Livinglies.wordpress.com| March 26, 2017
By Neil Garfield
CitiGroup’s attempts to act Ethically are a Smoke-Screen for its Fraud Spree.
In last Saturday’s edition of the Wall Street Journal an article entitled, “The Banker-Turned-Seminarian Trying to Save Citigroup’s Soul”. I didn’t projectile vomit but my gag reflex was activated.
Citigroup’s latest attempt to schmooze regulators and the general public by addressing past and ongoing legal and ethical violations is by hiring theologian and Princeton University professor Dr. David Miller to ‘white wash’ its crime spree. Hiring an ethicist at Citigroup is akin to the Vatican consulting on evil prevention with mass-murderer Charles Manson.
Dr. David Miller has been retained as Citi’s “on call ethicist.” Dr. Miller heads Princeton’s Faith & Work Initiative and has worked with Citi over the last three years. He says, “You need banking, just like you need pharmaceuticals.” Interesting analogy considering that both banking and big pharma are more interested in profits than improving your financial, physical or mental health.
Miller will provide “advice and input to senior management.” Is it even possible to instill a sense of ethics in Citi CEO Michael Corbat who endorses Citi’s fraudulent foreclosures by way of fabrication, forgery and deception? Mr. Corbat parroted Miller when he said when faced with an uncertain situation, “ask the four M’s: What would your mother, your mentor, the media and—if you’re inclined—your maker think?” While Corbat was saying all the right things to appease shareholders, his mind was saying, “ask the four M’s: What is your profit motive, your mode of deception, media manipulation and how much money can be made?”
Corbat claims he isn’t worried about the bad employees, but is concerned when good employees justify bad decisions when they face gray-zone questions. When an employee is financially rewarded for denying or revoking a loan modification and for quickly foreclosing on a homeowner- there are going to be a lot of employees caught in that "gray zone". Has Citi changed the incentives that drive the behavior? Not hardly.
Citi operates in an area of gray-zones and black-zones. Citigroup has had numerous issues and has earned a reputation for ethical problems before and after the financial crisis. Mr. Corbat actually feigned shock when the company’s employee surveys showed some workers weren’t comfortable escalating concerns about possible wrongdoing. What could be ethically wrong with sabotaging modifications and work outs or fabricating notes and assignments in order to foreclose? Past Whistleblowers like ex-Citi employee Richard Bowen know all about the consequences of exposing wrong doing at Citi- it is a career ender.
Corbat claims he was shocked by the banking industry’s image problem overall. “If you look today at what the poll numbers say, what the general population says, there is distrust of banks,” Mr. Corbat said in an interview. Is Corbat living under a rock?
The Wall Street Journal reports, “Citigroup is embracing Dr. Miller’s idea (influenced by Plato and Aristotle) of three lenses to apply in ethical decision-making, an approach: Is it right, good and fitting?” In other words, in Citispeak-is it right to gain an advantage, profitable and easy to implement?
Citigroup executives also pose these questions: Is it in our clients’ interest, does it create economic value, and is it systemically responsible?” Who is the client? Fannie Mae or Freddie Mac? It isn’t the homeowner or consumer. These questions actually promote unethical behavior instead of prevent it when posed by upper management who are rewarded for improving Citi's bottom line.
At Lendinglies we have a client who has been in litigation since 2003 with CitiMortgage. To date, Citi has revoked a completed modification, prevented a sale of the home, stripped all of the equity and most recently in mid-appeal altered an Appellee brief by slipping an endorsement onto a note, altering an affidavit, and thus committed fraud and fraud on the court. Citi won the appeal by resorting to fraud and then directed its attorneys to break into the client’s occupied home. The case is ongoing. Citi is probably the most corrupt servicer in America and yet they hide behind the pathetic and obvious ruse of hiring an “ethicist”.
Citi claims they are sharing these ideas with employees worldwide, working these concepts into its ethics and training manuals and mission statement, and posting on the wall of its Manhattan headquarters lobby. This strategy is akin to inviting PETA for a strategy lunch at the Chicago cattle feedlots while trading cattle futures.
Every Citi operation has been cited for fraud and ethical transgressions while fined billions of dollars. Forex issues, currency rigging, bribery, forgery, fraud, racketeering and employee violations are among the violations Citi has faced and yet nothing changes until the next controversy emerges. Just because the devil slips on a halo for the night doesn’t cancel out the horns below. Citi’s culture is ingrained in predatory and fraudulent practices that create an unfair competitive advantage. Discussions about transparency, trust and developing an ethical culture is a smoke screen. Citi is rotten from top to bottom.
Citi has recently started unloading its servicing rights after a decade of fabricating documents, forging signatures, breaking into homes, revoking completed modifications, ignoring bankruptcy automatic stays and grossly destroying the lives of those homeowners who were unfortunate enough to have their servicing rights sold to Citi. Mortgage servicing is a highly profitable activity- especially when you never paid a dime for a loan. Likely the only reason Citi is offloading servicing rights is to create some distance from its fraudulent practices.
Citi is built on a foundation of unfair competition, operating above the law, and by the theft of other’s resources. It is what Citi knows and it is entrenched in Citi’s DNA. The American Bank is free to racketeer, laundry money, rig currencies and break federal law with impunity. If anyone, especially Dr. David Miller thinks an ethics class and a few posters are going to change the Citi corporate culture- your Ph.D. isn’t worth jack.
Evidence shows Citi will not change its culture and has never followed an ethics plan despite implementing others in the past. Citi may have killed many trees to publish its 60-page ethics policy; but only harsh financial penalties coupled with prison time is going to change the American banking industry’s organized crime operation.a
Dr. Miller naively believes banks can change and likely knows very little about how a bank like Citi operates. “To make the assumption that an organization cannot be more ethical than it was is to give up before you start… It is not naive. It is a realistic and necessary goal.” Okay Dr. Miller, let’s see how your Ivy League theories play out in the real world. Most of us on this blog know that your ethical ideologies will never gain traction in an organization built on greed, deception and profits at any cost.
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