The Cover-ups of John McCain – Saudi Bank Raiders and Junk Bond Kings

Posted by AZBlueMeanie:

Remember the BCCI bank scandal?  Charles Keating and the Savings & Loan scandal?  Ken Lay and the Enron scandal?  These scandals have all but disappeared down the memory hole for our local yokel political reporters who apparently suffer from amnesia.  John McCain is hoping that voters also have a short memory or suffer from amnesia.

Part 2 of the report by Mark G. Levey explores "McCain’s 30-Years of Service to Saudi Bank Raiders and Junk Bond Kings."  Read the full report here  Election Fraud News.  Snippets from the report:

"From BCCI, to Milken’s Junk Bond Kings, to Jack Abramoff, Senator John McCain has long provided the clean All-American face to the dirty job of cleaning up after the looting of America.

Senator John McCain has made a career out of serving the Kingdom of Saudi Arabia and its army of lobbyists, bagmen, and corrupt bankers during the last three decades.

In the process, he has done his part to cover-up BCCI’s looting of American banks and S&Ls… and more than anyone else, limited the public’s awareness of Jack Abamoff’s wholesale foreign buyout of the GOP, activities that individually have killed the careers of other Washington luminaries. Yet, somehow, John McCain remains the last man standing. He even appears to keep his hands clean.

The Saudi-Manchurian Candidate

The Senator’s patented role as All-American influence peddler to the world now includes the latest flap over his national campaign finance co-chair’s lucrative deals as a Saudi lobbyist and revelations about possible violations of federal campaign laws.

Tom Loeffler, McCain’s finance co-chair received $15 million from Saudi clients since 2002, is just part of a long conduit in the petrodollar pipeline from Riyadh to the Senator from Arizona. The Loeffler Group, which he founded, has also represented the People’s Republic of China.

Under Loeffler, the campaign has brought in more than $50 million for McCain so far this year, far more than was raised during all of 2007 when the GOP candidate faced a weak field of primary competitors. OpenSecrets.com shows that Loeffler and his wife, Nancy, have made a total of fifteen $2,300 maximum personal contributions to McCain during the past year.

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Loeffler last month told a reporter "at no time have I discussed my clients with John McCain." But lobbying disclosure records reviewed by NEWSWEEK show that on May 17, 2006, Loeffler listed meeting McCain along with the Saudi ambassador to "discuss US-Kingdom of Saudi Arabia relations."

Another potential problem: Loeffler’s firm started paying $15,000 a month last summer to one of its lobbyists, Susan Nelson, after she left to become McCain’s full-time finance director, said a source familiar with the arrangement (who asked not to be identified talking about sensitive matters). Campaign officials were told the payments were "severance" for Nelson and that they ended by November. But in "February or March," Loeffler rehired Nelson as a consultant to "help him with his clients" while she continued on the McCain payroll, according to a campaign official who asked not to be identified talking about personnel matters. Federal election law prohibits any outside entity from subsidizing the income of campaign workers.

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McCain is, indeed, in good favor among the Saudi and Gulf elites. Bloomberg reports: Bloomberg.com: Politics ("McCain Iraq, Iran Policies Make Him Favored Candidate to Saudis," By Hans Nichols and Janine Zacharia)

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Like the Bush Family, McCain had his Hand in the BCCI and S&L Scandals

McCain claims that his involvement in the Keating S&L scandal wasn’t really much to worry ourselves about. He was all but exonerated by his Senate colleagues, he says, let off with the political equivalent of a warning at a traffic stop. In fact, the Senate Ethics Committee was rather lenient with all five caught up in the scandal. But, that says more about the nature of the Senate than it does about the actual damage done to the American public by the financial crimes that led to the S&L collapse, itself.

The S&L crisis was all about oil, junk bonds, and deregulation that allowed the two to mix. That volatile brew is still actively bubbling over, and taxpayers are still paying $30 billion annual installments toward the trillion dollar bailout.

Here’s how you got stuck paying the bill, courtesy of the Bush family and John McCain.

In the mid-1980s, world oil prices plunged which set off a long series of bankruptcies and financial takeovers when overvalued Texas and southwestern land prices collapsed. The financial panic of 1988 also followed the “reform” of federal banking rules that had allowed bank managers to trade in risky new derivatives and junk bonds.

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Huge bank holding companies scooped up looted banks and S&Ls (along with their land deeds and oil rights), bought out for pennies on the dollar after they went belly-up. The federal government even subsidized many of these purchases. The American taxpayer was left with an estimated $1 trillion bailout cost. The epicenters of this late 20th Century white collar crime wave were in Houston and Phoenix, home base for two highly ambitious GOP politicians. One was named George H. W. . Bush, and the other John McCain, III.

McCain and BCCI, the Bush Bank

[I]n the final months of the Ford presidency, [CIA Director George H. W.] Bush made a deal with the newly-appointed head of Saudi General Intelligence Directorate, Prince Turki al-Faisal. The two spy chiefs agreed the CIA would look the other way while the Saudis ran their own global operations. In exchange, the Saudis financed the sort of black ops that had been banned by the Democratic Congress after Watergate and the Church Committee hearings. The arrangement was called “The Safari Club” , and the funding mechanism for this was the Bank of Credit and Commerce International, “BCCI”.

Newly-elected President Jimmy Carter fired the CIA Director. In early 1977, Houston banker Joe Allbritton appointed Bush to direct his First International Bancshares (dba, First Interbank) and its London and Luxembourg affiliates. According to Kevin Phillips, Bush’s bank was among the first outposts in America for BCCI.  In the early 1980s, Allbritton followed G. H. W. . to Washington, purchasing Riggs Bank, installing brother Jonathan Bush as a Director.

Riggs closed in 2004 after being fined $25 million dollars for violation of federal money laundering and anti-terrorism laws. Riggs had catered to high-end foreign customers and the diplomatic trade in Washington, as well as having “a relationship” with the CIA.  After 9/11, the bank was found to have transferred money from Saudi Embassy accounts that ended up supporting two of the 9/11 hijackers, Flt. 77 leaders Nawaf al-Hazmi and Khaleed al-Midhar after their arrival in the U.S.

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McCain’s Role in Covering Up the the Trillion Dollar Bank Heist

It’s been said that the American people didn’t become very angry about the S&L crisis because the explanations given for what caused it were too complicated for many to comprehend.  That seems to have set a pattern for financial scandals to follow.

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Buried in all this muck is the thread running through all these financial scandals – from Keating to Silverado to First RepublicBank to BCCI to Enron — has been corrupt management, corrupt officials, corrupt intelligence operatives, and corrupt auditors.

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As the group’s scams became more sophisticated and wide-ranging, the price tag for bail-outs escalated. The federal rescue of Neil Bush’ Silverado S&L cost the taxpayer $1.3 billion. The price tag for Charles Keating’s Lincoln Savings & Loan bailout eventually reached $2.6 billion.  BCCI was termed “the $20-billion-plus heist.” (Beatty, Jonathan; S.C. Gwynne. The Outlaw Bank: A Wild Ride Into the Secret Heart of BCCI Beard Books (1993)). Finally, the Federal Energy Regulatory Commission (FERC) estimated that Enron fleeced ratepayers of $30 billion, creating the 2001 California energy crisis. On November 15, 2005, FERC settled with Enron’s receivers for a mere $1.5 billion.

The Keating S&L scandal was part of a now-familiar pattern of transnational commodities price-fixing, land grabs, stock-price rigging, fraudulent audits, financial panic, and public bailouts, all carried out by an overlapping cast of characters with ties to foreign and domestic intelligence agencies.

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More than a thousand deregulated financial institutions went belly up and were looted. Deregulation allowed crooked bank managers to cash in on the junk bond craze that was sweeping Wall Street. Banks and S&Ls issued unsecured notes and plots of land and traded them in circles with other institutions to ring up the notional value to support cash-out loans for themselves and their partners.

This is precisely the sort of round-robin games that Neil Bush, Director of Silverado S&L played with Charles Keating and his partners, Saudi European Investment Corp’s board and officers – Roger Tamraz, Tolat Othman, Abdullah Taha Bakhsh, Abbas Gokal — along with other BCCI players. All told, the S&L scandal left the American taxpayer holding the tab for an estimated $1 trillion bailout.

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It’s in this context that one needs to re-examine the role of John McCain in the Keating S&L scandal. McCain has always been a conciliator and clean-up specialist – in the case of the Keating S&L, the purpose was to protect a group of junk bond salesmen and Arab bank raiders, but, most of all to shield the Bush wing of the CIA and corrupt lawmakers – and put an attractive, all-American face of “reform” on cleaning up the mess afterwards. This is precisely the cover-up routine McCain repeated twenty years later in the Abramoff case.

McCain and Enron

Throughout his career, McCain has been an enthusiastic champion of financial industry deregulation as a member of the Senate Commerce Committee from 1997-2001 and 2003-2005.

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McCain, like [campaign co-chair Phil] Gramm, has been a supporter of the “Enron Loophole” that allowed Amaranth Advisors hedge fund, a commodities futures trading company, to attempt in 2006 to corner the natural gas market, a criminal violation for which the fund was recently handed a $300 million fine.

McCain also has a direct connection with Enron, having received money in campaign contributions from Ken Lay’s Death Star. "We’re all tainted by the millions and millions of dollars that were contributed by Enron executives," John McCain told CBS’ "Face the Nation" Sunday. McCain then acknowledged receiving $9,500 from Enron in two campaigns.  Gramm’s wife, Wendy, was on the Enron Board of Directors, and Gramm was the architect of much of the “reform” while he chaired the Senate Banking Committee, including a move to exempt electronic trading of electricity from regulatory oversight. According to Time Magazine, Gramm and his wife were at the forefront of many of the illicit practices that led to the firm’s massive rip-offs and ultimate collapse.  For Enron, Washington May Have Been a Bad Investment – TIME

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McCain claims that his role in Keating was merely to help out a local constituent in dealing with Washington bank regulators. McCain, his current wife, and father-in-law were, in fact, Charles Keating’s business partners in a Phoenix shopping mall, received in excess of one hundred thousand dollars in campaign contributions from Keating, and accompanied Keating on his private jet to his private resort in the Bahamas on multiple occasions, gifts which McCain did not report until they were discovered… [McCain] got a slap on the wrist from the Senate Ethics Committee when this came out in the Keating-Five inquiry.

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The 1992 Kerry Commission report concluded that the Keating affair was far more serious than a mere domestic banking scandal: “the financial dealings of BCCI directors with Charles Keating and several Keating affiliates and front-companies, include the possibility that BCCI related entities may have laundered funds for Keating to move them outside the United States.”  Out of the five Senators accused, only McCain and Glenn ever ran again for office, with McCain the sole survivor.