P Morgan was born on April 17, 1837 and JP Morgan died on 1913. He escapes service in the Civil War by $300. When he was in service he brought rifles and the rifles each cost $3.50. His father was Junius and Junius was a millionaire that help found morden investment banking. JP Morgan is John Pierpont Morgan.
While, Goldman Sachs had a middleman that choose the mortgages to bet against, Citigroup did all of it themselves. They would create groups of mortgages that were going to fail, and they would then bet against them as a company while selling them to investors (Volcker Rule, Once Simple, Now Boggles). They would defraud the investors and reap the benefits from it. This sort of activity by the banks would be prohibited under the Volcker Rule. The only problem is though that such an activity could be called hedging and would be exploited as such an activity so that the banks could continue to do this.
It would seem the government did not fail to prosecute the executives responsible for the mortgage fiasco. “The Justice Department has an ethical obligation not to bring cases unless they have a better than 50% chance to convict. They argued the merits of each case and always came up short of the evidence necessary for a successful conviction. Greed is not a crime.” (Henning, 2015) The Assistant attorney general Lanny Breuer was not confident in his ability to prove criminal intent and therefore has not filed charges.
Agencies like Moody’s Investors Service, Standard&Poor’s and Fitch Ratings, to make big money were giving the best ratings AAA to the loans that shouldn’t been approved including bad credit and undocumented income factors (Smith, 2008). With good ratings, the loans get sold by the bank to the investors, homeowners could not afford the house, can’t refinance out of adjustable rate mortgage, making this cascading effect all the way down from investors to regular people as victims. Hundreds of billions dollars were downgraded to “junk” status and losses came to half of a trillion dollars (Wikipedia, n.d.). While a lot of law suits were started against Standard & Poor’s, none of the executives were actually sentences for the fraud, and most of the lawsuits were settled with the fine. (Reuters, 2013).
In “The ‘Banking’ Concept of Education” Paulo Freire addresses the inefficient and oppressive nature of modern education. Freire explains that the way in which teachers conduct educating is harmful to the students as well as the teachers. He proposes an alternative method to the banking concept called the problem-posing method. This method treats the teacher and students the same and allows for knowledge to flow in both directions. What Freire tries to convey in his work is that the way the act of educating is performed has a profound impact on the way the students materialize into the real world and how education can be used, intentionally or not, to control the students.
The Dodd-Frank Act led to the creation of the Consumer Financial Protection Bureau, which is set to protect consumers from financial misconduct. Although this Act seems like an aid, some say that these sorts of agencies can lure the industries, and can lead to creating regulatory policies that are in favor of the industry and markets, not the consumers. To add on, another theory is that institutions may join in with greater risks when they aren’t held up to the consequences of their actions. To counter this, the Dodd-Frank Act designated to overlook certain financial institutions that are “systematically important” and hence get more enhanced regulations overlooking them, as a way to prevent any other occurrences or high-level risk investments that can fail. You can argue that the regulations could push for more risky behavior from the institutions as it can act like a safety net that can rebounce the failures with the help of the
Abstract Bradley Birkenfeld, who served as a personal banker at the Swiss banking giant UBS, turned in the bank for being involved in illegal activities for which it had to pay a fine of $780 million, modify its banking practices and turn in the records of about 4,450 bankers for which the IRS was suspicious of being involved in tax evasion. However, Birkenfeld refused to disclose his relationship with one of the clients among the bank that was a Californian real-estate billionaire named Igor Olenicoff. When Olenicoff was charged, Birkenfeld was also accused for assisting him. As a result, Birkenfeld had to serve 40 months of jail time while Olenicoff cooperated with investigation and remained free.
Ventura suggests that the government’s bailout of the banks allowed them to continue their illegal and unethical activities without any repercussions. Ventura’s claim here is exaggerated yet still holds some truth to it. Many criticize the bailout as it did not hold banks properly accountable for their role in the financial crisis and instead gave them a way to escape consequences for their actions. According to the New York Times, the government did in fact, impose conditions on the banks that received bailout funds, these conditions were not always enforced, were later completely lifted, and there was very little oversight on how these funds were used meaning banks could have used the money for purposes not intended. Ventura says that the bailout was a way to protect the interests of the financial elite at the expense of taxpayers because bailouts were paid for by taxpayer money which many people saw as unfair and unjust.
Figure 2. – Three types of bank in Canada (Top Banks in Canada, 2015) From Figure 2. 1) Internal competitor bank (CIBC, RBC, BMO, and etc.,), the number of this bank is 63%. 2) U.S. bank, the number of this bank is 19%. 3) International bank, the number of this bank is 18%.
In 2013, JPMorgan Chase was threatened with a criminal lawsuit from the U.S. Department of Justice (Shonk, 2017). JPMorgan Chase was accused of questionable business decisions such as troubled mortgage investments that occurred during the financial crisis in 2008 (Shonk, 2017). The investments caused devastation to investors with mortgage-backed securities and pension funds (Bruinius, 2013). The problems caused by the bank contributed to the financial crisis that impacted companies and Americans across the country and some are still recovering to this day. In response, CEO Jamie Dimon offered a $3 billion settlement offer that was rejected after offering an initial $1 billion because it did not meet the level of damage that occurred to the
In the text, the ‘banking’ concept of education is distinguished as ‘the scope of action allowed to the students extends only as far as receiving, filling, and storing the deposits.’ Freire illustrates the roles the ‘banking’ concept plays in student’s education; how it affects the teachers, affects the students, and the type of relation it creates between a student and teacher. In the passage, Freire pointed out how the teachers who are using this precise model are having all the power, the power to determine a bright mind’s future. Having ‘power’ isn’t necessary displayed as having authority, it can also be displayed as how they teach, talk, and the mindset they bring to the classroom. Freire claims “”...
There are pros and cons to becoming a credit union member. Members own credit union and They have always stipulated to every members that they provide affordable services compared to other institutions. The issues that exist with credit unions are they’re located in certain areas and customer cannot open an account where they choose. A savings account is a vital money management means which helps with extended as well as short term financial needs. The savings account advantages are deposits and interest that occur over a period of time.
Executive Summary Lehman Brothers were an investment bank involved in transactions worth billions of dollars and one of the most powerful investment banks in the world. Lehman Brothers collapsed in 2008 following bad investment in the sub-prime mortgage market and used bad accounting practices called Repo 105 transactions to try and cover up the bad assets. This report sets out the use of the fraud triangle when describing the actions which led to the collapse. The pressure applied on the bank, the opportunity due to the lack of regulation to carry out the actions and the ability of the bank to rationalise their decision making.
Bank of America: Mobile Banking This essay is based on the case “Bank of America: Mobile Banking” which is dated on May 2012. We will first present benefits mobile banking provide to consumers and highlight reasons why many consumers haven’t adopted mobile banking yet. Furthermore, we will look into Bank of America motivation to offer mobile banking to its customers and review associated costs and risks of mobile banking implementation. Then understand what lessons can the bank learn from its online banking operations and analyze costs and benefits of having customers migrate to online banking.
I would frame the banking as an industry that is built on trust. Trust that is reaffirmed by the governments, and regulators. Banks have an imperative role in our economic growth, and development. Correspondingly, without the bank industry, there is no industry to replace them as the conduit for social and economic policy. Equally important, there is no industry to replace them as the key performer in creating our economies multiplier effect.
