There is something that I find disturbing about the recent revelations involving Lance Armstrong. In their piece written for Sports Illustrated, Alexander Wolff and David Epstein pour over "164 pages punctuated by chilling detail, and more than 850 pages of addenda and documentary evidence". The piece details testimony obtained from many different witnesses from many different walks of life who filled many different roles in Lance Armstrong's life and his doping.
"A Massive Fraud Now More Fully Exposed" is based mostly on sworn testimony obtained by federal officials. A lot of investigative work went into getting to the truth behind Lance Armstrong's doping allegations, which lead to Armstrong feeling the consequences for his actions. Why is this kind of effort not being put into investigating the alleged crimes committed by the people responsible for the banking crisis in 2008? Why has no one responsible for the banking crisis been convicted, or even brought to trail?
In a September 3, 2012 piece written for Rolling Stone, Matt Taibbi detailed the disparity in the resources put into investigations made involving banking officials and athletes. Quoting from the piece:
The government assigned 93 agents to the Clemens case, who collectively interviewed 179 individuals in 68 locations and produced a total of 235 reports. The mortgage task force? It was stuck at “about 50 or 60″ attorneys for much of the year, according to insiders – and many of those first staffers were provided by smaller federal agencies like the Consumer Financial Protection Bureau.
Did this story make much of a dent in the national narrative about these investigations? No. Did the Department Of Justice make any corrections to close this disparity? No.
On April 27, 2012, before Matt Taibbi's story was written, 60 Minutes did a piece where they detailed fraud perpetrated by the CEO of Lehman Brothers before it's collapse. 60 Minutes told of how Richard Fuld signed documents asserting that Lehman Brother was a financially sound organization, assertions which he knew to be false. This action by Richard Fuld was not only fraudulent, it was a crime, a violation of Securities and Exchange Commission policy. Did this story make much of a dent in the national narrative about Lehman Brothers? No. Did the Department Of Justice take action in response to this story? No.
On March 1, 2009, 60 Minutes did a story about Harry Markopolos. Harry Markopolos on several different occasions warned the SEC about investments made by Bernie Maddoff, warning that the SEC did nothing with. In fact, as this story details, the SEC didn't find out about Bernie Maddoff's ponzie scheme untill the scheme was on the verge of collapse and Bernie Maddoff told officials of his crime. Did this story make much of a dent in the national narrative about Bernie Maddoff? No. There are people who still think that the SEC busted Maddoff, when it was Bernie Maddoff who dropped the dime on himself.
Recently, the Curt Schilling headed 38 Studios collapsed in a way that directly affected the public. 38 Studios received loans from the state of Rhode Island, loans that it defaulted on. The studio collapsed, causing 309 people to lose their jobs. Not only that, several of the people who lost their jobs found out that they had more outstanding debt than they thought they did. As a part of hiring people to work on it's projects, 38 Studios offered help with moving expenses to perspective employees. This help included taking on the home loans of several employees. 38 Studios promised that they would sell the homes on behalf of the employee so that the employee could buy new homes near their new jobs. As it turns out, they didn't. Several of the people who had previously been employed with 38 Studios not only found themselves out of a job but also drowning in debt. On September 30, 2012, it was announced that no criminal charges would be filed in relation to the 38 Studios collapse. Did the collapse of 38 Studios, the unfulfilled promises they made to taxpayers and employees, and the regulators inability to find anything worthy of a criminal prosecution make a dent in the national narrative about corporate culture in this country? No. Did the Department Of Justice learn a lesson from the regulatory failures of the banking collapse? Clearly no.
There is something wrong with this situation. Corporations have and continue to commit fraud. Ordinary people continue to take it on the chin when corporations commit fraud, costing the ordinary consumer money and jobs. Regulators, politicians, and business leaders vow to make changes to prevent situations like this from happening. But they still happen. They keep on happening. The situation never seems to change. What's worse, people aren't demanding that it does change. They just put their hopes in the same people who have promised to make the changes they want, who then fail to do so. Why? Why aren't people up in arms about this? Why aren't people outraged about this? Why aren't people doing anything about this?
Sure, we had the Occupy protests, some of which continue on to this day, but those protests weren't organized around a single goal. All the Occupy protests amounted to was a bunch of people sitting in the park talking about how things sucked without actually doing anything to make it not suck.
Change needs to be made. The people who commit financial fraud don't need to be brought to justice, the customers who made committing fraud such an appealing proposition need to not do business with fraudsters and thieves. We need to look at the people we do business with and see if they are good honest people before we do business with them. We cannot count on those who commit financial fraud to be brought to justice We have seen through the regulators actions that the people who are tasked to enforce the rules are more interested in pursuing athletes, who's financial impact on out society is minuscule compared to people who commit financial fraud.
We have a power as customers in financial matters. Let's put that power to work.
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