Tuesday, February 12, 2013

Law of the Jungle

Continuing in a long line of truly wretched attorneys general, and not content with his other hobbies of griefing potheads and selling guns to violent Mexican drug cartels, Eric Holder and his DoJ have apparently found their latest high-profile quest:
The complaint, which can be seen here, describes what an FBI agent involved in the case called an “extensive, sophisticated, organized scheme.” A ring of people, ranging from a 31-year-old credit counselor in Philadelphia to a 74-year-old jeweler in northern New Jersey, allegedly conspired to make up fake identities, pump up credit profiles with more false information, and then run up huge unpaid credit-card bills.

All 18 people named in the indictment were charged with the same count of conspiracy to commit fraud, which carries a maximum penalty of 30 years in prison and a $1 million fine. Only 13 have been arrested. One is out of the country, and authorities are looking for the other four, according to a spokesman for the U.S. attorney for New Jersey.

The complaint describes something that resembles a multinational corporation—the enterprise “spanned at least 8 countries” (including Pakistan, India, China, Romania, and Japan), and at least 28 states. It involved the creation of 80 fake companies, more than 1,800 mailing addresses, 7,000 false identities, and 25,000 credit cards. It was as if the alleged fraudsters manufactured a small suburb, in which everyone had good credit at the beginning—only to walk away from big credit-card bills once they maxed out the plastic. The total cost is still being counted. But the U.S. says “final confirmed losses may grow substantially above the present confirmed losses of more than $200 million.”

Credit-card fraud is generally done with existing cards—crooks may hack the number, or get a new card sent to a different address, and then run up a bill until they get cut off. New account fraud is more difficult, time-consuming, but potentially more lucrative. The alleged fraudsters apparently read the personal finance literature on how to build and rebuild credit scores. They would apply for and receive low-spending-limit cards, make a few small purchases and pay down the balance. “This slowly increased the credit score of the false identities,” the complaint notes. Then, after the credit-card companies responded to the good behavior and improved scores by raising the spending limits, they would go on spending rampages and stop paying. This is also known as a bust-out scheme. “It’s not unique,” said Al Pascual, senior analyst at Javelin Strategy & Research. “It’s just that $200 million is huge. A bust out scheme of this scale is unprecedented.”

Ahahahaha. Right, unprecedented. Please, pull the other one. Counting all the unsecured derivatives out there, and the rest of the banksters' little perpetual grift machine, you're looking at probably over $200 trillion worth of potential economic devastation, completely out of control and totally unpenalized (except for the rare Bernie Madoff type who somehow forgot to rent themselves a handy pol or two). It's literally a million times worse than this credit-card fraud scheme, which is certainly sophisticated, but small potatoes in comparison. Yet all the feds do about that is appoint yet another inbred hack, an interchangeable fox to oversee the financial henhouse.

When the next financial collapse comes -- and rest assured, it will, and you and I and every other person not on Wall Street will pay dearly for it -- you can claim to have been distracted, perhaps, but you can't say you haven't been duly warned. The lack of priorities displayed by the authorities should provide enough clues in that regard.


Brian M said...

ROFLOL. (Gasp)

Awesome stuff, Heywood!

Anonymous said...

(nonsequitur alert)

Comic Sans followup: a very interesting defense of Comic Sans, with context and lots of interesting background on typefaces. Worth the time.

(This site has undergone a pretty cool graphic design evolution, btw. I notice it now sports no Comic Sans. (I don't actually hate it, myself...))