Video: Comparing Fannie/Freddie to Enron/Worldcom/Tyco
posted at 2:40 pm on October 2, 2008 by Ed Morrissey
Share on Facebook | regular view
A new YouTube group, Taxpayers for Truth, has a good question to ask today. The Bush administration frog-marched executives from Enron, Tyco, and Worldcom into federal prison for their financial shenanigans, in collapses that look positively microscopic in the wake of the failure of Fannie Mae and Freddie Mac. Why hasn’t anyone in the recent failure received the same treatment?
Here is the roster presented by the video, in brief:
- Bernard Ebbers, Worldcom: 25 years in prison
- Ken Lay, Enron: Convicted on 10 counts, died before serving sentence
- Jeff Skilling, Enron: 24 years in prison
- Andrew Fastow, Enron: 10 years in prison
- Dennis Koslowski, Tyco: 8 years in prison
- Mark Schwartz, Tyco: 8 years in prison
So how about the officers of Fannie Mae, who conducted similar kinds of fraud in their financial statements in order to pad bonuses and keep regulators from discovering their precarious position until it was too late? Franklin Raines never faced criminal charges, and instead settled a civil suit with a $2 million payoff — which came from Fannie Mae’s insurance company. Jim Johnson didn’t even have to do that much.
And where are they now? The Washington Post reported twice that Raines was advising the Barack Obama campaign, although they denied it. Jim Johnson still advises the Obama campaign and had briefly led the search for a running mate. Supposedly the FBI has begun a criminal probe into the actions of Fannie Mae management over the years, but we’ll see if that proceeds.
The final quote at the end says it all.
You must be logged in to post a comment.
Blowback
Note from Hot Air management: This section is for comments from Hot Air's community of registered readers. Please don't assume that Hot Air management agrees with or otherwise endorses any particular comment just because we let it stand. A reminder: Anyone who fails to comply with our terms of use may lose their posting privilege.
Trackbacks/Pings
Trackback URL
Comments
Comment pages:
Bush’s Justice Department TORE those criminals up and NANCY now doesn’t want a BLAME GAME.
HARRY & NANCY & BARACK NOT RIGHT FOR AMERICA
originalpechanga on October 2, 2008 at 2:44 PM
My lib friends screamed for YEARS about Enron, and Bush’s connection to “Kenny Boy”. They’re not being so loud now about the titanic, democratic engineered FM/FM disaster.
gmoonster on October 2, 2008 at 2:46 PM
Jamie Gorelick.
Put her behind bars.
carbon_footprint on October 2, 2008 at 2:48 PM
Hurry! Save it before You Tube takes it down!
/sadly, NOT sarc
Marybeth on October 2, 2008 at 2:50 PM
So where is all the outrage against Raines and Johnson?
These two assclowns should be under arrest and doing the perpwalk right now!
pilamaye on October 2, 2008 at 2:51 PM
Rush covered this yesterday, possibly quoting the same post, and it points up the hypocrisy in play with this ‘financial crisis’.
When McCain is sworn in, it will be his duty to clean house in The House, making those who are guilty of legislative malpractice pay for their sins. It would be a great benefit for the country to have those who caused this financial collapse pay instead of getting paid.
Doug on October 2, 2008 at 2:51 PM
There is a huge difference in the perception of justice for white guys that make big bucks running a corporation and do the wrong things, and Black and flaming homosexual Democrats that do the same thing with taxpayers dollars. So much for equality under the law.
Hening on October 2, 2008 at 2:51 PM
Send it to the McCain campaign!
Steve Z on October 2, 2008 at 2:52 PM
Republicans are wimps.
We have wimps leading our party. I never understood why, but we always seem to have nobody with a swinging pair between their legs.
TheHat on October 2, 2008 at 2:52 PM
We have wimps leading our party. I never understood why, but we always seem to have nobody with a swinging pair between their legs.
Maybe Palin does- we’ll see.
gmoonster on October 2, 2008 at 2:53 PM
DRUDGE: UK ambassador delivers frank assessment of ‘decidedly liberal’ Obama in secret letter to British PM Gordon Brown… LONDON TELEGRAPH to reveal all in leaked letter… Developing…
Could be juicy.
Cardiganfox on October 2, 2008 at 2:53 PM
instead they’ll gain power and never get caught, continue the lie. Go after nationalizing the Oil Industry and silencing critics.
Marxism, Leninism, Stalinism…..Obamaism
jp on October 2, 2008 at 2:53 PM
Oh hell…. just blame Bush anyway.
Mcguyver on October 2, 2008 at 2:54 PM
this type of corruption is supposedly what drives Democrat Voters, of course they think its all by those evil republicans and the Democrats are their saviours.
jp on October 2, 2008 at 2:54 PM
O/T. Remember the Philly lawyer who filed a law suit against Obama on the grounds that he was not eligible to run for President based on citizenship issues? Well, the judge has sided with the Plaintiff, Berg and has ordered that Obama produce a “vaulted” copy of his birth certificate, a certified copy of his certificate of citizenship and a certified copy of his oath of allegiance. All within 3 days. This should be interesting.
See attached:
http://docs.justia.com/cases/federal/district-courts/pennsylvania/paedce/2:2008cv04083/281573/13/
Syd B. on October 2, 2008 at 2:56 PM
Not enough time. If Obama wins, it all goes away or the big players will be granted immunity to testify. If McCain wins, he still has to deal with “I’m not allowing a witchhunt” Pelosi and Reid. Plus, Frank, Dodd and Obama are fellow Senators in the 100 man fraternity.
a capella on October 2, 2008 at 2:57 PM
I am going to file a class action suit against Raines, Gorelick, Johnson and any other officers who got rich while at FM/FM for committing fraud against the taxpayers. Anyone care to join?
Sporty1946 on October 2, 2008 at 2:57 PM
I wish people were FORCED to watch this!
tickleddragon on October 2, 2008 at 2:58 PM
This needs to be hung around Oslime-a’s neck. And McCain is on his way to doing exactly that. He mentioned the abuses of FM and FM in an interview yesterday. I HOPE he is only waiting for this bailout package to pass before he shoves this down Oslime-a’s throat.
csdeven on October 2, 2008 at 2:58 PM
I think it’s a brilliant idea. Where do I sign?
tickleddragon on October 2, 2008 at 2:59 PM
Hopefully they will. It took awhile to get some of the guys mentioned above.
Terrye on October 2, 2008 at 2:59 PM
Nothing to see here folks. Just moooooove along.
Sugar Land on October 2, 2008 at 3:00 PM
Just to inject a little bit of reason into this partisan outrage: The actions against the folks at Enron and WorldCom was taken years after they went bankrupt. Complaining about Fannie’s lack of accountability now is like complaining about Enron’s in 2001. These things take time. And, recall, Bush got reelected in 2004, when everyone knew his Lay connections. Obama’s friends will do like do him no greater harm than Bush’s.
calbear on October 2, 2008 at 3:01 PM
Interesting.
csdeven on October 2, 2008 at 3:01 PM
Alas, it’s all starting to remind me of Bob Dole’s impotent campaign cry, “Where’s the outrage?”
There’s much more to be outraged about with Obama, but the McCain campaign hasn’t been able to zero in, and has now been damaged by the terrible timing of the credit crisis.
JudetheFossil on October 2, 2008 at 3:01 PM
Folks, it’s not really necessary to think much to understand why these crooks didn’t get perp-walked. They are protected by powerful DEMOCRAT interests in Congress. Here’s a partial list. Barney Frank, Nancy Pelosi, Christopher Dodd, Charles Schumer, Charles Rangel, Edward Kennedy, Barack Obama, Maxine Waters… The list is sickening! The Republican party hasn’t had a pair since Newt was taken down. It’s about time a fire breathing conservative appeared to take charge (and not be a gaffe a minute like Biden) and force them to remember why they got voted into the majority in 1994, and why we stayed home and let them lose in 2006.
Webrider on October 2, 2008 at 3:01 PM
If you’re suggesting that they will be punished, just later, I don’t think I agree…
Unless people stay on them…constantly.
tickleddragon on October 2, 2008 at 3:03 PM
Great. I wish it could air nationally.
tree hugging sister on October 2, 2008 at 3:04 PM
I think that might just be the filing…attorneys on both sides prep the order they want the judge to sign…that is what was submitted, but no ruling yet…but if the judge DOES sign it, I think the MSM would HAVE to address it.
Re why no DOJ investigation: picture little canaries singing gleefully.
JustTruth101 on October 2, 2008 at 3:04 PM
The leaders of Enron and Worldcom violated SEC reporting standards – they lied to their stockholders. Arthor Anderson’s leaders comitted fraud even more systematically, but they were shielded from criminal liability by rules that Bill Clinton and the Democrat Congress managed to put into place.
I’m not sure that the leaders of Fannie Mae and Freddie Mac technically violated any laws. As I understand it, there were federal laws in place specifically PROHIBITING them from disclosing information about the viability of individual home loans after they had been bundled into securities. So how can they be accused of fraud?
Anytime you see big failures like this there are always going to be shady dealings toward the end; that’s really more desperation than premeditated criminal intent. All the premeditation happened years – or even decades ago.
And the really HUGE fraud is the one going on right now. You can bet your ass that the people currently sitting on those bad debt securities know exactly what they’re worth. But the federal government is now planning to buy them sight unseen. It’s hard to imagine how federal prosecutors can go back later and try to claim anyone “tricked” the government, when Congress and the Bush administration are intentionally closing their eyes during the purchase.
logis on October 2, 2008 at 3:05 PM
Friendly advice for the folks making these awesome YouTube videos:
STOP USING COPYRIGHTED MUSIC IN THEM.
Seriously, you just provide a pretext for yanking all your hard work.
It doesn’t do us any good to pass this video around to “5 Friends!” if it’s just going to be gone by the time they go to watch it.
benjamin on October 2, 2008 at 3:05 PM
Yet Obama will deny any connection to them, let them go to trial, and then pardon them.
The DoJ should be workin triple time between Obama’s phoney money and this scam of the American tax payers.
Rbastid on October 2, 2008 at 3:05 PM
That’s what I suspect…after the bailout passes – FULL COURT PRESS.
JustTruth101 on October 2, 2008 at 3:06 PM
FAN, FRED, AND FRANK
House Democrats are concerned that it wasn’t just Rep. Barney Frank who was having extracurricular relations with Fannie Mae and Freddie Mac executives, and that those relationships will come to light before the election a month from now.
According to a former Democrat staffer working for the House Committee on Financial Services, there were a number of stories involving Democrat members of the committee, as well as staffers for those Democrats, participating in retreats and getaway weekends paid for by Fan and Fred executives and lobbyists.
“Republicans were in the majority, and they weren’t getting invited on these trips,” says the former aide, who now works for an investment house in New York. “It’s not that Republicans weren’t enjoying themselves, but not the way my guys were. If I were a Democratic member in the mid to late 90s and dealt with financial services or housing issues, I’d be real nervous right now.”
Frank has not hidden the fact that he was in a romantic relationship with a former executive for Fannie Mae. Frank now chairs the Financial Services Committee and was one of several longtime Democrat members who sought assurances from Speaker of the House Nancy Pelosi that no action would be taken on Fan or Fred investigations until after the election in November.
Topsecretk9 on October 2, 2008 at 3:08 PM
DO IT! PLEASE!!
*eats*
Grue in the Attic on October 2, 2008 at 3:08 PM
“I wish people were FORCED to watch this!” tickleddragon wants Clockwork Orange to come true! If it gets the truth out, so am I. Lock ‘em in the neighborhood theaters and play this ad and others until they get it. Use their own words against them and use their silence as well.
Kick-ass video. I loved the background music too.
Can I dare to dream that the McCain team will start drilling there and drilling now? There is a mother lode/load (sp?) for the taking.
Christine on October 2, 2008 at 3:10 PM
Lets take up a collection, and buy ad time to run this in prime time.
Vashta.Nerada on October 2, 2008 at 3:11 PM
Fannie, Freddy, Enron…
We will forget all about these small distractions when the coming Federal Spending and Entitlement meltdown (led by Social Security)happens.
My question is: Who will BAILOUT the Federal Government?
edgehead on October 2, 2008 at 3:12 PM
I don’t post much on these fiscal issues, simply because I’m one of those guys that doesn’t like making an ass out of myself by talking about something that I know little about. I’ll leave the “why” and the “wherefores” to others more knowledgeable in these matters. (I tend to be more action oriented).
But I do know about BS when I see it, and this situation is one of them.
Allowing these thieves still out on the street is scandaless.
I have no doubt that if any one of us pulled this HrSt, we’d be doing the “prep walk” in front of the whole world with our trousers pulled down around our ankles.
Over.
1GooDDaDDy on October 2, 2008 at 3:13 PM
Thanks for the update. I think the attorney who filed the suit is a screwball, who has relied on discredited allegations, but even so, he has raised some interesting questions. At the very least, Obama should be willing to provide his certified birth certificate to put the rumors to rest. If he was born in the U.S., it should be easy enough to prove and it would not be burdensome. I could prove my birth in a number of convincing ways, including certified birth certificate from my homestate and the newspaper blurb detailing all births from our local hospital. It’s my understanding they cannot even determine which hospital Obambi was born in. If he was truly born in the U.S., I find that odd.
flyfisher on October 2, 2008 at 3:17 PM
If you can link it to global warming Algore will see that it becomes mandatory in schools. /sarc
Oldnuke on October 2, 2008 at 3:19 PM
I sent this link and the youtube video by itself to the campaign website.
Tazz 55 on October 2, 2008 at 3:19 PM
From Obamacrimes.com (emphasis added):
flyfisher on October 2, 2008 at 3:21 PM
Fear not. When large sums of money are lost as they have been at several large firms, legions of attorneys will be filing cases by the truckload looking for malfeasance.
If there was any, and I’m sure there was some, they will find it. Then it either goes criminal and or civil.
What you can be absolutely sure of is, the suits are coming.
patrick neid on October 2, 2008 at 3:22 PM
Am I alone in thinking that if this goes viral, it will be Bush’s final revenge?
Vashta.Nerada on October 2, 2008 at 3:22 PM
::eats:: ::buys more ammo::
bill30097 on October 2, 2008 at 3:23 PM
Karen Tumulty was unavailable for comment.
JammieWearingFool on October 2, 2008 at 3:25 PM
You sir are a gentleman and a scholar.
[A noblewoman and a scholar if you're a lady, just in case :)]
*eats*
Grue in the Attic on October 2, 2008 at 3:28 PM
*channeling Drive-By media*
Democrat wrongdoing? What Democrat wrongdoing? If there was any wrongdoing on the part of Dodd, Pelosi, Frank or any others WE would have told you! This whole thing is the fault of the Republicans. Move along, move along.
ManlyRash on October 2, 2008 at 3:31 PM
Video unavailable. I wonder if a swarm of Democratic operatives came around to kill it.
charlesbird on October 2, 2008 at 3:32 PM
Oops. Never mind. Now it works.
charlesbird on October 2, 2008 at 3:33 PM
YouTube blips like that sometimes. If it’s just a black screen with “sorry, video is not available”, then it’s a tech error and usually refreshing will fix it, or disabling then reenabling your ‘net connection then trying again.
If it’s actually been removed there’ll be nothing – no video box, no comments, nothing – except a bar saying “video removed”.
*eats*
Grue in the Attic on October 2, 2008 at 3:41 PM
McCain and his campaign don’t have time. Apparently, they are too busy closing campaign offices in Michigan. Can McCain look any weaker?
BuckeyeSam on October 2, 2008 at 3:41 PM
Oof- that is not a pretty thought.
BillH on October 2, 2008 at 3:48 PM
Johnson, Raines, Gorelick
Chakra Hammer on October 2, 2008 at 3:48 PM
O please O please O please O please O please O please O please O pleeeeeeease O please O please O please O please…
Akzed on October 2, 2008 at 3:50 PM
I’m saying that it’s too early to say, “They got away with it!” Also, as logis points out, this is a different type of situation: The magnitude of the crime is not a function of the magnitude of the loss. Often the scandal is not what’s illegal, but what’s legal.
calbear on October 2, 2008 at 3:53 PM
The SEC ruled that both Fannie and Freddie engaged in accounting fraud. They manipulated expenses and losses and mischaracterized assets classes to create a false impression of smoothly rising earnings. (Freddie actually UNDERSTATED earnings, but for the same reason) This fed a perception that both companies were growing in an orderly and non-risky fashion, while they were actually buying massive amounts of bad mortgages and undercutting their competition to create a virtual duopoly in the mortgage securitization market.
The accounting fraud made their stock highly prized by pension funds and other institutions that sought safe and steady growth. Fannie and Freddie became “glamour” stocks in the late 1990s, and they did it by cooking the books. And Raines’ successor did not do much better.
Raines was so sure his accounting methods were proper that he demanded an SEC review after the OFHEO report came out. The SEC found the same thing that OFHEO did.
One of the real scandals here is how Fannie and Freddie were never subject to Sarbanes-Oxley during this time; they were exempt from local taxes (Fannie Mae’s property was once estimated to be worth over $150 million, and they never paostid a dime of property tax on it.) and they were exempt from the capital requirements and deposit limits that limit the size and risk of the major banks who were their competitors. They had a staggering array of market advantages, and used them ruthlessly to batter their competition and destabilize the entire economy.
rockmom on October 2, 2008 at 3:53 PM
I wanna see some people in jail for this disaster
johnnyU on October 2, 2008 at 3:56 PM
Read this.
Buy Danish on October 2, 2008 at 3:59 PM
Sorry Johnny…. it was Halliburton’s fault!
http://www.humanevents.com/article.php?id=28837
Someone from dKos must have spiked the Kool Aid on Air Force
OneObama….CC
CapedConservative on October 2, 2008 at 4:14 PM
At the end of the video did you see that finger to the nose gesture by BO. He does this routinely. That’s body language for “what I am about to say is not true”….check it out.
http://www.deltabravo.net/custody/body.php
http://www.bodylanguagesignals.com/Face.html
jbh45 on October 2, 2008 at 4:15 PM
Now…let’s get a video like this out on Dodd and Frank.
Levinite on October 2, 2008 at 4:33 PM
EVERYONE needs to read first the complaint that was upheld for the plaintiff, THEN start at page 5 and read just what kind of f*cked up childhood OBAMA had. The arguments of the lawsuit are powerful, if proven.
DAYYAM!
tree hugging sister on October 2, 2008 at 4:36 PM
The attorney, a local gadfly, submitted a proposed order with his brief. The judge hasn’t signed any order and probably won’t. A friend with more sense than I have showed me the light on this one.
Bad Syd! Bad Syd! Getting my hopes up and all.
Akzed on October 2, 2008 at 4:37 PM
I swore at the beginning of the election campaign that I would not give a dime to any candidate or party.
I WILL donate to any 527, like “Taxpayers for Truth,” who put this message out!
Star20 on October 2, 2008 at 4:58 PM
I suggest using Ted Nugent music in all anti-Obama videos. I don’t think he would mind. I’m using it in my first anti-obama ad and have protested YouTube’s copyright claim.
It’s only 1:40 long.
http://www.youtube.com/watch?v=2wIr9qSWKlw
The Nuge Still ROCKS!
cannonball on October 2, 2008 at 4:58 PM
Liberal response landing on runway 4…
“Abramhoff! Halliburton! McSame!”
ynot4tony2 on October 2, 2008 at 5:38 PM
Here’s some fascinating reading. Also, check out some of the comments below the article.
http://newsbusters.org/blogs/p-j-gla…zen-wheres-msm
Syd B. on October 2, 2008 at 5:58 PM
Sorry, here’s the proper URL.
http://newsbusters.org/blogs/p-j-gladnick/2008/09/29/fight-smears-website-admits-obama-was-kenyan-citizen-wheres-msm
Syd B. on October 2, 2008 at 6:01 PM
I really don’t get it.
You switch the Dems/Repubs on the genesis of this Frannie Mae thing, and it would be 24/7 MSM blasting of Repubes. Look what the WaPoo did with a single word, “macaca.”
ex-Democrat on October 2, 2008 at 6:07 PM
Our country is being run by Soros, MoveOn and socialist media.
If we are apathetic we can say goodbye to America as we know it.
God Bless America is not a trite phrase.
SayWhat on October 2, 2008 at 6:22 PM
I’m a tyco employee and I support this message.
Zaire67 on October 2, 2008 at 6:22 PM
Where’s the probe? Where is the Congressional Blue Ribbon Panel?
Where is the CNN special: Fannie & Freddie….What caused the colapse?
If this were Enron or any other private company all of these things would already be being planned or implemented.
29Victor on October 2, 2008 at 6:59 PM
Comment pages: