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	Goldman Sachs: The bank that rules the world by ProPublica, Bloomberg, agencies   “Regulatory capture” is real – and even worse than we thought, by Richard Eskow.   “Regulatory capture,” is a phenomenon in which the officials who oversee banks become “captured” by the culture, values and opinions of the bankers they’re supposed to regulate.   Secret Goldman Sachs tapes released this week by ProPublica and This American Life are attracting a lot of attention, and rightly so. They were clandestinely recorded by Carmen Segarra, an investigator for the New York Federal Reserve Bank who was eventually fired – either for being uncooperative or, as she says and the tapes suggest, for attempting to be a strong regulator.   Financial cases can seem complicated, especially in situations when there are multiple parties involved. But the reality that is revealed in these tapes is clear enough:   1. The New York Fed’s investigators are surprisingly fearful and defensive.   They’re called “regulators,” although the proper title for the Fed officials who monitor America’s banks is “supervisor.” When it comes to protecting the economy, they’re the cops on the beat. One of the striking things that these tapes make clear is that, rather than being forceful and assertive – in other words, rather than “supervising” – the Fed’s staff is defensive, diffident and afraid to antagonize the bankers they oversee.   The tapes suggest that Mike Silva, Segarra’s boss, wants to do a good job. But he is constantly worried that Goldman Sachs executives might be upset or angered if Segarra or another member of his team becomes too aggressive.   This seems to reflect a culture that comes from higher up in the New York Fed. It’s a culture of submissiveness, not authority. As we will see, there are reasons for that.   2. “Regulatory capture” is real – and even worse than we thought. Fed officials are constantly negotiating the language in their own reports with the bankers they oversee.   This, and the fear that Fed officials display on these tapes, is a conspicuous example of “regulatory capture,” a phenomenon in which the officials who oversee the banks become “captured” by the culture, values and opinions of the bankers they’re supposed to regulate.   Much of that capture is due to the fact that the only well-paying jobs available to ambitious regulators are frequently with the banks themselves. It can also be caused by the human tendency to please those with whom we work.   3. “Embedded” regulators face special challenges.   The problem becomes even worse when regulators or supervisors are “embedded” in the institutions they supervise, as Carmen Segarra was. They go to work, not in their own organizations, but in the offices of the banks they supervise. Most of the people they encounter throughout the day – in the elevator, at the coffee machine, the washroom – are employed by the institution they’re expected to investigate with a skeptical eye.   One Fed supervisor told a consultant that he had only been working in this way for three weeks when “I saw the capture set in.” He was talking about himself.   The tapes show that investigators like Carmen Segarra were rarely given encouragement. They were not provided with the resources that might have helped counteract their isolation and identification with the subjects of their investigations.   4. Self-policing doesn’t work.   One of the great flaws in our bank regulatory system is its reliance on Wall Street institutions to police themselves and voluntarily report misbehavior to the proper authorities. The massive crime wave that led to the 2008 financial crisis demonstrated rather conclusively that these institutions are, as a rule, somewhat disinclined to do so.   This self-policing policy almost inevitably leads to the kind of diffidence displayed by Silva and other regulators. As one unidentified man says on the tapes:   “… we don’t want to discourage Goldman from disclosing these types of things in the future, and therefore maybe you know some comment that says don’t mistake our inquisitiveness, and our desire to understand more about the marketplace in general, as a criticism of you as a firm necessarily. Like I don’t want to, I don’t want to hit them on the bat with the head, and they say screw it we’re not gonna disclose it again, we don’t need to.” “We don’t need to.”   If the regulators themselves don’t think that disclosure is a requirement for bankers, why would the bankers themselves?   5. The Fed’s governance structure is broken.   All of the country’s financial agencies suffer from “regulatory capture,” but the Federal Reserve has another problem. The Fed and its branches, which were created by the United States government, is run by boards largely composed of bank executives and their corporate allies. And the Fed isn’t just an oversight agency.   As a central bank, the Fed is a governmental institution that provides banks with vast financial resources – supposedly in return for compliance with government policies. But when bankers sit on its boards, it has powerful incentives not to look very carefully at its level of compliance.   Jamie Dimon, CEO of scandal-ridden JPMorgan Chase, sat on the Fed board that made the hiring and pay decisions for the its senior officials.   6. Senators Warren and Brown are right. We need public hearings.   Senators Elizabeth Warren and Sherrod Brown reacted to the Segarra tapes by calling for public hearings into the New York Fed’s actions. “It’s our job to make sure our financial regulators are doing their jobs,” said Warren, who added:   “When regulators care more about protecting big banks from accountability than they do about protecting the American people from risky and illegal behavior on Wall Street, it threatens our whole economy. We learned this the hard way in 2008.”   Take a look at its response to a reporter’s detailed list of questions regarding Segarra’s tapes. The reply, which appears to come from Goldman PR man David Wells, flippantly ignores the questions and instead quotes several paragraphs of dialogue from one of those “captured” regulators.   When Segarra was assigned to Goldman, she was appointed to oversee an institution with a record of fraud, deceit, and all-around bad behavior for which it had recently paid a then-record fine. In fact, only Jamie Dimon’s JPMorgan Chase – which is arguably more corrupt than Enron – may have exceeded Goldman in its sheer volume of disgraceful deeds. That’s an important fact to keep in mind when listening to her superiors equivocate and attempt to soften her language.   In an especially disturbing move, Wells remarked that Segarra “unsuccessfully interviewed for employment with Goldman Sachs in 2007, 2008, and 2009.” Perhaps her interviewers found her too ethical for the job? Goldman, on the other hand, is apparently not too ethical to dig into its own personnel files in order to smear a critic.   This particular shot backfires against Goldman. That chronology means that Segarra applied there before joining the New York Fed. That distinguishes her from the many regulators who pursue high-priced banking work after they’ve treated banks with kid gloves. And in a field with limited career choices, her aggressive enforcement posture against Goldman demonstrates her willingness to sacrifice future opportunities in order to serve the public effectively.   As for Wells, his previous PR job was with none other than JPMorgan Chase. People like that are the reason we need people like Carmen Segarra.   http://www.bloombergview.com/articles/2014-09-26/the-secret-goldman-sachs-tapes http://www.thisamericanlife.org/radio-archives/episode/536/the-secret-recordings-of-carmen-segarra http://www.propublica.org/article/carmen-segarras-secret-recordings-from-inside-new-york-fed http://www.ourfuture.org/20141002/7-revelations-from-those-secret-goldman-sachs-tapes   Goldman Sachs: The bank that rules the world   An investigation into the role of one of the most influential banks in the world.   Ever since the stock market crashed, on the night of September 15 2008, the name Goldman Sachs, or GS, has been appearing everywhere: in the collapse of the financial system, the Greek crisis, the plunge of the euro, and the campaign to prevent regulation of financial markets.   The investment bank created in New York in 1868 has carved out its reputation and success by working silently behind the scenes.   But today GS stands accused of myriad charges: playing a key role in the subprime loan fiasco, pushing several of its competitors into bankruptcy, helping countries like Greece hide their deficits before speculating on their downfall, precipitating the fall of the euro, and influencing the consumer price index. And yet GS has come out of this latest crisis richer and more powerful than ever.   http://www.aljazeera.com/indepth/opinion/2014/06/goldman-sachs-too-big-rein-20146179548958530.html http://www.aljazeera.com/programmes/insidestoryamericas/2012/08/2012811102514501222.html
	Human traffic: exposing the brutal organ trade by Joy Ngozi Ezeilo, Nancy Scheper-Hughes New Internationalist & agencies   June 2014   Trafficking for the removal of organs is a real issue, but little is known about it – UN Special Rapporteur.   Available information on trafficking in persons for the removal of organs is inadequate and often unverified, the outgoing United Nations Special Rapporteur on trafficking in persons, Joy Ngozi Ezeilo, said during the presentation of her latest report* to the UN Human Rights Council.   “However, emerging forms of trafficking in persons such as trafficking for the removal of organs do in fact occur in many parts of the world and are not rare,” Ms. Ezeilo emphasized as she urged States and the international community to address the problem with determination.   “This lack of information mainly results from the clandestine nature of the trafficking and from the fact that victims have little opportunity and incentives to denounce such violations,” she said.   The human rights expert stressed that “trafficking in persons for the removal of organs is, first and foremost, a violation of human rights which needs urgent attention from the international community.”   All States have an international legal obligation to prevent this violation, prosecute offenders and protect and assist victims, Ms. Ezeilo noted. “This obligation arises through the application of specialized trafficking in persons laws and through international human rights law,” she said.   “The nature and scope of trafficking in persons have significantly expanded in the past decades,” the Special Rapporteur states in her report. “It is now widely accepted that women, men, boys and girls are trafficked and that the forms of trafficking are as varied as the potential for profit or other personal gain.”   More than US$ 51 billion are generated by human trafficking caused by forced economic exploitation, including domestic work, agriculture and other economic activities, according to the International Labour Organization.   “While women and girls remain the most vulnerable to this plague, men and boys are also victims of these grave human rights violations and their situation need due attention,” the human rights expert said, while urging Governments worldwide to broaden their perception of the problem, including through a more gender balanced and human rights focused approach.   The Special Rapporteur also called on States to focus actively on addressing other emerging and less well-known forms of trafficking, such as illicit recruitment practices, trafficking in men for forced and exploitative labour, trafficking for forced begging and criminal activities, trafficking for forced or servile marriage, as well as safe return and the risk of retrafficking.   In her report to the UN Human Rights Council, which reviews the 10 years of anti-trafficking work of the mandate, the expert highlights the contribution of the mandate to key conceptual and legal gains, especially with regards to the rights of victims of trafficking to effective remedies.   Ms. Ezeilo also identifies remaining challenges such as the need to clarify the international legal definition of trafficking in persons, strengthening the accountability of non-State actors, and involving civil society, victims and vulnerable groups. She offered concrete recommendations to Member States and her successor.   * Special Rapporteur’s report: http://www.ohchr.org/EN/Issues/Trafficking/Pages/annual.aspx http://www.thelancet.com/journals/lancet/article/PIIS0140-6736%2814%2960835-7/fulltext   May 2014   Human traffic: exposing the brutal organ trade, by Nancy Scheper-Hughes.   Secretive and ruthless, the traffickers controlling the kidney trade thrive on the desperation of the poor and the sick. Nancy Scheper-Hughes lays bare the ‘collateral damage’.   The slide on the screen showed several skinny, dark Filipino men lined up, displaying their sacred wound, the kidney scar, long as a sabre slice across their convex torsos. More than 150 representatives of scientific and medical bodies from 78 countries stared solemnly at the photo during the Istanbul Summit of 2008, the defining moment in the global recognition of human trafficking for ‘fresh’ kidneys. ‘Is this why we began as transplant surgeons?’ one of the convenors, US surgeon Francis Delmonico, asked. ‘Are we comfortable with this? Is this fair? Do we want to participate in this?’   The man sitting next to me, a Hindu surgeon in white robes, reminiscent of Hippocrates, was moved. When I asked what he was thinking, he replied: ‘This is too late. Kidney selling is no longer a strange or exotic act. It is normal, everyday, and entrenched. We in the South can agree that it is a tragic turn of events, but the demand comes from outside.’   In the early 1980s a new form of human trafficking, a global trade in kidneys from living persons to supply the needs and demands of ‘transplant tourists’, emerged in the Middle East, Latin America and Asia. The first scientific report on the phenomenon, published in The Lancet in 1990, documented the transplant odysseys of 131 renal patients from three dialysis units in the United Arab Emirates and Oman. They travelled with their private doctors to Bombay (now Mumbai), India, where they were transplanted with kidneys from living ‘suppliers’ organized by local brokers trolling slums and shantytowns. The sellers were paid between $2,000 and $3,000 for a ‘spare’ organ.   On return, these transplant tourists suffered an alarming rate of post-operative complications and mortalities resulting from mismatched organs, and infections including HIV and Hepatitis C. There was no data on, or discussion of, the possible adverse effects on the kidney sellers, who were still an invisible population of anonymous supplier bodies, similar to deceased donors.   In 1997, I co-founded Organs Watch, specifically to draw attention to the then invisible population of kidney ‘suppliers’. Today human trafficking for organs is a vibrant and extremely lucrative business that involves some 50 nations..   Over the course of more than 17 years of dogged field research, my Organs Watch colleagues and I had realized that we were not dealing with a question of medical ethics. Rather, we had gained entry into the world of international organized crime. Following fieldwork in Turkey, Moldova, the US, Israel, Brazil, Argentina, the Philippines and South Africa, it became apparent that organ brokers were human traffickers involved in cut-throat deals that were enforced with violence, if needed. Many of the ‘kidney hunters’ who seek out new candidates in poor localities are former sellers, recruited by crime bosses.   The transplant and organ procurement traffic is far-flung, sophisticated and extremely lucrative. Although trafficking in human organs is illegal in almost every nation, the specifics of the laws differ, making prosecutions that can involve three or more nations a judicial nightmare. In some countries it is illegal to sell a kidney but not to purchase one. In others it is illegal to buy and sell within the country but not to buy and/or sell abroad.   Organ trafficking made its début as a much-contested add-on to the 2000 United Nations Palermo Protocol on Human Trafficking, which recognizes that even willing participants in underworld illicit kidney schemes can be counted as victims. Indeed, most are coerced by need, not physical threats or force. Some even pay significant amounts of money to be trafficked.   As it is covert behaviour, it is difficult to know with any degree of certainty how many people are actually trafficked for their kidneys, but a conservative estimate, based on original research by Organs Watch, is that at least 10,000 kidneys are sold each year. Human trafficking for organs is a relatively small and contained problem, one that could be dealt with efficiently with the political will to do so.   Unlike other forms of trafficking that unite people from shady backgrounds, the organ trade involves those at the highest – or at least middle-class – levels of society: surgeons, doctors, laboratory technicians, travel agents, as well as criminals and outcasts from the lowest.   Transplant professionals are reluctant to ‘name and shame’ those of their colleagues involved in the trade, thereby creating a screen that conceals and even protects the human traffickers who supply the surgeons. And because trafficking living donors for organs is a traffic in ‘goods’ (life-saving ‘fresh kidneys’) not traffic in ‘bads’ (drugs or guns) there is reluctance, even on the part of the justice system, to recognize the ‘collateral damage’ it inflicts on vulnerable bodies – and the harm to society and the profession of medicine itself.   Organ brokers are the linchpins of these criminal networks, which handle an onerous feat of logistics. They co-ordinate three key populations: (1) kidney patients willing to travel great distances and face considerable risk and insecurity; (2) kidney sellers recruited and trafficked from the urban slums and collapsed villages of the poor world; (3) outlaw surgeons willing to break the law and violate professional codes of ethics. Well-connected brokers have access to the necessary infrastructure such as hospitals, transplant centres and medical insurance companies, as well as to local kidney hunters, and brutal enforcers who make sure that ‘willing’ sellers actually get up on the operating table once they realize what the operation actually entails. They can count on both government indifference and police protection.   The complicit medical professionals perform expert teamwork – technicians in the blood and tissue laboratories, dual surgical teams working in tandem, nephrologists and post-operative nurses.   There are ‘transplant tour agencies’ that can organize travel, passports and visas.   In the Middle East and in the US, religious organizations, charitable trusts and patient advocacy groups are often fronts for such international networks.   Some brokers in Moldova used underhand tactics that had already been honed in recruiting naïve Moldovan women into sex work. They offered the opportunity of work abroad to unemployed youth, or household heads in debt or in need of cash to support sick spouses or children.   On arrival, the young men were kept in safe houses, had their passports confiscated, and were reduced to total dependency on the brokers (women were exceptions, see ‘My heart weeps inside me’). A few days later, the brokers would break the news that it was not painting or ironing trousers that was needed from the illegal ‘guest workers’ but their kidneys. Those who refused outright were threatened or beaten. One young man, Vladimir*, explained the stark ‘choice’ that faced him in Istanbul: ‘If I hadn’t given up my kidney to that dog of a surgeon, my body would be floating somewhere in the Bosphorus Strait.’   * Access the full story via the link below. Visit the related web page
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