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How to make some big bucks!

Bruce Krasting's picture




 

Finally the government is doing something to help the dismal employment situation and the drop in personal income. The clever folks in D.C. have come up with something that I am sure is going to create a new cottage industry. The upside in this new effort is very substantial indeed. The payoff starts at $200k and the sky is the limit after that.

What does one have to do to get some of the fast cash being offered? Easy! You just have to uncover a scam. Not some small scam, mind you. It has to be pretty big. The minimum threshold is a scam of not less than $1mm. These days everyone is ripping off everyone else. So this is really not as hard as it may sound.

To get started on this exciting new opportunity one must first go to this web site:

Our good friend, Mary Shapiro, has formally initiated the Whistle Blowers club (AKA-Rat Patrol).

If you’re wondering where to begin the process of coming up with the required ‘dirt’, the good old SEC has a page for that too. They have these helpful suggestions of where to start looking.

I have to admit that my personal income has been lagging of late. ZIRP is killing me and my stocks are (thankfully) underwater by only a tad so far this year. But my expenses have been soaring. My food and energy bill has been on a tear (I know this doesn’t matter to DC, but it sure does to me). Everything else is costing a bunch more (my health insurance is up 30% in a year!). The only expense that is going down is my income tax. Unfortunately that bill is zero because I am making no money (I suspect I’m not alone).

So I’ve decided that I’m going to become a rat and make some coin while I’m at it. This can be a collaborative effort. Anyone reading is welcome to join me while filing some claims.

What “We” are looking for is evidence of some big scams. Ones that will pay us big time for blowing that whistle. The minimum of $1mm is not where I/We should focus our efforts. I want 20% of a very big number. Say $1B. That would put a tidy $200mm in our pockets (actually they take the tax “off the top”). For those budding entrepreneurs (and potential partners) out there I have some thoughts on where we might look to find some Mega Scams that we could cash in on. Back to those helpful suggestions by the SEC:

Fraudulent investment scheme, such as a Ponzi scheme or the promise of high-yield returns

There has to be an angle here for us. The entire US economy is a Ponzi. Could we focus on the $6 trillion of recorded unfunded liabilities at the Social Security Trust Fund?

Unregistered securities offering

Could the Fed’s swap lines to other central banks be an avenue of inquiry? How about the Fed’s restriction on buying corporate securities? We have Maiden Lane as evidence they skirted the law.


General trading practices or pricing issues

I'm wondering if we could not make a case that QE is a distortion of pricing. After all, The Fed did buy 1.3 Trillion of private sector debt of the GSEs. That paper was worth no more than 60 cents on the dollar. The Fed bought it all in at a premium to par.

The good folks at Treasury bought over $2b of subordinated debt of Fannie and Freddie. This crap had no security behind it at all. It was worth less than a quarter of the face value (at best). But that swill got bought out a premium as well. Someone has to be guilty on the pricing issue.


Manipulation of a security

Manipulation? Everything is manipulated these days. Stocks, bonds, real estate and commodities have all been influenced by the not so invisible hand of Uncle Sam over the past few years.

Insider trading

This is fertile ground for us. There are dozens of examples that we could hone in on. For example, the S&P downgrade announcement was know to every money center bank well before it was public. We might look into all those “leaks” that Jon Hilsenrath at the WSJ gets from Bernanke.

Material misstatement or omission in a company's public filings or financial statements, or a failure to file

I could go on for a bit in this category. On the matter of public filings consider that neither Treasury, CBO nor OMB acknowledge we have unfunded liabilities of $50 trillion or so. When it comes to something simple like “failing to file” we could look into the fact that there has been no budget in the USA for 860 days.

Municipal securities transactions or public pension plans

The opportunities are endless in the category. Public pension funds are “accruing” income at an 8% rate, but they are not making close to that. Then there is the business of General Obligation debt by munis. Aren’t 49 states supposed to have balanced budgets?

Bribery of, or improper payments to, foreign officials (Foreign Corrupt Practices Act Violations)

Just one example that I can think of. In his book On the Brink former TSec Hank Paulson describes how the Russians tried to conspire with the Chinese to force the US into a GSE debt buyback by threatening to dump paper onto an already weak market. The threat worked. The Fed ended up buying 1.3T. This was an “improper” payoff to foreign officials; no?

A specific market event or condition

This one is sure to get the folks at Zero Hedge a very big payday. They have documented every flash crash for the past year. How many has there been now? 20 or so that I can think of.

While this area of inquire is certainly fertile ground for a whistle blower award it is also a difficult case to make. The problem is that the SEC would be on both sides of this. The SEC is absolutely responsible for the Flash Crashes. There can be no doubt about that. But getting them to agree (and to pay) will be another matter. In this case we could just document the facts and submit a claim. The claim would (of course) be denied. At that point all we would have to do is sue in Federal Court. The evidence of SEC culpability will stand up in court. (I think this is such a strong case that the lawyers would take it on a contingency basis)

Note: I’ve separately contacted Tyler Durden to elicit his support. My proposal is that he opens this up as a “class action” whistle blow. (All ZH registered viewers as of 5PM today will be included in the payout). So far Mr. D has been keeping his cards to his chest on this. (I can’t blame him, there are billions involved.)

If your complaint does not fit in any of the categories above, please describe below

Ah! The “kitchen sink” approach is open to us as well. I was happy to see that the SEC has left this so open ended. It allows us to be creative. I’m not going to dwell on this one. I leave that to you. There are hundreds of areas of inquiry here.

Sadly, this piece is just a joke. While there may well be hundreds of opportunities to blow the whistle on schemes, ponzis misrepresentations and market manipulation perpetrated by D.C. the last few years the chances of getting paid by the SEC for these tips is about zero.

That’s not to suggest that we shouldn’t use this opportunity to register our feelings of what is fair and what is not. I think the collective “we” should be sending thousands of messages to the SEC. So many that the servers get clogged. I’ll be sending a few. In case you want to join me, that link again: SEC Whistle blower.

We may not get paid for being a rat. But we surely can send a message to the Rats.
 .

 

 

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Tue, 08/16/2011 - 08:03 | 1564710 whirlybird rules
whirlybird rules's picture

Good article.  Thanks.

Mon, 08/15/2011 - 19:00 | 1563330 Rynak
Rynak's picture

Simply awesome article :) There are not many of this kind, in the contributor category. Congratz, this even easily beats your average article by the tylers :) To be honest, i'm not even sure if this should be a "contributor" article - this should be on the frontpage as a guestpost.

Mon, 08/15/2011 - 18:59 | 1563326 disabledvet
disabledvet's picture

Have no fear they'll contact your boss first to make sure you're on the up and up.

Mon, 08/15/2011 - 15:09 | 1562594 Gromit
Gromit's picture

Let's go after Fannie Mae foo issuing a fraudulent prospectus.

In fall 2007 they sold their "T" preferred at $25 per share and never paid a dividend.

It's traded over the last year between 28c and $3, currently at $1.86 / 1.88.

My guess is that the major holders are regional banks who don't want to make a fuss - but I have 5000 shares and I'm ready to join a class action.

Mon, 08/15/2011 - 14:51 | 1562518 Holden Caulfield
Holden Caulfield's picture

 

I believe 9/11 is the biggest fraud and until it is re-investigated the world will never be safe. WTC Building 7 Collapses at free fall speed? Plane into Pentagon? Plane in Shanksville PA?

The future is now. Be prepared.

 

Mon, 08/15/2011 - 14:48 | 1562498 Holden Caulfield
Holden Caulfield's picture

I believe the biggest fraud is 9/11.

Until it is re-investigated the world will never be safe.

WTC building 7 collapsing at free fall speed?

Plane into Pentagon?

Plane in Shanksville PA?

The future is now. Be prepared.

Mon, 08/15/2011 - 14:44 | 1562480 Holden Caulfield
Holden Caulfield's picture

I believe 9/11 is the biggest fraud and until it is re-investigated the world will never be safe.

WTC Building 7 Collapses at free fall speed? Plane into Pentagon? Plane in Shanksville PA?

The future is now. Be prepared.

Mon, 08/15/2011 - 14:42 | 1562470 Holden Caulfield
Holden Caulfield's picture


I believe 9/11 is the biggest fraud and until it is re-investigated the world will never be safe.

WTC Building 7 Collapses at free fall speed? Plane into Pentagon? Plane in Shanksville PA?

The future is now. Be prepared.

Mon, 08/15/2011 - 14:41 | 1562466 Holden Caulfield
Holden Caulfield's picture

I believe 9/11 is the biggest fraud and until it is re-investigated the world will never be safe.

WTC Building 7 Collapses at free fall speed? Plane into Pentagon? Plane in Shanksville PA?

The future is now. Be prepared.

Mon, 08/15/2011 - 14:18 | 1562341 GiantWang
GiantWang's picture

I am an attorney with a solid gold academic record who is starving in the real world because I refuse to be in bed with the banksters (and I'm constantly looking at stock quotes rather than billing time).  Let me know how I can help on this truly noble mission.

Mon, 08/15/2011 - 14:03 | 1562267 Mediocritas
Mediocritas's picture

We may not get paid for being a rat. But we surely can send a message to the Rats.

ROFL. That's gold.

Mon, 08/15/2011 - 12:22 | 1561815 Eireann go Brach
Eireann go Brach's picture

And the biggest fraud of all that should be whistleblowed and exposed by all voters....is that Barack Obama is fit to run this country?

Mon, 08/15/2011 - 14:02 | 1562266 bigkahuna
bigkahuna's picture

Oh, there are bigger frauds than that one out there. Social Security, the SEC, 9/11, Patriot Act - he might be a fraud, but he is a function of and a drop in "the fraud bucket". 

Mon, 08/15/2011 - 12:18 | 1561796 rwe2late
rwe2late's picture

 Can we report the SEC and the office of whistleblowing as  frauds,

or at least an accessory to frauds by  assisting the coverups?

Mon, 08/15/2011 - 12:14 | 1561776 falak pema
falak pema's picture

snitch is a name the mafia barons hate; I'm sure the Oligarchs are no different. The contracts will go out, like of old....If you don't have insurance of your own...you could get rubbed out trying to rat on those who make the world go round...or oblong...or in double dips and roller coaster rides or whatever.

Mon, 08/15/2011 - 12:06 | 1561749 rlouis
rlouis's picture

I want to blow the whistle on a few:

insider trading by congress

market manipulation by the Fed and Dept. of Teasury

defense contractor kick backs

Oh wait, this is all legal. Dang! 

Mon, 08/15/2011 - 12:05 | 1561744 Idbatty
Idbatty's picture

A ZH 'class action' whistle blow incriminating the Government under security laws would be a just act in this 'Gilty' Age.  Let's hang together on this Krasting proposal.

Mon, 08/15/2011 - 12:00 | 1561730 marcusfenix
marcusfenix's picture

ok, I'm turning any and all job sites who post 9000 openings (in your area) of which 90% are the same 100 jobs that have been re-posted ad naseum since january...not sure what they gain from it, but it is definitely fraud. oh yeah, and any company that demands an e-mail address to submit an resume or application because you know they only do that so they can turn around and sell your info, and with most of the country looking for work they are making a lot of money with that scam.

Mon, 08/15/2011 - 15:55 | 1562739 MrSteve
MrSteve's picture

look to Agent Rain and ADP.

ADP requires that you authorize them to do a credit rating on you when you apply for a job. ADP and Agent Rain then vend your data to insurance companies who pitch you to buy a franchise. When you don't, they start pitching you to buy their policies. Farmers Insurance is one participant in this scheme, per my personal witness.

I found the "rain" by digging into the copyright info on the application site and googling the names there, etc.

Mon, 08/15/2011 - 11:33 | 1561635 choorles
choorles's picture

 

STOP! WHAT IS MONEY? The money that the world uses today is created by private banks lending non-existent money called credit. This credit has never, does not and will never exist, except in theory on computer screens. People die and they starve all because they do not have enough digits on a computer screen. All of this credit, created by the private banks, is owed back to those same banks, plus interest. By design, there is never enough credit in circulation to pay back all the principal plus interest on the loans outstanding, which is why the concept of bankruptcy is built into the system.

Using the simple system above, banksters are given the ability to manipulate the world’s economies into ‘boom and bust’ cycles. In essence, the only difference between a boom and a bust is the amount of credit in circulation, or rather, the net amount of numbers on people’s computer screens. Initially, banksters create a boom by increasing the supply of credit in the economy. During this boom period, individuals and businesses are encouraged to take on more debt as they are more confident of increasing their income in the future. All this extra credit in the system leads to more activity, which in turn creates more confidence in the system, with many getting into more debt. This boom is akin to a fishing trawler, the bankster throws out a credit line and waits, once the bait has been taken the bankster begins to wind in the credit by taking credit out of circulation, it’s gone. The economy then moves into a slump or recession, simply because there are not enough units of credit in circulation. The banksters are then able to trawl from people the wealth that does exist, in exchange for money that never existed in the first place.

http://silverrevolucion.wordpress.com/2011/08/14/money-banksters-and-aug...

 

www.silverrevolucion.com

Mon, 08/15/2011 - 11:25 | 1561605 JW n FL
JW n FL's picture

Republicant Bruce Bitching about whistle blower payments.. dont be a fucking scum bag Bruce (not possible for you I know) and you will not have to worry about someone snitching you out!

Given your personality I can only assume the people that would suffer you are the types that would sell you down the river for less than $1 U.S. dollar!

there is NO protection for whsitle blowers in America!

Tell the Truth!

Go to Jail!!

 

Joe Davidson - Whistleblower protection bill hits sudden stop in ...

www.washingtonpost.comPolitics  You +1'd this publicly. Undo

Dec 15, 2010 – Whistleblower protection bill hits sudden stop in Congress ... Republicans also have decided to link the whistleblower bill to the controversy ...

?


  • Who killed the whistle-blower bill? - Los Angeles Times


    articles.latimes.com/2011/.../la-oe-devine-whistleblower-20110110 - Cached  You +1'd this publicly. Undo

    Jan 10, 2011 – Almost everyone agreed on the merits of the Whistleblower Protection Enhancement Act -- except one anonymous Republican senator who put ...

  •  

    You scum bag repugnant bottom feeders will be getting your due soon enough! 
    Mon, 08/15/2011 - 19:44 | 1563487 John_Coltrane
    John_Coltrane's picture

    "You scum bag repugnant bottom feeders will be getting your due soon enough! " 

    Such an insightful comment-very useful indeed.

    Maybe JW should write a useful blog like Bruce does for free with the many interesting facts on SS cash flow etc..  Your comments to him are consistently inane ravings.  As Hiliary liked to say, "it takes a villiage to raise an idiot" so congrats to your villiage.   If you don't like what he has to write, "don't read it"!   I know if I saw your name on a column, I certainly wouldn't click on it.

    For the rest of us, Bruce, keep up the good work.  Some losers like JW seem to think any sort of success in life is a reason for condemnation.  Envy is one the seven deadly sins for a reason.

    Tue, 08/16/2011 - 13:50 | 1566130 Bruce Krasting
    Bruce Krasting's picture

    Yeah! What Coltrane says!

    Don't like it, don't read it. Want to comment, be my guest. I can take heat as well as anyone.

    Scum bag bottom feeder? Not fair at all.

     

    Mon, 08/15/2011 - 12:13 | 1561772 rwe2late
    rwe2late's picture

     Please,

    I am no devotee of Mr. Krastings, but give him a break!

    In this instance, he is spot on,

    and his mocking diatribe against the 'fed office of whistleblowing' is meritorious.

    Mon, 08/15/2011 - 12:11 | 1561764 BlackholeDivestment
    BlackholeDivestment's picture

    ...the public is exposed. http://bible.cc/matthew/16-25.htm

    Mon, 08/15/2011 - 11:24 | 1561603 rosiescenario
    rosiescenario's picture

    "Bribery of, or improper payments to, foreign official..."

     

    ...uh, would payments 'from' also count? ...81 elected reps are going to Isreal...how much does AIPAC spend (and on whom) to buy our support?

    Mon, 08/15/2011 - 11:19 | 1561584 Flakmeister
    Flakmeister's picture

    Icahn just made $473,000,000 today.... he sure as fuck added that amount of value....  

    Mon, 08/15/2011 - 11:18 | 1561582 Miles Kendig
    Miles Kendig's picture

    Rock on BK! Everyone knows there's lots more out there hiding in broad sight.

    Mon, 08/15/2011 - 11:23 | 1561578 Widowmaker
    Widowmaker's picture

    This is a hail-mary attempt at sanity.

    Absolutely nothing will come of this tactic as the bonuses front running fraud, insulated by the "corporation", are just too good!

     

    Bruce, why did you remove the near-top comment about off balance sheet bullshit and mark to fraud accounting yesterday?

    Too close to the banker's-brotherhood for you I presume.

    Mon, 08/15/2011 - 12:37 | 1561859 Bruce Krasting
    Bruce Krasting's picture

    Not sure what you are referring to. I assure you have no ability to edit/delete comments on this site or any other site. Doesn't work that way.

    Even us members of the "Banker Brotherhood" can't delete comments on ZH.

    I would, however, have liked to deleted you a few times. This being no exception.

    Mon, 08/15/2011 - 11:17 | 1561575 DOT
    DOT's picture

    Can someone blow the whistle on me ?

    I've been providing material support to a Ponzi scheme for years.

    They promised me future wealth.

     

     

    Those Bastards !

     

    Mon, 08/15/2011 - 11:16 | 1561573 Rainman
    Rainman's picture

    Sadly, nearly all financial scum sucking activities are protected by emergency powers. It's in the fine print nobody cares to read.

    Mon, 08/15/2011 - 11:06 | 1561538 snowball777
    snowball777's picture

    Hats off to the first person to report Bernanke.

    http://www.wickedvintagetees.com/design_images/warnabrother.gif

     

    Mon, 08/15/2011 - 11:02 | 1561527 rsnoble
    rsnoble's picture

    Ok, I want to turn in the entire US govt, GS, JPM, C, BAC, WFC, and Bush And Cheney and Paulson.

    Please cut my check for $700 trillion now.

    Mon, 08/15/2011 - 11:03 | 1561532 rsnoble
    rsnoble's picture

    Oh, and add the SEC to that list also.

    Mon, 08/15/2011 - 10:52 | 1561494 Kayman
    Kayman's picture

    Bruce

    Only little rats will be prosecuted.  Same game, new name.

    Mon, 08/15/2011 - 11:02 | 1561524 legal eagle
    legal eagle's picture

    I haves client who was ripped off $15 million, I have had multiple meetings with SEC and FBI, they are overwhelmed by 1000s of these cases so they cannot prosecute. Unless YOU can acquire sufficient evidence to prosecute don't waste your time.

    Mon, 08/15/2011 - 11:13 | 1561563 Widowmaker
    Widowmaker's picture

    Mission Accomplished!

    Not to worry, the war on drugs is far, FAR more important to national security and your way of life.  Lock away anything with 1g. or more, prosecute to the maximum extent of the law!

     

    Here's one for you, Krasting, END TOO BIG TO FAIL, LET THE MARKET DO THE PROSECUTING!

    Mon, 08/15/2011 - 10:40 | 1561451 DB Cooper
    DB Cooper's picture

    Great post BK!  It is through these very things you point out that the gov't and TPTB have all legitimacy to rule.  I would like someone to look at trades in the market last week - the manipulations of the market surely were orchestrated to get some big players profits or stick save some losses. 

    Mon, 08/15/2011 - 11:01 | 1561426 wang (not verified)
    wang's picture

    I heard Rat tner on Bloomberg this AM. Apparently he is still financial advisor to Mayor Bloomberg.  Someone should look into this.

     

    Nov. 18 2010 (Bloomberg) -- Steven Rattner, the former head of Quadrangle Group LLC, will pay $6.2 million and accept a two- year ban from associating with broker-dealers or investment advisers to resolve a Securities and Exchange Commission probe of kickbacks in connection with the New York state pension fund.

    http://dealbook.nytimes.com/2010/10/15/what-it-means-to-manage-the-mayor...

    Updated: Jan. 3, 2011 (NYT)

    Mr. Rattner, a longtime Wall Street deal maker, now works at Willett Advisors, the personal money-management arm of his close friend Bloomberg, the billionaire mayor of New York. The attorney general’s settlement will no have no effect on Mr. Rattner’s current work. The S.E.C.’s two-year ban currently prohibits him from being paid by Willett and participating in some investment activities at the firm.

    http://topics.nytimes.com/top/reference/timestopics/people/r/steven_ratt...

    and their 13F

    http://fundville.com/fund/4018/WILLETT-ADVISORS-LLC

    Mon, 08/15/2011 - 10:27 | 1561407 IQ 145
    IQ 145's picture

    Holding on to my $38.80 Dec. Silver contract; the silver market has "consolidated" has people like to say who want to be mistaken for "experts"; in plain english the price range has tightened up around a central point; it looks to me like it's ready to move up. I never know where to post this stuff; but under a byline that says let's make a lot of money is not entirely off-topic.

    Mon, 08/15/2011 - 10:19 | 1561386 Northeaster
    Northeaster's picture

    Are you trying to say that all those shell companies I filed for my firms clients in Delaware, Nevada and Wyoming with their name spelled backwards five times wasn't legit?

    I may need to get in on this...

    Mon, 08/15/2011 - 10:16 | 1561379 SheepDog-One
    SheepDog-One's picture

    So you have to find someone doing something 'illegal' in the markets and report it to the SEC, but it cant be someone with Obama administration or Wall St central bankster connections, as theyre doing 'Gods work'.

    Mon, 08/15/2011 - 13:02 | 1561968 espirit
    espirit's picture

    Hey SD-1, you are far more likely to be rewarded for unearthing a new scheme which contributes to or reaffirms the ponzi.

    Sad, isn't it.

    Mon, 08/15/2011 - 10:03 | 1561331 bullet
    bullet's picture

    If I turned in the Federal Reserve, how much could I expect?

    Mon, 08/15/2011 - 10:13 | 1561370 Bruce Krasting
    Bruce Krasting's picture

    That "Blower Award" would top a half Tril in my opinion. 20% comes to 100 billion. What a party we could have!

    Mon, 08/15/2011 - 10:51 | 1561482 mikla
    mikla's picture

    Sadly, this piece is just a joke. While there may well be hundreds of opportunities to blow the whistle on schemes, ponzis misrepresentations and market manipulation perpetrated by D.C. the last few years the chances of getting paid by the SEC for these tips is about zero.

    I only partly agree.  The "capricious stochastic component" is the courts.  Sometimes, they just don't "play ball".

    Of course the SEC will deny all.  The courts will drag them kicking-and-screaming to an arbitrary liability and number, including injunctions.  Further, the courts often exceed their authority to mandate changes to law, changes to policy, and changes to practice.  The "two-sets-of-books" and "two-sets-of-laws" are only reigned in by the courts.

    No, I'm not asserting this is a likely outcome; but, it is a significant *possible* outcome.  For example, when the PowerBall is $1/ticket for a $95 million payout, and your odds-of-winning are 1-in-64-million, that ticket starts to look a *lot* more compelling (because the mathematical risk/reward makes sense).

    Of course, I honestly don't think the system will "hold together" long enough to get an answer from the courts, since that will take years, and we don't have years.  However, the "overhang" of publically-disclosed risk from such an active filing (like an ongoing corporate battle from an active legal issue) may prove to be significant in terminating the current (morally offensive) system.

    Mon, 08/15/2011 - 10:10 | 1561361 IQ 145
    IQ 145's picture

    And now for something completely different, as Monty Python would say. For those of you who followed my trade to short CHF/USD last week; you can take profits now, at the market. Enormous profits. This is not a scam. this is called trading. Cheers.

    Mon, 08/15/2011 - 10:29 | 1561412 Frog-And-Toad
    Frog-And-Toad's picture

    FAZ

     

    Looks mighty attractive right now... 

    Mon, 08/15/2011 - 13:35 | 1562147 Ratscam
    Ratscam's picture

    my avatar is insulted

    Do NOT follow this link or you will be banned from the site!