number of students would have suggested an international conspiracy. In the United States, you file against everybody possible and then you narrow it down. I “think” (remember this is just my feel for what is going on) that the authorities are trying to sort through the cases and the fact that there are so many agencies involved is slowing the process.

BOA: BAD BANK, BAD BANK, WORSE BANK (via Livinglies’s Weblog)


This is how I feel as well. It’s a good read. Be warned, he’s really upset. But so am I when I’m dealing with this issue.

Here is my writing on the same subject. You can see that I get passionate about foreclosures too.

Robo-Signing Foreclosure Freeze Update (via Foreclosureblues)

Lots of Links on the Foreclosure Fraud Crisis (via Rortybomb)

“We Can Either Have a Rational Resolution to the Foreclosure Crisis or We Can Preserve the Capital Structure of the Banks. We Can’t Do Both” (via Foreclosureblues)

Sheldon Whitehouse Weighs In On The Foreclosure Crisis

Third Way Comments on Foreclosure Fraud Policy in the Post-Ibanez Landscape (via Rortybomb)

Foreclosure Speed Made Loan Modifications Impossible

The Vast Majority Of Foreclosures Were Done Correctly?

In total, I have 46 posts about the mortgage crisis.

James Pilant

BOA: BAD BANK, BAD BANK, WORSE BANK COMBO Title and Securitization Search, Report, Documents, Analysis & Commentary Bank of America to Create Troubled Loans Unit BANK STILL ATTEMPTING TO KEEP FORECLOSURES A POLITICAL ISSUE AS LEGAL OPTIONS RUN OUT EDITOR’S NOTE: As for what this means for homeowners, it is obvious that BOA is trying to come up with some formula that will be politically acceptable the final result of which will still be that they will get hundreds of thousands o … Read More

via Livinglies’s Weblog

I’m Not The Only One Who Believes The Banks Don’t Have The Documents.

William K. Black and L. Randall Wray call for putting the Bank of America into receivership!

How about that! Seize the bank and the government go through their books to find out what’s really going on. That’ll stand some CEO’s hair on end. It might get their attention. I’d like to see that.

I’ve talked for the last several days about my suspicion now hardening into belief that the banks do not have proof of ownership tens of thousands of foreclosures. I am not the only one who believes that.


Nothing short of removing all senior officers who directed, committed, or acquiesced in fraud can be effective against control fraud. We repeat: Foreclosure fraud is the necessary outcome of the epidemic of mortgage fraud that began early this decade. The banks that are foreclosing on fraudulently originated mortgages frequently cannot produce legitimate documents and have committed “fraud in the inducement.” Now, only fraud will let them take the homes. Many of the required documents do not exist, and those that do exist would provide proof of the fraud that was involved in loan origination, securitization, and marketing. This in turn would allow investors to force the banks to buy-back the fraudulent securities. In other words, to keep the investors at bay the foreclosing banks must manufacture fake documents. If the original documents do not exist the securities might be ruled no good. If the original docs do exist they will demonstrate that proper underwriting was not done — so the securities might be no good. Foreclosure fraud is the only thing standing between the banks and Armageddon.

I can’t say it better.

James Pilant

Iraq Not Rebuilt – $Billions Wasted

Just wonderful! Of course, it’s not much of surprise, there were already news stories and photographs of disastrous building projects and corporate contractual malfeasance. But here we are, billions in the hole, no doubt costing American lives as the Iraqis looked around and waited for us to fulfill promises our private contractors had little intention of doing in the first place. As long as the money rolled who cared about results. Here’s the lead in from the AP report

A $40 million prison sits in the desert north of Baghdad, empty. A $165 million children’s hospital goes unused in the south. A $100 million waste water treatment system in Fallujah has cost three times more than projected, yet sewage still runs through the streets

As the U.S. draws down in Iraq, it is leaving behind hundreds of abandoned or incomplete projects. More than $5 billion in American taxpayer funds has been wasted — more than 10 percent of the some $50 billion the U.S. has spent on reconstruction in Iraq, according to audits from a U.S. watchdog agency.

That amount is likely an underestimate, based on an analysis of more than 300 reports by auditors with the special inspector general for Iraq reconstruction. And it does not take into account security costs, which have run almost 17 percent for some projects.

Rating Agencies Were Part Of The Disaster On Wall Street

If the rating agencies were key players in the financial mismanagement that destroyed eight million jobs and threatened the world’s economy, why are they not included in the financial reform bill now before the Senate? Alain Sherter wants to know why. So do I.

This is a report from “Now” – a PBS program. In this particular episode an insider from a credit rating agency explains what happened.

Here is Alain Sherter explaining more about this ratings disaster –

The ratings agencies business model is based on a flagrant conflict of interest — they’re paid by the firms whose credit they evaluate. That makes them vulnerable to pressure from investment banks and securities issuers, which naturally want a bullet-proof rating in order to attract investors.

In the years leading up to the housing bust, Moody’s, S&P and Fitch passed out AAA ratings like candy bars at Halloween. In mid-2007 and early 2008, with the real estate market in free-fall and mortgage delinquencies soaring, they suddenly started downgrading scads of formerly top-rated securities. In January of ‘08, for instance, S&P lowered ratings on more than 6,300 and 1,900 CDOs — in a single day. Then, the deluge. The bottom fell out of the secondary market for subprime loans, and the rest is history.

Without the credit rating industry giving triple A ratings to these risky investments, the tragedy that has engulfed and continues to damage the lives of so many Americans would not have been possible.

What are these people not being called on the carpet or prosecuted for conduct that seems to many observers to look very similar to fraud?

James Pilant

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