Tuesday, April 21, 2009

The Bank Frauds Continue

....that is, the ones perpetrated by the banks, not by ordinary fraudsters...

...it is gratifying to see on the front page of the NYT Business section, Andrew Ross Sorkin’s article with the provocative but accurate title, Bank Profits Appear Out of Thin Air.

...It refers to Bank of America’s fraudulent earnings scheme of booking a $2.2 billion gain that falsely increases value of the Merrill Lynch’s assets recently acquired. BofA decided to give themselves a phony profit bump by raising the value of Merrill assets to prices significantly higher than Merrill kept them.

We are also reminded of Goldman Sach's "disappearing December" (a loss of $1.5Bn which kinda sorta didn't show up clearly) and the JPMorgan and Citi "bond-deflation = earnings gains" tricks.

We may soon be debating which is worse: Barney Frank or the current managers. There's merit on each side of that debate.

HT: The Big Picture

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