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Matt Taibbi: 'Outrageous HSBC Settlement Proves The Drug War Is A Joke'

Caption this photo (in comments)...


By Matt Taibbi

Rolling Stone

If you've ever been arrested on a drug charge, if you've ever spent even a day in jail for having a stem of marijuana in your pocket or "drug paraphernalia" in your gym bag, Assistant Attorney General and longtime Bill Clinton pal Lanny Breuer has a message for you: Bite me.

Breuer this week signed off on a settlement deal with the British banking giant HSBC that is the ultimate insult to every ordinary person who's ever had his life altered by a narcotics charge. Despite the fact that HSBC admitted to laundering billions of dollars for Colombian and Mexican drug cartels (among others) and violating a host of important banking laws (from the Bank Secrecy Act to the Trading With the Enemy Act), Breuer and his Justice Department elected not to pursue criminal prosecutions of the bank, opting instead for a "record" financial settlement of $1.9 billion, which as one analyst noted is about five weeks of income for the bank.

The banks' laundering transactions were so brazen that the NSA probably could have spotted them from space. Breuer admitted that drug dealers would sometimes come to HSBC's Mexican branches and "deposit hundreds of thousands of dollars in cash, in a single day, into a single account, using boxes designed to fit the precise dimensions of the teller windows."

This bears repeating: in order to more efficiently move as much illegal money as possible into the "legitimate" banking institution HSBC, drug dealers specifically designed boxes to fit through the bank's teller windows. Tony Montana's henchmen marching dufflebags of cash into the fictional "American City Bank" in Miami was actually more subtle than what the cartels were doing when they washed their cash through one of Britain's most storied financial institutions.

Though this was not stated explicitly, the government's rationale in not pursuing criminal prosecutions against the bank was apparently rooted in concerns that putting executives from a "systemically important institution" in jail for drug laundering would threaten the stability of the financial system. The New York Times put it this way:

Federal and state authorities have chosen not to indict HSBC, the London-based bank, on charges of vast and prolonged money laundering, for fear that criminal prosecution would topple the bank and, in the process, endanger the financial system.

It doesn't take a genius to see that the reasoning here is beyond flawed. When you decide not to prosecute bankers for billion-dollar crimes connected to drug-dealing and terrorism (some of HSBC's Saudi and Bangladeshi clients had terrorist ties, according to a Senate investigation), it doesn't protect the banking system, it does exactly the opposite. It terrifies investors and depositors everywhere, leaving them with the clear impression that even the most "reputable" banks may in fact be captured institutions whose senior executives are in the employ of (this can't be repeated often enough) murderers and terrorists. Even more shocking, the Justice Department's response to learning about all of this was to do exactly the same thing that the HSBC executives did in the first place to get themselves in trouble – they took money to look the other way.

And not only did they sell out to drug dealers, they sold out cheap. You'll hear bragging this week by the Obama administration that they wrested a record penalty from HSBC, but it's a joke. Some of the penalties involved will literally make you laugh out loud.

This is from Breuer's announcement:

As a result of the government's investigation, HSBC has . . . "clawed back" deferred compensation bonuses given to some of its most senior U.S. anti-money laundering and compliance officers, and agreed to partially defer bonus compensation for its most senior officials during the five-year period of the deferred prosecution agreement.

Wow. So the executives who spent a decade laundering billions of dollars will have to partially defer their bonuses during the five-year deferred prosecution agreement? Are you fucking kidding me? That's the punishment? The government's negotiators couldn't hold firm on forcing HSBC officials to completely wait to receive their ill-gotten bonuses? They had to settle on making them "partially" wait? Every honest prosecutor in America has to be puking his guts out at such bargaining tactics. What was the Justice Department's opening offer – asking executives to restrict their Caribbean vacation time to nine weeks a year?

So you might ask, what's the appropriate financial penalty for a bank in HSBC's position? Exactly how much money should one extract from a firm that has been shamelessly profiting from business with criminals for years and years? Remember, we're talking about a company that has admitted to a smorgasbord of serious banking crimes. If you're the prosecutor, you've got this bank by the balls. So how much money should you take?

How about all of it? How about every last dollar the bank has made since it started its illegal activity? How about you dive into every bank account of every single executive involved in this mess and take every last bonus dollar they've ever earned? Then take their houses, their cars, the paintings they bought at Sotheby's auctions, the clothes in their closets, the loose change in the jars on their kitchen counters, every last freaking thing. Take it all and don't think twice. And then throw them in jail.

Sound harsh? It does, doesn't it? The only problem is, that's exactly what the government does just about every day to ordinary people involved in ordinary drug cases.

It'd be interesting, for instance, to ask the residents of Tenaha, Texas what they think about the HSBC settlement. That's the town where local police routinely pulled over (mostly black) motorists and, whenever they found cash, offered motorists a choice: They could either allow police to seize the money, or face drug and money laundering charges.

Or we could ask Anthony Smelley, the Indiana resident who won $50,000 in a car accident settlement and was carrying about $17K of that in cash in his car when he got pulled over. Cops searched his car and had drug dogs sniff around: The dogs alerted twice. No drugs were found, but police took the money anyway. Even after Smelley produced documentation proving where he got the money from, Putnam County officials tried to keep the money on the grounds that he could have used the cash to buy drugs in the future.

Seriously, that happened. It happens all the time, and even Lanny Breuer's own Justice Deparment gets into the act. In 2010 alone, U.S. Attorneys' offices deposited nearly $1.8 billion into government accounts as a result of forfeiture cases, most of them drug cases. You can see the Justice Department's own statistics right here:

Continue reading at Rolling Stone...


Matt Taibbi and Eliot Spitzer on HSBC:

Don't skip this clip.


Last week:

Matt Taibbi: 'Moynihan Perfects The Art Of I Can't Recall'


Photos by William Banzai7...

The laundry of HSBC
This money is clean as can be
Banks criminal ways
Shows that crime always pays
Move along, there is nothing to see

The Limerick King

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Reader Comments (37)

It's the police state control freaks that wants to terrorize
our kids.

Dec 18, 2012 at 4:32 PM | Unregistered CommenterPlease Enter Your Name Here
"Wow. So the executives who spent a decade laundering billions of dollars will have to partially defer their bonuses during the five-year deferred prosecution agreement? Are you fucking kidding me? That's the punishment? The government's negotiators couldn't hold firm on forcing HSBC officials to completely wait to receive their ill-gotten bonuses? They had to settle on making them "partially" wait? Every honest prosecutor in America has to be puking his guts out at such bargaining tactics. What was the Justice Department's opening offer – asking executives to restrict their Caribbean vacation time to nine weeks a year?"

As far as the caption goes...

If you show me yours, I'll show you mine.

Now where do I collect the prize?
Dec 18, 2012 at 6:11 PM | Unregistered Commenterjohn
Lanny, the shit on your nose is a bit more obvius than mine.
Dec 18, 2012 at 7:28 PM | Unregistered CommenterSKINFLINT
Dec 18, 2012 at 7:29 PM | Unregistered CommenterSKINFLINT
The hard part is expaining this to my kids. My daughter is taking a financial literacy class and it just amazes me the stuff she comes home with as far as literature is concerned. The fine line is telling her how corrupt the system is without completely ruining her innocence. I don't want her head to explode like mine.
Dec 18, 2012 at 8:56 PM | Unregistered CommenterSKINFLINT
If the same violence that was inflicted on that elementary school in Connecticut was instead unleashed on Wall Street and the government, people would no longer be gaping in disgust and horror; instead it would be met by cheers and long pent up feelings of vindication. The only ones that have the power to stop these sort of things are now the same people helping to perpetuate the crime. The government didn't inflict penalties as much as they made sure they got their share of the "take" . I wonder how many from Obama's Justice Department will seek employment in the finance industry once their stint in Washington comes to an end.

Whatever happened to we are a nation of laws and not men? Hopefully karma will play a role in this administration's destiny. If so, they can all look forward to a tragic fate.
Dec 18, 2012 at 10:31 PM | Unregistered CommenterSchlomo Putz
Caption second photo:
"I can't even look honest, and isn't it great that we don't even have to bother with trying?!"
Dec 18, 2012 at 11:50 PM | Unregistered CommenterKD
Caption second photo:
Eric: " What the f*** do they believe is the outcome of this trial ?"
Dec 19, 2012 at 8:17 AM | Unregistered Commenterchris
The author is right, the decent-sized company I work for took all their business elsewhere once they found out about the charges against HSBC. That's the main thing that we can do against the company at this point, boycott them and try to get them out of the country as an institution.
Dec 19, 2012 at 12:07 PM | Unregistered CommenterAC
And then I was like, Don't worry the dispensaries are safe.
Dec 19, 2012 at 12:34 PM | Unregistered CommenterAnon
Have you ever got a contact high from handling all of that dirty drug money. I have......
Dec 19, 2012 at 2:07 PM | Unregistered CommenterSuccotash
This Matt Taibbi kid is earning his keep. Like a seasoned pro comic superhero who all of sudden realizes somebody put kryptonite in his shoe, he performs the miracle of the ultimate expose' of the problem at hand in understandable terms crystal clear. It shows just how badly middle America has been dumbed down and hypnotized by the CFRtv, and the Rothschild's Associated Press. Taibbi also reminds me how pitifully little I have accomplished with my life. Mozart and Hendrix do that to me too.
So, cui bono? Queen lizard's extravagance all of a sudden becomes common pelf and the Mossad loses all dignity. They did it to themselves. They can always revolt and join the party. Save the schools. Art is good. Measure twice, cut once. Think twice, act once. Don't hurt nobody. Ephisians 6:12 is of divine providence, but that was before The Bible was editted by swine.
Dump the Fed.

Eric 'The Holder' Holder was picked to wind down and remain 'holding the bag'' for Bush41's 'Fast and Furious', a vulgar act. So the following caption was inspired,
" Wanna see something funny? I'm about to jump up and take a crap on this table!"
I really don't like this guy.
Dec 19, 2012 at 2:30 PM | Unregistered CommenterHoward T. Lewis III
Caption, Second Photo
"And they think we give a shit"!
Dec 19, 2012 at 7:13 PM | Unregistered CommenterBackgammon
Ten years later the Federal Government has yet to produce one ounce of proof that my $125,000 (the thieving Federal Agents took $24,000 to line their own pockets so they say it's $101,000) was illegal in any way, yet they confiscated it because I boarded a train with the cash. No drugs, no guns, nothing illegal,before, during or since - just my own hard earned money taken by Federal Agents. They tried three times to change the charges against me to fit what they might be able to prove. In the end, they took the money and never gave a cent back. No proof, no evidence. I just forfeited $125,000 because I was in possession of it. Plain and SImple.that's "The Greatest Country in the World"
Dec 20, 2012 at 4:09 PM | Unregistered CommenterMe
It's an absolute travesty that the American doj doesn't have the balls necessary to indict and jail this nefarious, infectious behavior. I believe another reason prosecution wasn't sought was because the big guys would have rolled over on everyone else doing this disgusting business thereby quite possibly exposing America's own Congress and Senate for doing the same thing. I've seen people calling for violence against the banksters, which isn't a bad idea I guess, but imho withdrawing your funds and shutting your accounts down would be a greater remedy. Starve the beasts from multiple directions.

I don't get it anymore. America used to seem to be a great place, but now is a wallowing, hypocritical, heretical pig. This is the icing on the cake to the downfall of lady liberty. What an absolute fucking joke!

60 trillion is suspicious transactions go "unnoticed" but Spitzer get snooped out by the same freaking bank with three $10,000 transactions to a front company for a call girl service.

So why can't the ndaa be turned around on the same people that designed it? It makes perfect sense to me and would be a step in the right direction especially considering what kind of precedence had just been set with this traitorous ruling!

Caption contest....
"Hey when you get home ask your wife for me how my dick tastes! I told you once you go black you never go back bitch!
Dec 20, 2012 at 4:53 PM | Unregistered Commenterlady liberty is dead
Caption Contest--- Holder to Breuer: "Try to act like you give a shit what these clowns think."
Dec 22, 2012 at 10:20 PM | Unregistered CommenterKen Rogers
Caption: "I told you not to wear that scent when we're in public...".

The merging of capital and political power is now finalized and evident for all to see. There is no use being surprised by any of it - it's been developing since before Abe Lincoln's presidency, and is now being fine-tuned for psychological consumption. The question remains when will the citizens of this country have enough?
Dec 24, 2012 at 11:17 AM | Unregistered CommenterMike P.
We used to go out crabbing. When some crabs would try to climb out of the bucket, others would pull them back in.Through valiant struggle, one crab might get out and be in the bottom of the boat. This crab, we threw back in because this crab was a survivor. I see no difference in the instincts displayed by people.

You try to explain the peril of settling for corruption and tyranny, and they just freeze up, stick their tongue out at you, and become participants. We have been advised that the patriotic American public is being prepared for slaughter and exploitation, and we can see the evidence in the FEMA camps and other draconian measures aimed solely at those not servicing the Rothschild obelisk. I suggest we turn the tables and flatten these pieces of shit, and make it impossible to exploit the welfare system. several domestic groups are cooperating in the destruction of the U.S. and these expendable crab-people just go along for the ride.
Dec 24, 2012 at 11:57 AM | Unregistered CommenterHoward T. Lewis III
"Oh my God, they're buying it! We're going to get away with it again!"
Jan 17, 2013 at 5:58 PM | Unregistered CommenterTanya
Refloating the German blooded monarchies in England, The Netherlands, and Belgium is proving to be way too expensive, AND IMPOSSIBLE TO DEFEND. 57% of illegal aliens in America are collecting welfare of some kind from honest hard-working American tax payers. Unions are being crushed while the congressional vermin mewl for campaign contributions and Eric 'The Holder' Holder escorts Bush41 to freedom and craps on the witness table with a hah hah hah. John Fogerty had it right. There will be justice all around. American adults believe that crap mom used to tell them about being perfect, safe, handsome or pretty, and smart. What a mess.
Jan 17, 2013 at 6:26 PM | Unregistered CommenterHoward T. Lewis III
The arrogance of all banks is simply breathtaking. They in now way take responsibility to their customers at large and the double standards they have alongside government is unbelieveable. What is even more unbelieveable is ow the majority of people actually stand for it.
Jan 18, 2013 at 6:47 AM | Unregistered CommenterBrigitte
Whatever happened to public executions for treason?

Luckily for these guilty pigs they are above the law..not so much for the little guy who gets screwed for minor possession and end up sharing a cell with a true hardened criminal.

How in the world this administration is proud of themselves is beyond me. I mean they truly exhibit psychopathic behaviors.

Caption contest "hey i asked my wife how your dick tasted and she wants to invite you over tonight so you can shit on her chest. It's her way of thanking you. I told her it was a bit extreme but she insists it's just as much fun to receive as it is to give. What a great woman i have, right? Just make sure you wear that sparkly g string bedazzled with obombas face. I want to bring our festivities to greater heights!"
Jan 18, 2013 at 10:07 AM | Unregistered Commenterlady liberty is dead
"Hey Lanny, no worries, Barry Soetoro has our back, forgettabout it."
Jan 18, 2013 at 6:11 PM | Unregistered CommenterMolon Labe
You rock America! They wouldn't get away with this in England. They wouldn't even get away with this in Mexico. The United States of American. A great place to do business. We'll even get the CIA to help carry the bags!
Jan 20, 2013 at 4:40 AM | Unregistered CommenterChrisB
Chris B. Ummm. HSBC is a british bank. If you want to go back a little more in your history, check out the BOE admission that they laundere money for the IRA back in the day. You guys have done it and continue to do it and there is nothing you can do about it.
Jan 20, 2013 at 10:36 AM | Unregistered CommenterSKINFLINT
As Matt points out, the culprits running the bank are not being punished--the "bank" is.

Why is that people embrace incorporation so whole-heartedly? The only purpose for incorporation is to limit liability.

Corporations are allowed to exist knowing their only reason for existence is to cheat us? Let's stop cheating each other.

End the corporations. They have no place in natural law.
Jan 23, 2013 at 3:53 PM | Unregistered Commenterusurykills
*Caption for 2nd photo*

Eric Holder to Lanny Breuer: "I dare you to pull your balls out during the hearing. What are they gonna do? Fine you?"
May 10, 2013 at 9:40 PM | Unregistered Commentersocialistmop
But, hey! For the little people we got lengthy sentences in privatized prisons, gun confiscation 2.0 billion hollow-point bullets, thousands of tanks to US cities and towns, FEMA troops and US military subordinated to the DHS, 30,000 soon to be weaponized drones flying over everywhere, and even more creative ways for the medical community to help people make sure they don't "outlive their usefulness". Besides, who wants to piss off the CIA, the biggest drug dealer of them all?
May 13, 2013 at 2:06 PM | Unregistered CommenterGreg Burton
This just in. Lanny Bruer was forced to resign as a result of him causing stubble burn on Eric Holders penis during Lannys under the desk meetings with Mr. Holder.
May 13, 2013 at 5:39 PM | Unregistered CommenterSKINFLINT
The Vampire Squid Strikes Again: The Mega Banks' Most Devious Scam Yet


Banks are no longer just financing heavy industry. They are actually buying it up and inventing bigger, bolder and scarier scams than ever
Feb 12, 2014 at 6:20 PM | Unregistered Commenterjohn
US drug czar calls for more access to heroin antidote


WASHINGTON - White House drug czar R. Gil Kerlikowske on Tuesday called for making naloxone, a drug that has been highly effective at reversing heroin overdoses, more widely available to emergency-care providers and other first responders.

Kerlikowske, director of the Office of National Drug Control Policy, also urged states and local communities to pass "good Samaritan" laws to provide immunity from criminal prosecution to individuals who call for emergency help during an overdose.

The comments come as focus on the growing number of heroin overdoses has sharpened after the death of Oscar-winning actor Philip Seymour Hoffman, who died Feb. 2. He was found in his New York City apartment with packets of the drug and a needle in his arm.

Heroin was involved in 3,038 overdose deaths in 2010, according to the Centers for Disease Control and Prevention. During a conference call Tuesday with reporters, Kerlikowske said that relying on law enforcement alone wouldn't solve the problem and that the Obama administration was focused on treating addiction and preventing overdoses.

"We are not going to arrest our way out of this drug problem," the former Seattle police chief said. He praised the president's Affordable Care Act for requiring insurance companies to cover substance abuse treatment in the same way they do other chronic diseases.
Feb 12, 2014 at 6:42 PM | Unregistered Commenterjohn
HSBC to announce bonuses totaling $4 billion: report


(Reuters) - HSBC will announce staff bonuses totaling just under 2.4 billion pounds ($4 billion) globally for 2013 and is expected to report a significant rise in pretax profit, Sky News reported on its website on Saturday without citing its sources.

Referring to an unnamed source close to the bank, Sky also said Chief Executive Stuart Gulliver will receive a 1.8 million pound bonus as part of an overall pay deal worth more than 7 million pounds, though this would be less than his previous year pay deal of 7.4 million.

Europe's biggest bank is expected to announce the size of its bonus pool on Monday along with its yearly results. Bonus payments remain a sensitive issue as many Britons still blame banks for the 2008 financial crisis, after which the state was forced to bail out RBS and Lloyds.

Earlier this month Barclays prompted an angry reaction from politicians and labor unions after it increased its bonuses by 13 percent to 2.4 billion pounds, even as it announced plans to axe 12,000 jobs…

...A spokesman at HSBC declined comment.
Feb 22, 2014 at 3:26 PM | Unregistered Commenterjohn

When I saw that you'd commented on the Taibbi piece, I wrongly assumed your comment would address MT's recent move to First Look Media, where he'll join Glenn Greenwald and others.

Gushing commentary about their moves to FLM within the Alternative Media (TM) is easy enough to find. But as someone whose cynical gut has yet to betray him even once during the post-bailout era (it's ALWAYS worse than you think), I found this bit of candid party crashing most pleasing:


As for HSBC, you knew the fix was in even deeper than anyone thought possible when Jim Comey joined the company's board of directors a couple of months before Obushma nominated him as FBI Director and right after the DOJ (which houses the FBI) formally declared that the rule of law was dead in the HSBC case. With Jim Crony at the helm, the FBI quickly and with little fanfare abandoned its decades-old mission--"law enforcement"--and replaced it with "national security."

And thus the in-your-face marriage between the criminal banks and the fake terrorist PR industry is complete. We have much to look forward to.
Feb 24, 2014 at 10:41 AM | Unregistered CommenterCheyenne
Cheyenne, I saw what happened to MT (and Greenwald), and just shook my head even though It didn't surprise me. Thanks for the link. The Mission Change at the agency, according to their website is, "To deal with Corrupt Public Officials".

Now I really need a drink.
Feb 24, 2014 at 9:10 PM | Unregistered Commenterjohn
Here's another take on the Greenwald/Snowden narrative, taken from the opposite pole of the political spectrum from Tarzie's and offering altogether different reasons to be skeptical.

Feb 26, 2014 at 5:43 PM | Unregistered CommenterCheyenne
Curiouser and curiouser, this Omidyar character and his "independent media"...

"Omidyar now has the only two people with exclusive access to the complete Snowden NSA cache, Glenn Greenwald and Laura Poitras. Somehow, the same billionaire who co-financed the 'coup' in Ukraine with USAID, also has exclusive access to the NSA secrets—and very few in the independent media dare voice a skeptical word about it."


Here's another skeptic, Arthur Silber, who pisses off pretty much everyone with delicious panache:

"Omidyar knew what he was buying when he hired Greenwald, Scahill, and the rest. He was buying a collection of journalists who would burnish his image of himself as a crusader for 'privacy' and against government surveillance (although even that is very strictly limited in a manner most people appear not to grasp, as we shall see), as well as generally bolstering his PR campaign to portray himself as a 'good' billionaire. He also bought one more thing: journalism that would never threaten his own interests in any way that need concern him."


Another true independent, Paul Craig Roberts, whose coverage of Ukranian goings-on has been remarkably prescient, had this to say:

"My criticism of Greenwald and Martin has nothing to do with their integrity or their character. I doubt the claims that Abby Martin grandstanded on 'Russia’s invasion of Ukraine' in order to boost her chances of moving into the more lucrative 'mainstream media.' My point is quite different. Even Abby Martin and Greenwald, both of whom bring us much light, cannot fully escape Western propaganda."

Mar 6, 2014 at 10:46 PM | Unregistered CommenterCheyenne

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