[Congressional Record (Bound Edition), Volume 157 (2011), Part 14]
[House]
[Pages 19100-19101]
[From the U.S. Government Publishing Office, www.gpo.gov]




                       WALL STREET AND MF GLOBAL

  The SPEAKER pro tempore. The Chair recognizes the gentlewoman from 
Ohio (Ms. Kaptur) for 5 minutes.
  Ms. KAPTUR. Mr. Speaker, numerous stories have come out over the last 
few weeks, all detailing the corruption and outright fraud on Wall 
Street.
  First, there was the recent news about former Secretary of the 
Treasury Hank Paulson's inappropriately tipping off a few key friends 
from Goldman Sachs and other Wall Street tycoons about the impending 
collapse of Fannie Mae and Freddie Mac so that those friends could 
hedge and make money on that insider knowledge. Then a judge in New 
York threw out one of the orchestrated settlements between Citigroup, 
which was a bank at the center of the wrongdoing, and the Securities 
and Exchange Commission, which allowed that bank to walk away from 
cases of fraud without admitting any wrongdoing.
  This past weekend, ``60 Minutes'' interviewed a former executive vice 
president at Countrywide Financial, a giant and duplicitous player in 
the U.S. mortgage business. This woman was in charge of fraud 
investigations at the company before the financial crisis.
  According to her, ``Countrywide loan officers were forging and 
manipulating borrowers' income and asset statements to help them get 
loans they weren't qualified for and couldn't afford.'' She went on to 
say that all of the recycle bins, wherever they looked in that company, 
were full of signatures that had been cut off of one document and put 
onto another and then photocopied or faxed. According to her, the fraud 
she witnessed was systemic, taking place in Boston, Chicago, Miami, 
Detroit, Las Vegas, Phoenix, and elsewhere. She was fired before she

[[Page 19101]]

could speak to government regulators about the extent of fraud she had 
documented.
  What is most troubling is that these stories are not isolated. The 
FBI testified before Congress as early as 2004 that they were seeing an 
epidemic in white collar crime. They stated the FBI did not have 
anywhere near enough agents to investigate major white collar crime 
like the financial crisis. There are moments when I do wonder if the 
FBI has the will to prosecute; but still, today, the FBI has nowhere 
near enough special agents or forensic experts to properly investigate 
the level of corruption that we know occurred.
  Frankly, the Congress has shorted the FBI--some might say purposely--
of the resources it needs to do the job. I have a bill, which I invite 
my colleagues to support, H.R. 1350, the Financial Crisis Criminal 
Investigation Act, authorizing an additional 1,000 FBI agents to 
aggressively investigate the kind of fraud that has destroyed the 
economic future of millions of our people and that has upset the global 
financial system.
  Back when we had the S&L crisis in the 1990s, we had 1,000 agents. Do 
you know how many were working when this financial crisis started? 
Forty-five. The others had all been reassigned to terrorism. We're only 
up a little over 200 agents now investigating white collar crime. Think 
about that, America. Why do you think these financial wrongdoers aren't 
in jail? Frankly, this Congress has not taken its responsibility to 
investigate seriously.
  Despite the robust public reporting of misdeeds on Wall Street, it 
has not been until the MF Global case, one of the top 10 bankruptcies 
in this country, that Congress has shown some mild interest in the 
magnitude of the inquiry required. In November, we got an inside look 
into the stunning misdeeds--and let's be blunt--outright thievery that 
occurred at MF Global in the days before it declared bankruptcy. The 
total amount missing from private accounts has fluctuated over the 
weeks. As much as $1.2 billion could be missing from private customer 
accounts.
  Congress is finally having hearings on this subject tomorrow, and 
we'll see how seriously an investigation is pursued. Let me say that 
the public has a right to know on what specific dates throughout 2011 
money from customer accounts was wire-transferred in order to meet MF 
Global's margin calls.

                              {time}  1050

  This is the key question. Members should ask, probe, and exact the 
truth. The public has a right to know on what specific dates through 
2011 was money from private customer accounts at MF wire-transferred in 
order to meet MF's global margin calls.
  If Mr. Corzine authorized the taking of those funds, then this body 
should remind him that no one is above the law, not even someone who 
was a former Goldman Sachs CEO, former Governor and U.S. Senator. 
Whichever friends and associates aided his actions in that company 
should be brought into full sunlight, as well as other companies that 
were likely involved in those wire transfers.
  The fact that hundreds of millions of dollars, if not over a billion 
dollars, can simply be stolen from a major banking institution from the 
inside requires full investigation, not just by the Congress, but by 
the FBI. I'm reminded of that book, written by Professor William Black, 
``The Best Way To Rob a Bank is To Own One.'' Well, I wonder how much 
of that applies in this case.
  It's time that Wall Street, white collar crimes, be prosecuted 
seriously, that this Congress do its job. Let's provide the FBI the 
resources it needs to fully investigate and prosecute, and the 
committees of this Chamber use their full authority to do no less. We 
surely owe this to the American people and the cause of justice toward 
all.

                          ____________________