A new grassroots group challenging corporate tax dodgers had its inception point on February 26 when US Uncut launched a significant national Day of Action via facebook and twitter. Inspired by the success of UK Uncut, the group formed spontaneous protests mostly at Bank of America branches around the country. Aside from its role in mortgage fraud, Bank of America is among the top tax evaders — the company paid $0 in income tax for 2009 or 2010 — using offshore accounts, bookkeeping gymnastics and loopholes to evade paying any taxes in the country where they do business. If corporations like BofA paid up, the deep cuts in social services being forced upon citizens at state and federal levels would be unnecessary.

I participated in the action in front of the BofA branch in downtown LA. About 40-50 enthusiastic people turned up on a cold and early morning, including a young girl of around 8 years old who led us all in chants of “change” “now.” Photos I took were selected for the cover of The Nation’s slide show as well as Yes! Magazine’s photo essay. Protests were held in 50 cities around the country and a few — such as the one in Washington D.C. — shut down the branch for the day.

The next US Uncut Day of Action is Saturday, March 12 — this time the action in LA is happening in Glendale: 2420 Glendale Blvd @ Siverlake. More days of action are planned for the coming months. For more information, find US Uncut on the web, facebook, or twitter (@USUncut).

Galleries and stories below:

My photo was used for the cover of The Nation’s slide show:

Slide Show: America’s Day of Action: US Uncut and Solidarity with Wisconsin

On Saturday, February 26, progressives carried out a major day of action as protesters from coast to coast joined Wisconsin workers in solidarity against right-wing attacks on union organizing rights, and in fifty cities across the country, the grassroots organization US Uncut debuted as a serious, mobilized effort to fight corporate tax dodging. The combined energy of these protests has fueled a rebirth of impassioned activism, with demonstrators demanding a new focus on economic justice to replace the “cuts, cuts, cuts” mantra the right has used to dominate the national conversation for years.

Another one of my photos was included in Yes! Magazine’s photo essay:

US Uncut: Standing Up to Corporate Tax Dodgers

Inspired by the British movement against corporate tax dodgers, the new grassroots group US Uncut held protests around the country on February 26, most of them in front of Bank of America branches. Why? The bank paid no income taxes in 2009 and 2010. US Uncut is calling out large corporations that find loopholes or use offshore tax havens to evade paying taxes in the country where they do business. If corporations paid up, activists point out, many of the deep cuts in social services happening at the state and federal level wouldn’t be necessary.

February exercise week 4: Honor a good lesson you’ve learned

I was delayed in posting my blog last week as I was relearning a good lesson about pain and beauty — my lower back has been hurting so I couldn’t sit long at the computer, plus I’ve had a cough — oh, how appropriate considering the week’s exercise . More on that in a moment.

I mentioned in my first post on February’s theme that many of the lessons we learn on the planet tend to involve pain. Heartbreak, loss, remorse, injury, betrayal … these gut-wrenching experiences often have us scrambling to throw together bucketfuls of conclusions about the world we experience. These conclusions lead to beliefs about what this world is like and decisions on how we navigate the waters of life so we don’t put ourselves through THAT again.

When we start to unpack complex lessons of heartbreak or betrayal, at the bottom of the pile of the pain-avoidance strategies can be decisions such as: “I’m not going to expect love again” “I won’t trust anyone” “I’ll hold love at arms length” or “I’m not deserving of love.” A subconscious belief of being “undeserving” can affect all aspects of someone’s life — from finances, to health, to relationships. The key realization — we may have made these grand decisions when we we’re all of three years old. Why keep them?

I relearned last week the power forgiveness has to release these kinds of buried beliefs and completely transform seeming disaster. Forgiveness is really a decision to let go of pain you’re holding onto on an energetic level — that’s as simple a way as I can explain it. Forgiveness is an act of self love even more than it is an act of outward compassion. By letting go of your own attachment to the pain that has occurred, you heal. Holding onto pain holds in place the belief of undeserving that leads to yet more pain. If you can take a step back from it, the pattern of recurring pain is like a flag on a Google map showing you an area that needs to be cleared out. Who to forgive? Sometimes that is not even clear. Start with yourself. Expand it to include everyone involved and everyone in your life. You are simply letting go of pain you are holding. It has nothing to do with anyone else. Once your attachment to the pain goes, the energy of acceptance appears and deeper healing can occur.

Paradoxically, there is often resistance to completely releasing pain and the beliefs that underlie it. It raises a question we don’t like to face: “Who am I without this pain?” Our subconscious or ego can use pain and the story that goes with it to define us — it becomes “my story” instead of just “something that happened” at one point in time. The trauma or pattern or cycle is how we’ve come to know ourselves. Have compassion for yourself in this process! (Believe me — says the girl finally clearing intense back pain — I know it can be utterly frustrating!) Once an intention is made to clear away the area where the pain flag was raised, the road blocks can dissolve to experiencing yourself through beauty, even if you don’t know exactly what that even means.

You can purchase a printed copy of my Heal the Money 2011 Colors Calendar to brighten a corner of your world!

All across the US, people are preparing for a Day of Action today, Saturday, February 26 to decry the fact that major corporations dodge billions of dollars in taxes while Congress is pushing hard for cuts to services for low and middle income Americans. This authentic grassroots uprising has been inspired by a Johann Hari article in The Nation published online in early February detailing the success of the spontaneous grassroots movement in Britain calling itself UK Uncut. The article, “How to Build a Progressive Tea Party,” describes how twelve ordinary citizens met in a London pub last fall and — instead of glumly looking around wondering why everyone was just letting themselves be ripped off — they said to themselves, “Why don’t we just do it? Why don’t we just start?”

UK Uncut’s movement — organized on twitter — has managed to successfully shut down branches of tax dodging corporations across the country by peaceful sit ins, called “bail-ins.” Teenagers to pensioners joined in. Hari writes:

A chuckling 64-year-old woman named Mary James said, “The scare stories will say this protest is being hijacked by anarchists. If anything, it’s being hijacked by pensioners!” They stopped passers-by to explain why they were protesting by asking, “Sir, do you pay your taxes? So do I. Did you know that Vodafone doesn’t?”

Taking their cue from the success in Britain, and rallied by recent events in Wisconsin, people across the US have spontaneously coalesced a US Uncut movement. Their first Day of Action is targeting Bank of America branches. Actions are listed here.

“The $3 in my wallet is more than ExxonMobil, GE and Bank of America paid in taxes last year, combined,” said Carl Gibson, founder of US Uncut Mississippi. “There’s a direct connection between corporate tax dodging and what’s happening to real people’s lives. Because of overseas tax havens and other tax loopholes, US corporations are making profits in America but barely paying taxes here. If we close those loopholes, we wouldn’t have to be cutting back on firefighters, library hours and student loans.”

According to the Wall Street Cheat Sheet:

Bank of American (BAC) earned pretax income of $4.4 billion in 2009, yet the financial services super market tallied up a $1.9 billion tax benefit.

How could such a travesty occur? Bank of America scoured the tax code for deductions like $860 million in tax-exempt income, $670 million in low-income housing credits, and a $600 million loss on shares of foreign subsidiaries.

Making matters worse for the US Treasury, Bank of America has a provision for credit losses of $49 billion which will carry over for a long, long time.

According to The Nation, BofA also had accounts in 115 offshore tax havens.

Here in Los Angeles, there’s a US Uncut gathering from 9am to noon at the BofA on 7th St. downtown. For updates, follow @uncutlosangeles on twitter

February exercise week 3: Post three goals on a magic wall

When I was starting high school, I had an idea to write down off the top of my head what I wanted to accomplish in high school — you might say it was my first “to do” list. I put the piece of paper in a book and put the book in a drawer and forgot all about it. Several years later as I was preparing to go to college, I cleaned out that drawer and found the list I’d forgotten I’d written. To my astonishment, I had accomplished every single one of those “to do’s”!

I’d become a dancer in the musicals (I’d had no previous dance training to speak of and my HS was very arts focused, so competition was fierce — I learned to do aerials, for Pete’s sake!), sung in choir and chamber choir, marched in color guard, performed good roles in plays, become an accomplished horseback rider, traveled to Europe … the list went on and on, all accomplished!

Seeing this actually scared me a little. What power this little piece of paper had! I’d made no formal plan to accomplish any of these dreams — I’d simply written them down, held them in my heart and given myself the chance. When auditions and tryouts came up, I signed up. When I earned some money, I set some aside toward a trip. It all magically fell into place.

I’ve demonstrated the power of written goals over and over again in my life — not all of the dreams have come true, but a good many have. Write down three heartfelt goals you have — goals that would bring you joy. I think the joy factor is important. (Note that my HS list was about fun goals rather than grades — and, honestly, accomplishing those joyful experience type goals meant more to me than getting into college. But if stuff like good grades bring you real joy, by all means go for it.) Ask yourself am I okay with having this goal? It doesn’t matter if you don’t know “how” it’s going to happen. If resistance comes up (thoughts like “I’m not good enough,” “I don’t know enough,” “this is impossible”), just accept whatever thoughts and feelings are coming up, and let them go. Put the piece of paper on a wall you pass regularly, maybe on the refrigerator or next to your computer. If you like, you can let your heart know you’re serious by glancing at them and giving these joys an inner nod every now and then. Then give yourself the chance — follow up on opportunities that come your way that lead where you’re heart’s already going.

February is showing itself to be a tumultuous month around the world this year — I’ve been swept up in the fervor of everyday people taking back their power. This energy is both contagious and healthy. This year’s journey is all about taking back one’s power from supposed authorities and choosing instead to create the life you deserve. This article gets us caught up on our year’s journey with the Heal the Money 2011 Colors Calendar.

Save 20% on your purchase through Feb 21! Lulu is having a sale … use coupon code HAPPY305 … so here’s a great opportunity to get one of these calendars to brighten your world.

Here are my thoughts on the exercises suggested for first two weeks of February. As I’ve mentioned before, all of this year’s exercises point you toward healing and can be done anytime throughout the year. They build on each other whatever order you do them.

February’s thought: “Gently choose to know oneself through beauty”

Pain, you have to admit, is a very useful tool. How many of us have not learned a valuable lesson through pain? Pain forces us to pay attention. To focus. To reevaluate. It gets our undivided attention. It often builds compassion and sympathy, insists we care for ourselves, directs us away from a rotten experience, prompts us to choose differently.

Useful as it may be, pain, especially when learned at an early age or through the example of our parents, can become a habit, a reflex. Ever noticed that you have a pattern of having the same painful experience again and again? It might be heartbreaks, conflicts with family, a recurring injury — or, yes, struggles with money. Patterns like this indicate your body and subconscious have come to the conclusion to expect this experience of pain in certain circumstances. It seems as if you have no say in the matter. You’re attracted to the person who will break your heart, you walk right back into the same arguments with family, you step too gingerly and slip once more on the same ankle — or somehow you don’t have enough to cover the bills, again.

Human beings, you might say, are masters at pain. We’ve come to know ourselves very well through this tool. Here’s the epiphany: pain is not the only tool available to us! We can choose to know ourselves through, say, joy, or ease, or beauty. As frustrating as those pain patterns may be, to become aware of them is a grand step forward. The next time you are faced with the approaching circumstances — say the month is beginning and bills are due — first simply acknowledge this is where you have a habit of choosing pain. Accept that it happened, and allow it all to be a habit of the past. This time, declare your intention that you choose from now on to know yourself through beauty.

February exercise week 1: Take a photo of a flower

Flowers are everywhere in California — I am exceptionally fortunate. They crowd almost every fence — an unfolding of hues and astonishing shapes in every pocket of earth, every month of the year. One of my joys has been pausing on my walks to enjoy and take photos of the beauty around me every day here.

I’m not the only one fascinated by flowers. Eckhart Tolle, in the opening paragraphs of his book A New Earth, has these remarkable observations:

Seeing beauty in a flower could awaken humans, however briefly, to the beauty that is an essential part of their own innermost being, their true nature. The first recognition of beauty was one of the most significant events in the evolution of human consciousness. The feelings of joy and love are intrinsically connected to that recognition. Without fully realizing it, flowers would become for us an expression in form of that which is most high, most sacred, and ultimately formless within ourselves. Flowers, more fleeting, more ethereal, and more delicate than the plants out of which they emerged, would become like messengers from another realm, like a bridge between the world of physical forms and the formless. They not only had a scent that was delicate and pleasing to humans, but also brought a fragrance from the realm of spirit. Using the word ‘enlightenment’ in a wider sense than the conventionally accepted one, we could look upon flowers as the enlightenment of plants.

Flowers as the enlightenment of plants — that notion delights me! What a gift indeed they are. Take time this week to observe a flower. Take a photo to honor the moment. As February is a cold month in much of the country, perhaps linger by the flower stand at your local grocery, or look longer than usual at an arrangement in your office, or treat yourself to an early gift of spring at a florist. Take a moment to connect to beauty and ponder the mirror of it. Send me your pics (to suzanne at healthemoneybook.com), if you’d like to share! Here’s my photo :

February exercise week 2: Draw with colored pens or pencils

Play is an expression of joyfulness. So often we can be so concerned with what we need to get done — the tasks at hand, the deadlines to meet — that we dismiss any activities that don’t “make sense” — that don’t have a clear purpose. Though such focus has its usefulness, when we’re in this mode all the time we restrict ourselves and limit our own joy, without even realizing it.

This week, find several large pieces of paper and a bunch of brightly colored pens, pencils or markers — and scribble. Don’t try and draw anything in particular. Don’t have a goal. Just play with the colors and the feel of the pen crossing the paper and your hand moving in unplanned directions. Draw with your non-dominant hand. Trade pens from one hand to the other. Let go of any judgment of what happens. Just connect with what your hands want to do and see how you feel while you’re doing it.

When you open this door to your playfulness, it’s as if a confined horse has suddenly been let out to pasture — it can lope around doing what it was meant to do. Play can return the flow that you’ve been missing. You can open new energies that invigorate and expand possibilities in other areas of your life. The experience honors the creative spirit within you and welcomes it back into your life.

More catch up this week for the calendar journey. I hope those who have ordered the calendar are enjoying it. Let me know! I’ve received plenty of wonderful comments. Of course, you can purchase your own personal calendar to brighten a corner of your world, via Lulu. If you feel inclined, feel free to post an ecstatic, heartwarming or witty review on the Lulu site, here.

January’s theme continues: Love self now — it is the answer to all questions. To review my thoughts on this theme, click here.

January exercise week 3: Let go of beating yourself up

Most of us are masters at beating ourselves up. Listen to people talk. Their stories often burst with self criticism. And those are just the thoughts they verbalize. The inner conversation can be much worse. The habit of self criticism is so deep, we often aren’t even aware of the endless depreciating chatter going on in our heads. An overblown boastful personality or relentless judging of others is often an attempt to drown out the severe internal pummeling going on inside.

This constant dissatisfaction is the voice of ego. The best description of ego I’ve heard is that it’s the energy within you that puts you above or beneath another. It is consumed with jockeying for position. It is never at peace. To ego, our successes are momentary illusions, our failures never die.

Loving self now is both the goal and the remedy to the destructive, obstacle-filled energy of ego. Every moment, every situation we encounter presents us with a choice: a) have compassion, acceptance and love for ourselves, or b) beat ourselves up. This is the secret to life. Out of these moment to moment choices, our lives are constructed. If you are choosing to heal, you need to make a determined decision to choose option “a.” Choosing ego’s option “b” always, always, always digs you into a deeper hole. Despite this truth, ego’s option “b” is such a habit, choosing self love takes a lot of practice. Choose to let go of beating yourself up every time you catch yourself. Smile at yourself instead.

January exercise week 4: Decide all actions take you toward trust in self

Betrayal is a widespread experience in our current time. Much of what we’ve believed in is being severely challenged. From the institutions we rely on — the companies we work for, the banks we deal with, the government we believe we elect — to the expectations we’ve held for our lives, the foundations of our world are getting a good shake up. The revelation of so much deceit and collapse is raising a grand question in most of us: what can I trust?

The shake up is unearthing an even deeper betrayal — feeling that we’ve betrayed ourselves. Why in the world did I trust this institution? How foolish could I have been? How did I let myself be hoodwinked? How could I have let this happen? Why did I put up with this for so long? Why didn’t I see this coming?

We have been turning over power to supposed authorities, many of whom are revealing themselves not to be on our side. In a certain sense, this is a mirror of our inner world: we have been turning over power to our egos — we’ve allowed this ever-critical, never-satisfied aspect of ourselves to run our lives. We are beginning to see that ego is not, after all, truly on our side. All ego creates is endless obstacles and drama. But if this voice in our head is not to be listened to, who, then, do we trust? Giving yourself love quiets the mind. By doing this, we can hear and build trust in our wiser intuition. Decide to honor your best self — it’s inside behind the judgmental chatter and fear. Decide that each step in your life now will take you toward trusting this wise and courageous self — it is the part of you that will lead you to true happiness.

January exercise week 5: Curl up with a good book

In this world of twitter, txts and video overload, we can forget the experience of enjoying the quiet world of imagination. The journeys the mind and emotions take with a good book often far surpass even a great film — imaginations are exceptionally personal and unbounded by the budgets or casting quirks of Hollywood. Give yourself the chance to settle in a quiet corner in a favorite chair, undisturbed for a block of time, to begin a new journey this week.

Thank you for bearing with me as I get oriented for how best to take this year’s calendar journey — I’ve committed to writing short weekly posts to correspond to the suggested weekly exercises in my Heal the Money 2011 Colors Calendar. The powerful journey this year will strengthen your connection to your own source of worth and happiness. You can join in any time during the year, whether or not you purchase the calendar itself. Of course, if you do like the calendar and feel what I’m doing is worthwhile, your purchase supports everything I’m doing — thank you! It’s available on Lulu.com.

I aim to keep these calendar blog posts to a few paragraphs — I’ll do my best to distill what I think the exercise value is and add an insight from my own life when useful. Please share your own experiences, if you like, in the comments.

Since I’m doing a bit of catch up, I’ll cover two of the exercises today from January.

All of this year’s exercises, by the way, point you toward healing and can be done anytime throughout the year, of course. They build on each other whatever order you do them. Adding them into a calendar simply helps you to keep on the path.

January’s thought: “Love self now — it is the answer to all questions”

Love self now — it is the answer to all questions. That profound thought is the path of healing throughout my book Heal the Money. It came to me as I began to write this book and began to delve deeply into the source of my own serious struggles around money. Honestly, at the time I wrote it down, I didn’t fully appreciate the depth of what it told me. It felt tremendously profound, but rather simple, and how did it relate to money, exactly? I didn’t quite get it.

In the several years I have been writing, the power of the answer it gives has moved me to tears countless times as the resonance of where it points me — within to my own self love, and to the power I hold to love myself at any moment, no matter what — has healed challenge after seemingly disastrous, impossible challenge in my life.

I’ve come to realize that knowing we have this power over our own experience and becoming skilled in applying it is what so many of us are really seeking in this life. We have been granting the outside world power over us that we can choose not to grant it anymore. We have been granting money a power over us that we can choose not to grant it anymore. It is a big shift, but it is a tremendously worthy journey.

To love self now, I now know, entails becoming at peace with what is, accepting without judgment the present moment. In our ever-judgmental society, it is perhaps the most difficult of all things to do. But the power of being at peace is immense. Once there, you can choose with ease what you create for yourself — and that is mastery.

January exercise week 1: Forgive yourself for something

So many people who have struggled or are struggling with money have in their memory a bad experience or decision they made about money that brings up pain and fear, or lack and self judgment. Often at the bottom of these memories are feelings of “not enough”: a feeling such as, “I wasn’t enough to handle that situation or understand the best course of action for myself and it all turned out badly.” Often we bury these feelings.

But when there are buried feelings, they become the lenses through which we see the world. The energy of them affects our thoughts and decisions now. We are far more likely to expect pain and lack to happen again, and so we act in ways that recreate exactly the same experiences.

It’s important to recognize these holdover memories that affect our ability to walk confidently forward in the present moment. Being courageous enough to face these feelings and forgive ourselves can free up a great deal of energy. Honor that experience for what it was. Allow it to be something of the past. Know you can choose this time to create a reflection of greater self love instead. You don’t need to recreate that old pain. This week, choose a key money decision that you still beat yourself up about and decide to forgive yourself.

January exercise week 2: Take yourself out on a date

Sometimes, we need to treat ourselves. So many times we can find ourselves accommodating others’ schedules and needs. While being accommodating is a healthy quality, it if becomes out of balance, we can feel we bend ourselves entirely around other people’s lives. To love ourselves, it is equally important to give a listen and kind serious attention to our own preferences, needs, and what makes us happy.

For this exercise, devise a dream date for yourself. Put yourself in the shoes of someone who so enjoys just being with you, that he or she wants to give you the best date of your life. This person sees who you really are and what you really love. Tune into yourself, imagine, plan and think creatively to put together that date. Is it karaoke? A winery? Making snow angels? Dancing? Riding bikes on the beach? Gazing at the moon through a telescope? Learning guitar from a master?

Now this person is not trying to impress you — there’s a difference between wanting to impress and wanting to delight. This date is not about them. He or she simply wants you to thoroughly enjoy yourself and feel loved and seen and understood. Budget? You decide. Challenge yourself, if you like, to do the best date ever without spending any money at all. Spend several days or a whole week dreaming of what that would be. Then take yourself out!

I’m thrilled to announce that I have published the first of several offerings I have in mind to help people heal how money functions in their lives. This first one is a calendar / year’s journey around some of the useful principles in the book I’m writing. While the book, Heal the Money, goes into much of the reasons and circumstance for how we got to where we are now, I chose to focus the calendar on healing. Each week has simple suggested exercises to lead you toward clearing the past and focusing on joy. I’ll be posting blog articles weekly here that correspond to that week’s calendar exercise. You can interact with others and post your thoughts and experiences here.

Please take a look! If you like it, I’d love some reviews and some good ratings on the site — Lulu.com. The publisher has a very good reputation for quality printing too, so you can pick up that extra calendar you’ve been looking for to hang in a spot that could use some brightening. You can see a preview on the site of all the pages.

And please share! It would help me out a great deal.

Heal the Money 2011 Colors Calendar — available on Lulu.com

Heal the Money 2011 Colors Calendar brings the joy of color and flowers into your life each month along with phrases from Suzanne O’Keeffe’s book Heal the Money. The ideas and the simple weekly exercises walk you through a powerful journey that strengthens your connection to your own source of worth and happiness. Beyond the realm of budgets, FICO scores and interest rates, the purpose of money is to support your happiness. Get back to the basics of what makes you actually happy. Learn to stop identifying with difficulty and lack, let go of worries and fears, and stop beating yourself up. Move more powerfully in creating the world you deserve. Connect with others and get more guidance each week on HealTheMoneyBook.com

This article was published December 17, 2010 on Huffington Post here.

Photo by Taber Andrew Bain licensed under Creative Commons license.

To combat mortgage and foreclosure fraud, we first need to understand the nature of the fraud. There are the small-potato schemes — the loan modification-aid scams, or the scams of fraudsters busting into foreclosed properties and renting them out. Yes, people get burned this way, but going after these frauds is like prosecuting the drug dealer on the corner, if you will.

The true nature of the fraud — the kingpin level, so to speak — is found in the current nature and structure of the financial / mortgage / foreclosure system itself. And that level of investigation is what the FBI carefully tip-toed around discussing at Wednesday’s Mortgage Fraud Summit that took place in Ontario, Ca.

California is one of the epicenters of mortgage trouble. According to the FBI, 24% of properties in the US are now underwater. Of those properties, 40% sit in California or Florida. San Bernardino County has one of the highest rates of foreclosures in the nation — one in 114 homes is in foreclosure. To help homeowners battling to save their homes, two grassroots groups — nonprofit Rhema Economic Research and Development and the Grassroots Assembly for Mortgage Fraud Victims — brought in an impressive array of authors and panelists.

What became clear from the presentations and discussion is that the FBI now seems more concerned by the fraud at the bottom of the chain instead of spending their energies and resources investigating the control fraud becoming evident throughout the entire system.

The FBI, to its credit, warned about the “epidemic of mortgage fraud” way back in 2004.  At the time, they were accused of being Chicken Little.

Where has that vigor gone? Sharon Ormsby — chief of all financial / white collar crimes for the FBI — came all the way to California to tell the crowd that robo-signing and foreclosure mills are mere “issues of concern.”

Instead, Ormsby lapsed into Bureau-speak. Yes, Operation Stolen Dreams — a mortgage fraud takedown earlier this year — recovered $11 million and led to over 330 convictions, the largest white collar crime takedown in this country. Yes, they have more forensic accountants and are seizing more assets of the white collar criminals.

But she lost me and the audience: Where’s the action on the institutions committing this systemic fraud so many are confronting right here, right now? What are all the task forces and cross-department working groups doing to help those about to lose their homes because of it?

“Is BofA being investigated now?” an audience member asked Ormsby. … Silence.

Ormsby was rescued by Joan Hobbs from HUD’s Office of the Inspector General who jumped up to chirp there were “a lot of investigations going on now on Countrywide files.” She described an audit ongoing in Chicago and said they are about to open up a nationwide audit on Countrywide loans. BofA, she said, has agreed to be financially responsible.

Any criminal investigations? Any kingpin bankers about to be thrown in jail? No mention.

When asked about the culpability of the CEOs presiding over and reaping billions from this fraud-filled system, Ormsby simply fired back “Where’s the proof?”

The audience audibly winced.

We had just heard heavy-hitting speakers William K. Black and Nomi Prins go into great detail about where the fraud occurs and how the Ponzi scheme works. Black is a criminologist, law and economics professor and was the bank regulator who brought down Charles Keating Jr. in the Savings and Loan investigations in the 80s. Prins is an ex managing director at Goldman Sachs and Bear Stearns. They know what they’re talking about.

From the audience, story after story surfaced of banks giving homeowners the run around, missing or fraudulent documentation, delay tactics, purposeful misrepresentation of process, refusal to communicate or provide statements, wrongful fees and altered interest rates, altered agreements, fraudulent second mortgages that the homeowner never took out… and all this from a room with only a few dozen people — a small sampling of what looks to be vast systemic malfunction.

To help homeowners, the Grassroots Assembly organization described the launch of a website homeowners can use to help check their own documents for fraud. CheckTheLoanDocs.com will provide templates to help homeowners interpret and organize loan documents and guide them to next steps if any discrepancies are discovered.

But where’s an Eliott Ness when you need one?

Has the fraud come from the top? That’s been the consistent conclusion of various State Attorney General investigations.

Where is the fraud? William K. Black — beamed in via Skype — explained the recipe for these control frauds. “Control fraud” is a concept developed by Black to describe frauds in which the people who control seemingly legitimate organizations can commit fraud with impunity.

First, their primary weapon is accounting. The goal in the mortgage area is to create fictional accounting income that maximizes real executive bonuses, which are based on fictional accounting income. The recipe to do that — which became the standard recipe, Black said — is this:

1. Lender grows extremely rapidly
2. Make really bad loans to people who often won’t be able to repay them — make these loans at predatory rates
3. Have extreme leverage: a great deal of debt compared to company equity
4. Have only trivial loss reserves, so when the day of reckoning occurs, there are no reserves to pay for the losses — those losses will go to the taxpayers and the creditors

If you follow this recipe, as Nobel prize-winner George Akerlof said in 1993, “it’s a sure thing” — you are mathematically guaranteed to report record profits.

Prins described what she called the inverted pyramid of profits erected on the backs of these sub-prime loans.

“At the bottom of the pyramid is the homeowner. That’s only a teeny, teeny portion, of the entire mortgage crisis. An immense amount of profits were made on the back of that tiny little point. Because after the loan is made, it’s sold, and it’s packaged, and it’s repackaged, and it’s traded, and it’s resold.

“All the way up this pyramid, at every single layer, the biggest banks are making money — they’re taking a cut. Banks make fees for the home sale, banks make fees on the interest, banks resell that loan to another bank, or to another company. They package it into something that we’ve come to know as a toxic asset. Pieces of that package are sold to investors, or to pension funds in Iceland, or to asset managers in England. They’re trading those pieces back and forth — repackaging the same loan. Packages of loans were used as collateral for other loans — until that home is really invisible in this scheme. One house might be backing 30 different securities — one house.

“If you follow that money, you get to mega bonuses on Wall Street …

“So what’s happening at the bottom of the pyramid, to a bank, is almost irrelevant. Because by the time this one loan — this home — gets diffused into this upside down pyramid the banks have made so much money that they’re not even concerned whether or not the loan is repaid. Yet many of these homes are being foreclosed upon.

“Each transaction, though, has a promise inside of it that this little loan is going to pay its interest, and that interest is going to get spread along all of the layers. That’s really the fraud of the whole system … because when any of those interest payments stop, when anyone is defaulting on a loan, a lot of the money has already been made. That’s why banks don’t have an incentive to work with people to renegotiate those loans or help with ways of reducing the principle. Because they don’t care — they’ve made all of this money. There’s no incentive to go back to the beginning of that chain of money and recreate. There’s no financial incentive, forget moral incentive.”

Black also described the abundant evidence of fraud in step after step of the mortgage and foreclosure process as lenders followed the recipe for guaranteed record profits:

Fraudulent Appraisals:

One of the key fraud devises, Black said, is to massively inflate appraisals. Polls show that 90% of appraisers in a single year were subjected to acts of intimidation to inflate appraisals — that intimidation came almost exclusively from lenders. Then NY Attorney General, now Governor, Andrew Cuomo found that Washington Mutual had a blacklist of appraisers — but you got on the blacklist if you refused to inflate appraisals. If the appraisers were honest, they didn’t get the job.

Knowingly Pushing Bad Loans:

Incentive structures for loan brokers were based on how many bad loans you were making and for which you could charge a really high premium interest rate. Lenders gave loans to people they knew at the time of the approval would not be able to repay them.

False Financial Statements and Applications:

The mortgage industry’s own anti-fraud specialists issued a report in 2006 saying that loan brokers were overwhelmingly preparing false financial statements and false financial applications. Fraud was occurring 80% of the time.

Liars Loans Continued:

After the report came out, the industry didn’t change what they were doing. Exactly the opposite — liars loans grew massively. By the end of 2006, 49% of all new loans in the US were liars loans, in which the bank would not check the accuracy of statements.

“Missing” Documents:

Lenders frequently did not keep key records as a matter of business because they didn’t want to make it easy for prosecutors to demonstrate the fraud. They didn’t want to have in their records documents to show they knew the loan was being made to someone who couldn’t pay. It also costs money to do proper paperwork and they didn’t want to spend it.

Fraudulent Documents:

What happens, then, Black asked, when the lender needs to foreclose? When loans are willfully  made to those who won’t be able to pay, a great deal of foreclosures are inevitable. But the necessary documents are missing, because lenders didn’t want evidence lying around. Or with all the reselling and repackaging, the trail has been lost. So to foreclose, the documents need to be recreated. An epidemic of false affidavits has appeared as a result. The practice is so widespread that “document mills” now exist that can fabricate an entire mortgage file for $95.

There’s more. Black didn’t mention the fraudulent AAA ratings given by the ratings agencies to toxic assets so bad loan packages could be sold to pension funds.

As William Black put it:

“[Lenders] start creating false statements, false affidavits. That means a false statement under penalty of perjury. That means a felony. That means tens of thousands of cases every month of Bank of America and other entities like it committing felonies.“

Correct me if I’m wrong, but I think that any likelihood that tens of thousands of felonies are being committed every month by major banking institutions via false affidavits should damn well get the issue off the FBI’s “concern” pile and onto the “immediate action” burner.

According to Black, so far the Office of the Comptroller of Currency and the Office of Thrift Supervision — both are bureaus within the Department of Treasury — have made zero criminal referrals against the lenders that specialize in making these fraudulent loans.

Perhaps the FBI is conducting kingpin-level criminal investigations that Ormsby was obliged to be silent about. Certainly nothing was mentioned here.

Maybe the FBI needs a few whistle blowers to fire them some evidence. Ormsby did leave that door open, saying that the FBI relies on information from the public.

Ormsby also hinted at a potential avenue for citizen action: She is obligated to act on issues brought to her by a member of Congress. So homeowners and others who care about clearing the control fraud from this system can apply pressure to those in Congress likely to be receptive and tell them to give Ormsby a call: put mortgage and foreclosure control fraud on the FBI’s front burner.

Credit: Sony Pictures Classics

Charles Ferguson’s film Inside Job is brilliant filmmaking that explains clearly and emphatically how the easiest way to rob a bank is to own one. Ferguson exposes the bullshit behind the crafted headlines of the financial collapse, from the tycoons at the head of Iceland’s economic implosion, to the stuffy self-important academics loathe to question their own ethics. He interviews Wall Street sex workers and psychotherapists, exposes the rampant drug use and lack of business or personal ethics, and shows the vast chasm between the world of these industry titans and the lives of the people their purposeful scheming has destroyed. All the set pieces to this bank job did their assignments, our “Wall Street government” played both sides of the aisle. They set out to defraud us, and they’ve pulled it off — so far.

“These people are risk takers, they’re impulsive. I see a lot of cocaine use, prostitution.” Jonathan Alpert, Manhattan psychotherapist

Beautifully shot and scored, revealingly edited — the shots of pundits fussing with their lavaliere mics speak volumes — the film is the opposite of dry. It is a compelling, well written heist film — only this time, the pit in your stomach reminds you you’re one of those whose bank account has been cleverly siphoned clean.

What you can’t understand, at the end of it all, is why the world has put up with this bullying. The absurdity of the ratings agencies’ testimonies before Congress is a case in point. Each agency — they clearly got together in the bathroom beforehand to get their stories straight — claimed before a dumbstruck House Financial Services Committee that their all-important investment-grade ratings, doled out like candy to favored clients, amount to nothing more than mere “opinions,” and are therefore protected by the first amendment. Instead of handcuffing the agency CEOs on the spot and throwing the book at them, the House Committee backed obediently down.

Ferguson doesn’t. One of the greatly satisfying experiences of watching this film is hearing Ferguson stand up to these bullies. He throws them hardball questions and we watch them dodge and weave, squirming in agony, clearly unaccustomed to being interviewed by anyone who has done their homework. “You can’t be serious,” Ferguson blurts off screen at one outrageous answer — just as we would. The titans and the apologists shift, they fuss, they look away, they get flustered, they get demanding and, glory be, Ferguson doesn’t flinch. You feel, finally, there’s an adult in the room.

“What can we believe in? There’s nothing we can trust anymore.” Gillian Tett, Financial Times journalist

Though Ferguson’s film is short on solutions, there is hope in its distribution. People will see it. People will tell their friends. If there’s one thing the American people have in common it’s that they have little tolerance for criminals in high places. The common awareness of the current state of things will push us to innovate a path to take our power back from this industry.

Find a theater near you.