Government Corruption News Stories

Excerpts of Key Government Corruption News Stories in Major Media

Below are key excerpts of revealing news articles on government corruption from reliable news media sources. If any link fails to function, a paywall blocks full access, or the article is no longer available, try these digital tools.

Note: This comprehensive list of news stories is usually updated once a week. Explore our full index to revealing excerpts of key major media news stories on several dozen engaging topics. And don't miss amazing excerpts from 20 of the most revealing news articles ever published.

In January of this year, health and nutrition blogger Steve Cooksey received a disturbing letter from the North Carolina Board of Dietetics/Nutrition. The letter contained a 19-page markup of Cooksey’s own blog, highlighting in handwritten red pen an extensive series of changes the Board demanded that Cooksey make. He had to make these changes, the Board censors told him, or he would face arrest. Specifically, the Board censors said, he had to remove or change all writing they construed as constituting “nutrition advising” or “nutrition counseling” without a license. Forbes was granted exclusive first-look at a new series of internal documents, freshly leaked by outraged members within the Academy of Nutrition and Dietetics [formerly the American Dietetic Association, or ADA], the professional association behind the NC State Board of Dietetics/Nutrition which censored Cooksey. In these newly-available internal documents, [the ADA]: Openly discusses creating and using state boards of dietetics/nutrition ... for the express purpose of limiting market competition for its Registered Dietitian members; [and] openly discusses a nation-wide plan of surveilling and reporting private citizens, and particularly all competitors on the market for nutrition counseling, for “harming the public” by providing nutrition information/advice/counseling without a license.

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More than a decade has passed since Mitt Romney presided over the Winter Olympics in Salt Lake City, but the archival records from those games that were donated to the University of Utah to provide an unprecedented level of transparency about the historic event, remain off limits to the public. And some of the documents that may have shed the most light on Romney's stewardship of the Games were likely destroyed by Salt Lake Olympic officials. The archivists involved in preparing the documents for public review told ABC News that financial documents, contracts, appointment calendars, emails and correspondence are likely not included in the 1,100 boxes of Olympic records, and will not be part of the collection that will ultimately be made public. The Salt Lake City Winter Olympics represent a crucial chapter in the Romney biography -- his selection to oversee the Games came in the wake of a bribery scandal. Romney ... frequently cites the experience as part of what qualifies him to assume the presidency. But the absence of publicly available records that detail the decisions he made while running the games has increasingly become an uneasy subject for the library, which has for months been receiving inquiries from journalists and other researchers trying to subject Romney's version of the events to an analysis based on documents from the events. Romney [has] already faced criticism for his decisions to keep secret some of his past tax records and some details about his investment holdings.

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Regulators on both sides of the Atlantic failed to act on clear warnings that the Libor interest rate was being falsely reported by banks during the financial crisis, it emerged last night. A cache of documents released yesterday by the New York Federal Reserve showed that US officials had evidence from April 2008 that Barclays was knowingly posting false reports about the rate at which it could borrow in order to assuage market concerns about its solvency. An unnamed Barclays employee told a New York Fed analyst, Fabiola Ravazzolo, on 11 April 2008: "So we know that we're not posting, um, an honest Libor." He said Barclays started under-reporting Libor because graphs showing the relatively high rates at which the bank had to borrow attracted "unwanted attention" and the "share price went down". The verbatim note of the call released by the Fed represents the starkest evidence yet that Libor-fiddling was discussed in high regulatory circles years before Barclays' recent Ł290m fine. The New York Fed said that, immediately after the call, Ms Ravazzolo informed her superiors of the information, who then passed on her concerns to Tim Geithner, who was head of the New York Fed at the time. Mr Geithner investigated and drew up a six-point proposal for ensuring the integrity of Libor which he presented to the British Bankers Association, which is responsible for producing the Libor rate daily. Mr Geithner, who is now US Treasury Secretary, also forwarded the six-point plan to the Governor of the Bank of England, Sir Mervyn King.

Note: For deeply revealing reports from reliable major media sources on regulatory and financial corruption and criminality, click here. For our highly revealing Banking Corruption Information Center, click here.

The global bank HSBC has been used by Mexican drug cartels looking to get cash back into the United States, by Saudi Arabian banks that needed access to dollars despite their terrorist ties and by Iranians who wanted to circumvent United States sanctions, a Senate report says. The 335-page report released [on July 16] also says that executives at HSBC and regulators at the Office of the Comptroller of the Currency ignored warning signs and failed to stop the illegal behavior at many points between 2001 and 2010. The problems at HSBC, Europe's largest financial institution, [are] indicators of a broader problem of illegal money flowing through international financial institutions into the United States. The report on HSBC is the latest of several scandals that have recently rocked global banks and highlighted the inability of regulators to catch what is claimed to be widespread wrongdoing in the financial industry. The British bank Barclays recently admitted that its traders tried to manipulate a crucial global interest rate, and multiple major banks are under investigation. JPMorgan Chase disclosed last week that its employees may have tried to hide trades that are likely to cost the bank billions of dollars. The Office of the Comptroller of the Currency has come under particularly harsh criticism for showing too much deference to the banks it regulates.

Note: For deeply revealing reports from reliable major media sources on regulatory and financial corruption and criminality, click here. For our highly revealing Banking Corruption Information Center, click here.

Motorists may have been paying too much for their petrol because banks and other traders are likely to have tried to manipulate oil prices in the same way they rigged interest rates, an official report has warned. Concerns are growing about the reliability of oil prices, after a report for the G20 found the market is wide open to “manipulation or distortion”. Traders from banks, oil companies or hedge funds have an “incentive” to distort the market and are likely to try to report false prices, it said. Petrol retailers use oil price “benchmarks” to decide how much to pay for future supplies. The rate is calculated by data companies based on submissions from firms which trade oil on a daily basis – such as banks, hedge funds and energy companies. However, like Libor ... the market is unregulated and relies on the honesty of the firms to submit accurate data about all their trades. This is one of the major concerns raised in the G20 report, published last month by the International Organisation of Securities Commissions (IOSCO). In the study for global finance ministers, including George Osborne, the regulator warns that traders have opportunities to influence oil prices for their own profit. It points out that the whole market is “voluntary”, meaning banks and energy companies can choose which trades to make public. IOSCO says this “creates opportunity for a trader to submit a partial picture in order to influence the [price] to the trader’s advantage”.

Note: For deeply revealing reports from reliable major media sources on regulatory and financial corruption and criminality, click here.

Efforts to write benefits for biotech seed companies into U.S. legislation, including the new Farm Bill, are sparking a backlash from groups that say the multiple measures would severely limit U.S. oversight of genetically modified crops. From online petitions to face-to-face lobbying on Capitol Hill, an array of consumer and environmental organizations and individuals are ringing alarm bells over moves they say will eradicate badly needed safety checks on crops genetically modified to withstand herbicides, pests and pesticides. The measures could speed the path to market for big biotech companies like Monsanto and Dow Chemical that make billions of dollars from genetically altered corn, soybeans, cotton and other crops. "They are trying to change the rules," said George Kimbrell, senior attorney at the Center for Food Safety, which has lawsuits pending against government regulators for failing to follow the law in approving certain biotech crops. "It is to the detriment of good governance, farmers and to the environment." As early as next week the U.S. House of Representatives could take up one of the more controversial measures - a provision included in the 2013 Agriculture Appropriations bill known as Section 733 that would allow biotech crops to be planted even if courts rule they were approved illegally. Opponents call it the "Monsanto Rider" because Monsanto's genetically altered alfalfa and sugar beets have been subject to court challenges for illegal regulatory approvals.

Note: For deeply revealing reports from reliable major media sources on the dangers of genetically modified organisms, click here. Multiple reliable sources show that you may be eating genetically modified food daily which scientific experiments have repeatedly demonstrated can cause sickness and even death in lab animals. Click here to verify.

The Department of Homeland Security will soon be using a laser at airports that can detect everything about you from over 160 feet away. This laser-based scanner ... could read everything from a person’s adrenaline levels, to traces of gun powder on a person’s clothes, to illegal substances — and it can all be done without a physical search. It also could be used on multiple people at a time, eliminating random searches at airports. The scanner is called the Picosecond Programmable Laser. The device works by blasting its target with lasers which vibrate molecules that are then read by the machine that determine what substances a person has been exposed to. The inventor of this invasive technology is Genia Photonics. Active since 2009, they hold 30 patents on laser technology designed for scanning. In 2011, they formed a partnership with In-Q-Tel, a company chartered by the CIA and Congress to build “a bridge between the Agency and a new set of technology innovators.” Although the technology could be used by “Big Brother,” Genia Photonics states that the device could be far more beneficial being used for medical purposes to check for cancer in real time, lipids detection, and patient monitoring.

Note: For deeply revealing reports from reliable major media sources on government threats to privacy, click here.

On February 2, 2011, President Obama called Yemeni President Ali Abdullah Saleh. The two discussed counterterrorism cooperation and the battle against Al Qaeda in the Arabian Peninsula. At the end of the call, according to a White House read-out, Obama “expressed concern” over the release of a man named Abdulelah Haider Shaye, whom Obama said “had been sentenced to five years in prison for his association with AQAP.” It turned out that Shaye had not yet been released at the time of the call, but Saleh did have a pardon for him prepared and was ready to sign it. But ... Abdulelah Haider Shaye is not an Islamist militant or an Al Qaeda operative. He is a journalist. Shaye risked his life to travel to areas controlled by Al Qaeda and to interview its leaders. He also conducted several interviews with the radical cleric Anwar al Awlaki. Shaye did the last known interview with Awlaki just before it was revealed that Awlaki, a US citizen, was on a CIA/JSOC hit list. “We were only exposed to Western media and Arab media funded by the West, which depicts only one image of Al Qaeda,” recalls his best friend Kamal Sharaf, a well-known dissident Yemeni political cartoonist. “But Abdulelah brought a different viewpoint.” Shaye had no reverence for Al Qaeda, but viewed the group as an important story, according to Sharaf.

Note: We generally avoid using sources with a strong bias like The Nation, but as none of the other major media have touched this most important story, we're including it here. For more on this revealing story, click here and here

For generations, most college-bound Americans paid reasonable fees to attend publicly financed state universities. But the bedrock of that system is fracturing as cash-strapped states slash funding to these schools just as attendance has soared. Places like Ohio State, Penn State and the University of Michigan now receive less than 7 percent of their budgets from state appropriations. As a result, public universities — which historically have graduated the majority of U.S. college students — are eliminating programs, raising tuition and accepting more out-of-state students, who typically pay significantly higher rates. The upshot of it all? Students face greater competition for admission, significantly higher tuition bills and bigger debt loads upon graduation. The state cutbacks also mean students are attending larger classes, frequently taught by part-time professors earning dismal salaries. In 2009, less than a quarter of all university faculty were full-time, compared with 45 percent in 1975, according to the American Association of University Professors. State and local spending for public university students dropped to a 25-year low in 2011. Tuition and fees at public, four-year colleges have jumped by more than 70 percent on average over the last decade. Those costs hit $8,240 in 2011-12, up from $4,790 in 2001-02.

Note: Is the military more important than education? Why do huge military budgets continue to be well funded while educational budgets are slashed? Is this the future we want to give our children?

A wide-ranging surveillance operation by the Food and Drug Administration against a group of its own scientists utilized an enemies list of sorts as it secretly captured thousands of e-mails that the disgruntled scientists sent privately to members of Congress, lawyers, labor officials, journalists and even President Obama, previously undisclosed records show. What began as a narrow investigation into the possible leaking of confidential agency information by five scientists quickly grew in mid-2010 into a much broader campaign to counter outside critics of the agency's medical review process, according to the cache of more than 80,000 pages of computer documents generated by the surveillance effort. Moving to quell what one memo called the "collaboration" of the FDA's opponents, the surveillance operation identified 21 agency employees, congressional officials, outside medical researchers and journalists thought to be working together to put out negative and "defamatory" information about the agency. The agency, using so-called spy software designed to help employers monitor workers, captured screen images from the government laptops of the five scientists as they were being used at work or at home. The extraordinary surveillance effort grew out of a bitter, years-long dispute between the scientists and their bosses at the FDA over the scientists' claims that faulty review procedures at the agency had led to the approval of medical imaging devices for mammograms and colonoscopies that exposed patients to dangerous levels of radiation.

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The Barclays Libor scandal may have shocked the British public, but Joseph Stiglitz saw it coming decades ago. And he's convinced that jailing bankers is the best way to curb market abuses. [Former World Bank Chief Economist] Stiglitz wrote a series of papers in the 1970s and 1980s explaining how when some individuals have access to privileged knowledge that others don't, free markets yield bad outcomes for wider society. That insight (known as the theory of "asymmetric information") won Stiglitz the Nobel Prize for economics in 2001. And he has leveraged those credentials relentlessly ever since to batter at the walls of "free market fundamentalism". It is a crusade that [includes] his new book The Price of Inequality. When traders working for Barclays rigged the Libor interest rate and flogged toxic financial derivatives – using their privileged position in the financial system to make profits at the expense of their customers – they were unwittingly proving Stiglitz right. "It's a textbook illustration," Stiglitz said. "Where there are these asymmetries a lot of these activities are directed at rent seeking [appropriating resources from someone else rather than creating new wealth]. That was one of my original points. It wasn't about productivity, it was taking advantage." He argues that breaking the economic and political power that has been amassed by the financial sector in recent decades, especially in the US and the UK, is essential if we are to build a more just and prosperous society. The first step, he says, is sending some bankers to jail.

Note: For key investigative reports on the criminality and corruption in the financial industry and biggest banks, click here.

Once more the big banks are exposed in systematic fraudulent activity. When Barclays agreed to a $450 million fine for trying to rig the Libor, its CEO offered the classic excuse: Everyone does it. Once more the question remains: Will CEOs and CFOs, as well as traders, be prosecuted? Or will they depart with their multimillion dollar rewards intact, leaving shareholders to pay the tab for the hundreds of millions in fines? The Barclays settlement exposed that traders colluded to try to fix the Libor rate. This is the rate used as the basis for exotic derivatives as well as mortgages, credit card and personal loan rates. Almost everyone is affected. Fixing the rate even a few hundredths of a percentage point could make Barclays millions on any single day — money taken out of the pockets of consumers and investors. Once more the banks were rigging the rules; once more their customers were their mark. The collusion was systematic and routine. Investigations are underway not only in the United Kingdom but also in the United States, Canada and the European Union. Those named in the probes are all the usual suspects: JPMorgan Chase, Citibank, UBS, Deutsche Bank, HSBC, UBS and others. This wasn’t rogue trading, ... it was more like a cartel. The Economist writes that what has been revealed here is “the rotten heart of finance,” a “culture of casual dishonesty.”

Note: For key investigative reports on the criminality and corruption in the financial industry and biggest banks, click here.

The rapidly spreading scandal of LIBOR (the London inter-bank offered rate) ... is beginning to assume global significance. The number that the traders were toying with determines the prices that people and corporations around the world pay for loans or receive for their savings. It is used as a benchmark to set payments on about $800 trillion-worth of financial instruments, ranging from complex interest-rate derivatives to simple mortgages. The number determines the global flow of billions of dollars each year. Yet it turns out to have been flawed. Over the past week damning evidence has emerged, in documents detailing a settlement between Barclays and regulators in America and Britain, that employees at the bank and at several other unnamed banks tried to rig the number time and again over a period of at least five years. And worse is likely to emerge. Investigations by regulators in several countries, including Canada, America, Japan, the EU, Switzerland and Britain, are looking into allegations that LIBOR and similar rates were rigged by large numbers of banks. As many as 20 big banks have been named in various investigations or lawsuits alleging that LIBOR was rigged. The scandal also corrodes further what little remains of public trust in banks and those who run them.

Note: For key investigative reports on the criminality and corruption in the financial industry and biggest banks, click here.

Just when you thought Wall Street couldn't sink any lower - when its excesses are still causing hardship to millions of Americans and its myriad abuses of public trust have already spread a miasma of cynicism over the entire economic system - an even deeper level of public-be-damned greed and corruption is revealed. Libor is the benchmark for trillions of dollars of loans worldwide - mortgage loans, small-business loans, personal loans. It's compiled by averaging the rates at which the major banks say they borrow. So far, the scandal has been limited to Barclays, a big, London bank that just paid $453 million to U.S. and British bank regulators, whose top executives have been forced to resign, and whose traders' e-mails give a chilling picture of how easily they got their colleagues to rig interest rates in order to make big bucks. But Wall Street has almost surely been involved in the same practice, including the usual suspects - JPMorgan Chase, Citigroup and Bank of America - because every major bank participates in setting the Libor rate, and Barclays couldn't have rigged it without their witting involvement. In fact, Barclays' defense has been that every major bank was fixing Libor in the same way, and for the same reason. And Barclays is "cooperating" (i.e., providing damning evidence about other big banks) with the Justice Department and other regulators in order to avoid steeper penalties or criminal prosecutions, so the fireworks have just begun.

Note: The author of this article, Robert Reich, is former U.S. secretary of labor, professor of public policy at UC Berkeley and the author of Aftershock: The Next Economy and America's Future. He blogs at www.robertreich.org.

JPMorgan Chase said Friday that its traders may have tried to conceal the losses from a soured bet that has embarrassed the bank and cost it almost $6 billion — far more than its CEO first suggested. The bank said an internal investigation had uncovered evidence that led executives to “question the integrity” of the values, or marks, that traders assigned to their trades. JPMorgan also said that it planned to revoke two years’ worth of pay from some of the senior managers involved in the bad bet, and that it had closed the division of the bank responsible for the mistake. “This has shaken our company to the core,” CEO Jamie Dimon said. The bank said the loss, which Dimon estimated at $2 billion when he disclosed it in May, had grown to $5.8 billion. The investigation, which covered more than a million emails and tens of thousands of voice messages, suggested traders were trying to make losses look smaller, the bank said. The revelation could expose JPMorgan to civil fraud charges. If regulators decide that employee deceptions caused JPMorgan to report inaccurate financial details, they could pursue charges against the employees, the bank or both. JPMorgan could not necessarily hide behind the actions of its employees. Regulators could decide that its oversight or risk management contributed to the problematic statements.

Note: Yet will anyone go to jail for these shady activities? For key investigative reports on the criminality and corruption in the financial industry and biggest banks, click here.

Wells Fargo & Co.'s settlement of allegations that it overcharged minorities for home loans and wrongly steered them into subprime mortgages requires the bank to pay $125 million in damages, including about $10 million to African Americans and Latinos in the Los Angeles area. The settlement ... also requires the San Francisco company, by far the nation's largest home lender, to provide $50 million in down-payment assistance to residents of areas where the alleged discrimination had a significant effect. The $175-million total is the second-largest fair-lending settlement by the civil rights arm of the Justice Department. The largest, reached in December, requires Bank of America Corp. to pay $335 million to settle claims against Countrywide Financial Corp., the aggressive Calabasas lender it acquired in 2008. Another former Wells Fargo unit — the now-defunct subprime storefront lender Wells Fargo Financial Inc. — was the target of a separate investigation by the Federal Reserve. Wells Fargo agreed last year to pay $85 million to settle allegations that Wells Fargo Financial employees improperly pushed borrowers into more expensive subprime loans and exaggerated income information on mortgage applications. The agreement covers lending from 2004 through 2009 in the wholesale section of Wells Fargo Home Mortgage, which made loans of all kinds, including prime and subprime mortgages, through independent brokers.

Note: For key investigative reports on the criminality and corruption in the financial industry and biggest banks, click here.

After years of following the paper trail of $51 billion in U.S. taxpayer dollars provided to rebuild a broken Iraq, the U.S. government can say with certainty that too much was wasted. But it can't say how much. In what it called its final audit report, the Office of the Special Inspector General for Iraq Reconstruction Funds ... spelled out a range of accounting weaknesses that put "billions of American taxpayer dollars at risk of waste and misappropriation" in the largest reconstruction project of its kind in U.S. history. "The precise amount lost to fraud and waste can never be known," the report said. The office has spent more than $200 million tracking the reconstruction funds, and in addition to producing numerous reports, his office has investigated criminal fraud that has resulted in 87 indictments, 71 convictions and $176 million in fines and other penalties. These include civilians and military members accused of kickbacks, bribery, bid-rigging, fraud, embezzlement and outright theft of government property and funds. Of the $51 billion that Congress approved for Iraq reconstruction, about $20 billion was for rebuilding Iraqi security forces and about $20 billion was for rebuilding the country's basic infrastructure.

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One of the world's deadliest businesses - the $55 billion-per-year arms trade - prefers to operate in the shadows. Bananas, cold pills and truck tires come with more market rules and international norms. This shameful gap could be filled by a United Nations agreement nearing completion in New York. The Arms Trade Treaty would require signatory countries to abide by clear rules on the import, export and transfer of weapons, ranging from small arms to air-defense systems. The aim is to bring a lethal, back-alley game into the open and curb sales to brushfire wars and terrorist groups. Think of Syria, Sudan and Somalia as prime examples where outside guns, tanks or helicopters are killing thousands. Governments, militias and guerrilla movements with the cash can buy virtually anything through brokers with the right connections. The United States, as the top seller of arms, has a special duty to improve this patchwork system. The Obama administration has pushed for approval of the treaty, a healthy break from the Bush White House, which favored a country-by-country approach that achieved little. But don't think this treaty is a slam-dunk. Gun-rights groups such as the National Rifle Association bristle at any mention of weapons controls and see the treaty as a threat to domestic gun ownership. It's nothing of the sort, and State Department negotiators have made Second Amendment guarantees an absolute "red line" in talks.

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The Libor scandal has confirmed what many of us have known for some time: There is something smelly in the London financial world and the stench is now overwhelming. The Financial Services Authority report [made it] clear just how widespread, how blatant was the fixing of the benchmark interest rate Libor and Euribor by Barclays. Brazen is the only word for it. The emails and phone calls reveal that on dozens of occasions those who stood to gain by the decisions asked for favors (and got them) from those who helped set the interest rates. And all the time the world believed Libor was somehow a barometer of what banks were lending to each other. It wasn't. It was the rate at which a bank was prepared to corrupt the money markets for its own narrow, venal gain. It is the way the traders, the rate submitters -- everyone involved in this cesspit -- [were] running to do wrong which makes it so egregious. With one or two feeble exceptions, no one ever seemed to stop and say "this is against the rules." Or, heaven forbid, "this is wrong." I have no doubt that Barclays wasn't the only one up to this. The FSA report makes it clear that other traders were putting pressure on their rate setters too. Libor and its cousin Euribor are the rates used to determine hundreds of trillions of dollars worth of highly specialized financial contracts called derivatives. Businesses and household loans are set by this benchmark. It is the backbone of the financial world and now it has been proven to be bent and crooked.

Note: For an incredibly incisive interview between Eliot Spitzer, Matt Taibbi, and a top banking expert on how the LIBOR scandal undermines the integrity of all banking, click here. For astounding news on the $700 trillion derivatives bubble, click here. For a treasure trove of reliable reports on the criminality and corruption within the financial and banking industries, click here.

An anonymous insider from one of Britain's biggest lenders ... explains how he and his colleagues helped manipulate the UK's bank borrowing rate. Neither the insider nor the bank can be identified for legal reasons. It was during a weekly economic briefing at the bank in early 2008 that I first heard the phrase. A sterling swaps trader told the assembled economists and managers that "Libor was dislocated with itself". What the trader told us was that the bank could not be seen to be borrowing at high rates, so we were putting in low Libor submissions, the same as everyone. How could we do that? Easy. The British Bankers' Association, which compiled Libor, asked for a rate submission but there were no checks. The trader said there was a general acceptance that you lowered the price a few basis points each day. According to the trader, "everyone knew" and "everyone was doing it". There was no implication of illegality. After all, there were 20 to 30 people in the room – from management to economists, structuring teams to salespeople – and more on the teleconference dial-in from across the country. The discussion was so open the behaviour seemed above board. In no sense was this a clandestine gathering. Libor had dislocated with itself for a very good reason – to hide the true issues within the bank.

Note: For an incredibly incisive interview between Eliot Spitzer, Matt Taibbi, and a top banking expert on how the LIBOR scandal undermines the integrity of all banking, click here. For a treasure trove of reliable reports on the criminality and corruption within the financial and banking industries, click here.

Important Note: Explore our full index to revealing excerpts of key major media news stories on several dozen engaging topics. And don't miss amazing excerpts from 20 of the most revealing news articles ever published.