Obama Signs Wall Street/Corporate Backed "Jobs Act": A “Recipe for Fraud” And Job Destruction [View all]

[Better Believe It]

Last edited Thu Apr 5, 2012, 11:41 PM - Edit history (3)

FOR IMMEDIATE RELEASE
April 5, 2012
Institute for Public Accuracy (IPA)

“JOBS Act” a “Recipe for Fraud” Creating a “Race to the Bottom”

WASHINGTON - April 5 - WILLIAM K. BLACK, blackw at umkc.edu

Available for a limited number of interviews, Black is now an associate professor of economics and law at the University of Missouri, Kansas City and the author of “The Best Way to Rob a Bank is to Own One.” He was the deputy staff director of the national commission that investigated the cause of the savings and loan debacle. He was just interviewed by The Real News: “JOBS Act 2012 a Recipe for Fraud.”

Black recently wrote an open letter signed by several noted analysts: “The JOBS Act is so Criminogenic that it Guarantees Full-Time Jobs for Criminologists,”states: “As white-collar criminologists (and a former financial regulator and enforcement head) and experts in ferreting out sophisticated financial frauds, our careers and research focus on financial fraud by the world’s most elite private sector criminals and their political cronies. Therefore, we write to thank Congress and the President for preparing to adopt a JOBS Act that will provide us with job security for life. We will be the personal beneficiaries of Congress’ decision to adopt the law without the pesky hearings that would allow critics to launch devastating attacks on the proposed bill based on a brutally unfair tactic — the presentation of facts. Unfortunately, in our professional capacities, we must oppose the bill. This bill is an atrocity.

“The ‘Jumpstart Our Business Startups’ Act, the comically forced effort to create a catchy acronym, is the most cynical bill to emerge from a cynical Congress and Administration. It is an exemplar of why Congressional approval ratings are well below those of used car dealers. The JOBS Act is something only a financial scavenger could love. It will create a fraud-friendly and fraud-enhancing environment. It will add to the unprecedented level of financial fraud by our most elite CEOS that has devastated the U.S. and European economies and cost over 20 million people their jobs. Financial fraud is a prime jobs killer. …

“Among the many fraud-friendly policies that led to the deregulation that prompts our recurrent, intensifying financial crises, the undisputed most destructive aspect is the recurrent, intensifying embrace of the ‘regulatory race to the bottom.’ The ‘logic’ of the argument in the securities law context is that (1) dishonest issuers like bad regulation because it allows them to defraud with impunity, (2) our ‘competitor’ nations (typically described as the City of London) offer weaker regulation to induce the fraudulent issuers to locate abroad, and (3) we must not allow this to happen; we must make sure that fraudulent issuers are based in America. Of course, they never phrase honestly their ‘logic’ about dishonesty. Four national commissions investigated the causes of financial crises — the S&L debacle, the ongoing U.S. crisis, the Irish crisis, and the Icelandic crisis. Each of the commissions has decried the idiocy of the ‘race to the bottom’ dynamic and warned that it must end. The arguments advanced by industry in support of the JOBS Act reflect and worship at the altar of ‘the race to the bottom.’” http://neweconomicperspectives.org/2012/03/the-jobs-act-is-so-criminogenic-that-it-guarantees-full-time-jobs-for-criminologists.html

http://www.commondreams.org/newswire/2012/04/05-9


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Jobs Act 2012 a Recipe for Fraud
BIll Black: The "Jumpstart Our Business Startups Act" will create a race to the regulatory bottom

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Obama JOBS Act Leaves Labor Fuming In Democratic Feud
April 5, 2012

President Barack Obama will sign the JOBS Act into law Thursday, clinching a rare and hard-fought bipartisan victory for his presidency. But to secure the legislative win, he had to pick sides in a simmering feud between interest groups aligned with the Democratic Party. One side of the fight -- the tech industry and venture capital allies -- is all smiles. But the other side -- organized labor -- is seething.

The flashpoint for this Democratic Party conflict -- the JOBS Act -- is the brainchild of Obama's Council on Jobs and Competitiveness, a 27-member group that the president stacked with 19 corporate chairmen and CEOs in an effort, say labor leaders and others, to curry favor with America’s executive class.

But for all of the maneuvering, the JOBS Act is unlikely to deliver much in the way of job growth, according to economists and consumer advocates, who warn that the bill opens the door to a new wave of conflicts of interest and possible financial fraud on Wall Street.

In practice, however, he bill will be a greater boon for venture capitalists, large tech companies and Wall Street banks. This cadre quickly got the president’s backing for the JOBS Act, despite vocal opposition from consumer advocates, federal regulators and the largest U.S. coalition of labor unions, who warned of increased risk of financial fraud.

Read the full article at:

http://www.huffingtonpost.com/2012/04/05/obama-jobs-act-labor_n_1404401.html


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Obama Signs Regulation-Loosening JOBS Act into Law
Economist: Bill will bring fraud, destroy jobs
by Common Dreams staff
April 5, 2012

President Obama has signed today the regulation-loosening JOBS (Jumpstart Our Business Startups) Act, which one leading economist has referred to as an "anti-jobs act" that will lead to more fraud.

Commenting on the “Jumpstart Our Business Startups” Act, economics and law professor William Black wrote in an open letter signed by other analysts: "The JOBS Act is something only a financial scavenger could love. It will create a fraud-friendly and fraud-enhancing environment. It will add to the unprecedented level of financial fraud by our most elite CEOS that has devastated the U.S. and European economies and cost over 20 million people their jobs.

SEC Commissioner Luis Aguilar also noted in a March 16 speech: "The bill would benefit Wall Street, at the expense of Main Street, by overriding protections that currently require a separation between research analysts and investment bankers who work in the same firm."

Barbara Roper, director of investor protection at the Consumer Federation of America, also sees fraud increasing the passing of the bill. "This legislation will unleash a new wave of damaging investment fraud, undermine market transparency, and increase the cost of capital for the small companies it purports to benefit. Unfortunately, both the administration and a bipartisan majority in Congress have chosen to ignore those warnings."

Read the full article at:

http://www.commondreams.org/headline/2012/04/05-8




President Obama and House Majority Leader Eric Cantor (R-Va.) are all smiles as Jobs Act is signed