Category: Banking

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Karen Hudes Warns the World On the brink of a Currency War and at the edge of World War 3

Karen Hudes

https://www.facebook.com/karen.hudes.9

Biography:

Karen Hudes studied law at Yale Law School and economics at the University of Amsterdam. She worked in the US Export Import Bank of the US from 1980-1985 and in the Legal Department of the World Bank from 1986-2007. She established the Non Governmental Organization Committee of the International Law Section of the American Bar Association and the Committee on Multilateralism and the Accountability of International Organizations of the American Branch of the International Law Association.

In 2007 Karen warned the US Treasury Department and US Congress that the US would lose its right to appoint the President of the World Bank if the current American President of the World Bank did not play by the rules. The 66 year old Gentlemen’s Agreement that Europe would appoint the Managing Director of the IMF and US would appoint the World Bank President ended in 2010.

Bank Corruption

Date: 05-25-13
Host: John B. Wells
Guests: Karen Hudes

Joining John B. Wells, former World Bank attorney and whistleblower Karen Hudestalked about how she uncovered corruption in the World Bank.

Who is Karen Hudes?

Karen Hudes studied law at Yale Law School and economics at the University of Amsterdam. She worked in the US Export Import Bank of the US from 1980-1985 and in the Legal Department of the World Bank from 1986-2007. She established the Non Governmental Organization Committee of the International Law Section of the American Bar Association and the Committee on Multilateralism and the Accountability of International Organizations of the American Branch of the International Law Association.

What did Karen Hudes blow the whistle on?

In 2007 Karen warned the US Treasury Department and US Congress that the US would lose its right to appoint the President of the World Bank if the current American President of the World Bank did not play by the rules. The 66 year old Gentlemen’s Agreement that Europe would appoint the Managing Director of the IMF and US would appoint the World Bank President ended in 2010http://www.imf.org/external/np/cm/2010/042510.htm

In 1999 Karen reported the corrupt take-over of the second largest bank in the Philippines. Lucio Tan, a crony of Joseph Estrada, then President of the Philippines, acquired stock owned by government employees in Philippines National Bank (“PNB”) valued more than 10% of PNB’s outstanding capital without disclosure, as required by Philippines securities laws. Tan owned Philippines Airlines, in default on its loans from PNB. The government of the Philippines loaned $493 million to PNB after PNB’s depositors made heavy withdrawals. $200 million of a loan from the World Bank and a $200 million loan from Japan were cancelled. Estrada was ultimately impeached, and in 2007 an anti-corruption court in the Philippines required Estrada to refund graft he had plundered. The Bank’s Country Director in the Philippines reassigned Karen when she asked him to sign a letter warning the Philippines’ government that the Bank could not disburse its loan without a waiver from the Board of Executive Directors since the loan conditionality was not met. The World Bank’s Internal Audit Department refused to correct the satisfactory evaluation of the Bank’s supervision performance or the flawed report of the Institutional Integrity Department to the Audit Committee of the Board of Executive Directors. When the Audit Committee requested an audit of internal controls over financial reporting, KPMG, the external auditors, circumscribed the scope of their audit in violation of Generally Accepted Accounting Principles and Generally Accepted Auditing Standards.

Two days after informing the Board’s Audit Committee of the cover-up in the Philippines, Karen was reprimanded and placed on probation. The Dutch Ministry of Foreign Affairs requested the World Bank’s Audit Committee to look into the cover- up. Instead, the Chair of the World Bank’s Audit Committee requested an inquiry into the World Bank’s Institutional Integrity Department. The Senate Committee on Foreign Relations followed up with three letters to the World Bank. The World Bank forged documents and fired Karen in contempt of Congress. The World Bank also fired the Staff Association’s lawyer. The Staff Association stated that what had happened to Karen had damaged staff morale and prevented others from reporting misconduct. The World Bank’s Ethics’ Officer left in frustration after her request for an investigation by the World Bank’s Institutional Integrity Department was turned down.

Mr. Paul Volcker headed the 2007 inquiry into the Institutional Integrity Department. The Volcker Panel was discredited after sixteen staff employed in the Institutional Integrity Department received significant damage awards in compensation for abuses of authority to intimidate them during the Volker Panel investigation. A staff-member of the EU’s anti-fraud agency, Office Lutte Anti-Fraude, on the Volcker Panel wrote to Karen:
“My Director General and I met with a number of European Executive Directors of the World Bank a few weeks ago to discuss the Volcker Panel report. At the meeting there was also discussion about governance issues. My impression was that the European Executive Directors are well apprised of all relevant issues at the Bank and no further comment by OLAF is warranted even if it was within our legal competence.”

Karen informed Senator Bayh, “[t]he ongoing cover-up is an indictment of the probity of US oversight at the Bank and I would encourage the Senate to request GAO to look into it.” Senators Richard Lugar, Evan Bayh and Patrick Leahy requested GAO to investigate “internal resistance to increased transparency and accountability at the World Bank.” http://citizenoversight.com/pdf/blwb.pdf In 2008 Karen’s Congressman, Representative Chris Van Hollen, noted “that [Karen’s] claims and concerns have already been provided to the GAO…. and to the relevant congressional committees.” In 2009 GAO stated that it could not commence the inquiry “because of challenges we recently faced in gaining access to World Bank officials.” Senator Lugar asked what was delaying the GAO review during hearings on the World Bank’s capital increase.

Mr. Pieter Stek, then Executive Director for the Netherlands, and Chair of the Board Committee on Development Effectiveness, said:
“In a multilateral institution which should be governed by the rule of law and high standards of probity the charge of concealment from the Board of Executive Directors of information relevant to the exercise of its duty of supervising management and the persecution of the person who brings this to light is extremely serious. If correct, which I believe, this poisonous cocktail undermines good governance and ultimately the effectiveness of the Bank in fulfilling its mandate. I shall continue to assist Ms. Hudes in her efforts to have due process brought to bear, preferably by the Bank itself, on these issues of governance.”

David Brooks wrote:
“Then there are violations, when someone intentionally breaks the rules. Errors can be very hard for outsiders to detect. It was people inside the companies who were most likely to report fraud, because they have local knowledge. And yet 80 percent of these whistleblowers regret having reported the crimes because of the negative consequences they suffered. This is not the way to treat people who detect error.” http://brooks.blogs.nytimes.com/2011/06/13/living-with-mistakes/?comments#permid=34

Appeal

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

  • KAREN HUDES,
  • Appellant,
  • v.
  • AETNA LIFE INSURANCE COMPANY,
  • INTERNATIONAL BANK FOR
  • RECONSTRUCTION AND
  • DEVELOPMENT,
  • KPMG LLP,
  • AND
  • MARK E. SCHREIBER,
  • Appellees
No. 11-7109

GENERAL DOCKET FOR CASE #: 11-7109

11/14/2011 View Details Motion filed by International Bank for Reconstruction and Development for summary affirmance.
12/02/2011 View Details
Exhibits		 Response in Opposition filed by Karen Hudes
12/12/2011 View Details Reply filed by International Bank for Reconstruction and
Development to response
3/8/2012 View Details Per Curiam Order filed denying motion for summary affirmance
3/9/2012 View Details Clerk’s Order filed directing party to file briefing format
4/23/2012 View Details Motion filed by Karen Hudes to extend time to file response to court order.
5/2/2012 View Details Motion filed by Karen Hudes to extend time to file response
7/9/2012 View Details Court’s 6/15/2012 offer of mediation turned down by IBRD, KPMG, Aetna and Schreiber.
8/06/2012 View Details
Exhibits		 Karen Hudes’ Opening Brief
9/05/2012 View Details Brief filed by International Bank for Reconstruction and Development
9/05/2012 View Details Brief filed by KPMG
9/05/2012 View Details Brief filed by Aetna
9/05/2012 View Details Brief filed by Schreiber
7/9/2012 View Details Court’s Order Scheduling Oral Argument for November 6, 2012
9/19/2012 View Details Karen Hudes’ Reply Brief
11/2/2012 View Details Court Order Cancelling Oral Arguments
11/20/2012 View Details Unpublished Opinion Affirming District Court
1/19/2012 View Details Request to Judicial Conference to correct court records

IN THE US DISTRICT COURT
DISTRICT OF COLUMBIA

  • Karen Hudes
  • 5203 Falmouth Road
  • Bethesda, MD 20816,
  • Plaintiff,
  • vs.
  • Aetna Life Insurance Company
  • 151 Farmington Avenue
  • Hartford, CT 06156,
  • Mark E. Schreiber
  • Edwards Angell Palmer & Dodge
  • 111 Huntington Avenue
  • Boston, MA 02199-7613,
  • International Bank for Recon-
  • struction and Development,
  • 1818 H Street, N.W.
  • Washington, DC 20433,
  • KPMG LLP,
  • c/o The Corporation Trust Company
  • 1209 Orange Street
  • Wilmington, DE 19801,
  • and
  • John and Jane Does 1-99,
  • Defendants.
Civil No.: 10-1444 JEB

CIVIL DOCKET FOR CASE #: 1:10-cv-01444-JEB

04/13/2010 View Details
Exhibits		 RESPONSE to Motion re 15 MOTION to Dismiss for Lack of Jurisdiction filed by Karen Hudes. Replies due by 04/30/2010. (elts, Deputy Clerk) [Transferred from Maryland on 8/26/2010.] (Entered: 04/30/2010)
10/15/2010 View Details AMENDED COMPLAINT against AETNA LIFE INSURANCE CO., INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT, MARK E. SCHREIBER, KPMG LLP filed by KAREN HUDES.(rdj) (Entered: 10/19/2010)
01/17/2011 View Details Memorandum in opposition to re 58 MOTION to Dismiss and Sever MOTION to Sever MOTION for Hearing, 57 MOTION to Dismiss Second Amended Complaint, 59 MOTION to DismissPlaintiffs Second Amended Complaint, 54 MOTION to Dismiss Plaintiff’s Second Amended Complaint filed by KAREN HUDES. (Attachments: # 1 Memorandum in Support, # 2 Exhibit)(Hudes, Karen) (Entered: 01/17/2011)
08/30/2011 View Details ORDER granting 54 Aetna Life Ins. Co.’s Motion to Dismiss; granting 57 Mark Schreiber’s Motion to Dismiss; granting 58 KPMG’s Motion to Dismiss; granting 59 IBRD’s Motion to Dismiss. The Court ORDERS that: (1) Defendants’ Motions to Dismiss are GRANTED WITH PREJUDICE as to all federal claims against all Defendants, and as to Plaintiff’s wrongful-termination claim against the World Bank; and (2) Defendants’ Motions to Dismiss are GRANTED WITHOUT PREJUDICE as to all other Maryland and state common-law claims. Signed by Judge James E. Boasberg on 8/30/2011. (lcjeb1) (Entered: 08/30/2011) Hudes v. Aetna Life Ins. Co., et al, 806 F. Supp 2d 180
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Get your Money Out Of The Bank Now Before Its To Late Global Economic Collapse Is Eminate First Domino Has Fallen EU’s Cyprus!

Hence·forth  the chaos and confusion in the world of banking!  The End game has started Cyprus, and Europe, it comes as no surprise that the previously scheduled Monday bank holiday (aka Green Monday) has been extended into Tuesday.  So all we see in the News is how the Dow keeps going up and the American Economy is picking up steam.  When the truth is that its all just a bunch of hot air.  Anyone who understands the world banking history, knows that history is about to repeats itself it could be with in a few months to a few years a way till the big crash.

Cyprus Bank Holiday extended until Wednesday …to stop runs on the Cyprus Banks   Sound a lot like the great depression with runs on banks  Get ready for new runs on banks… … That’s what happened to hundreds of banks in the Great Depression.  Much of the Great Depression‘s economic damage was caused directly by bank runs.   I know one thing if I had any money in the bank I would have gotten it out in 2007 before the crash we saw the signs my family and friends on facebook can tell you that!  Oh wait I have not had money in the bank for years.  Its just one big vicious cycle that the Banksters keep playing generation after generation its a world wide  scam and if Jesus Christ was around today he would pick up the whip and go after this den of thief’s the same way kicking them out of his temple our world.

When even JPM says to panic, it may be time to panic. And then we ask why is all of this happening right now, why is even JPMorgan advocating a risk-off posture, and then we recall that every single year in late March, early April Europe comes back front and center with a bang, just as we forecast in “It’s Deja Vu, All Over Again: This Time Is… Completely The Same” and then everything becomes very clear.

Published on Mar 18, 2013

On the Monday, March 18 edition of the Alex Jones Show, Alex breaks down the collusion between the EU and IMF in confiscating individuals’ private wealth to ultimately seize control of economies, paving the way for years of dependency on financial dictatorship. On today’s show, Alex invites economic trend forecaster and publisher of the Trends Journal Gerald Celente to discuss the looting of Cypriot bank accounts, and what the future holds for Italy, which may be the next nation to be similarly plundered. We’ll also cover other major headlines and take your calls.


From Kathimerini:

The Cypriot cabinet has declared Tuesday a bank holiday, for fear of capital flight, and this may even be stretched to Wednesday, as depositors are certain to withdraw huge sums from the Cypriot banks after the haircut imposed.

Nicosia postponed from Sunday to Monday the tabling in Parliament of the bill including the measures for the Cypriot bailout – including a bank account haircut and a tax hike on interest and corporate earnings – but the European Central Bank insists on a rapid voting because there are already signs a domino effect will follow across European lenders and markets from Monday.

There is genuine fear of market unrest on Monday morning when stocks may crumble in the eurozone and bank accounts in other southern European bank may suffer.

Skai radio reported on Sunday that the Bank of Greece has sent between 4 and 5 billion euros to Cyprus in order to help Cypriot banks respond to cash requirements by their clients.

So, if the official name of the March 18 holiday was “Green Monday“, will the March 19th ad hoc holiday be called “Red Tuesday“? Inquiring minds want to know.

The price of gold remained approximately in Timeline of U.S. Gold 2007, The yearly average price of gold was $695, with a high of $833 per ounce. and in 2007 the Dow opened the year at 12,459.54 Understand why it crashed by following the timeline of events in 2008 and now today the news is say how strong the Stock Market is doing then why if the Market is on such a bull run at Dow Jones Industrial Average 2 Minute Dow Jones Indices: .DJI – Mar 18 4:35pm ET  Closed at 14452.06 today and the price of Gold is at 1594.00 This is my point if the stock market was on such a bull run why is Gold at still near record highs becase the smart people know that the Federal Reserve System is pumping up the markets by buying American Bonds and T bills Treasury Bills.  Money market investments backed by the U.S. government. Learn more about treasury bills at HowStuffWorks.

Gold Bullion 1,594.00 1,618.00 Upward change 14.10

Even Former US Treasury Official – US Financial System set to Collapse Dr. Paul Craig Roberts – Economist, Co-Founder of Reaganomics & Acclaimed Author Former US Treasury Official  Dr. Paul Craig Roberts  – US Financial System To Collapse

This conspiracy by a group of international elites controls and manipulates governments, industry, and media organizations worldwide. The primary tool they use to dominate nations is the system of central banking. They have a grip on the world economy, deliberately causing inflation and depressions at will. Operatives working for the New World Order placed in high positions in government and industry. The people behind the New World Order are international bankers, in particular the owners of the private banks in the Federal Reserve System and other central banks, and members of the Council on Foreign Relations, Trilateral Commission and Bilderberg Group.[1] The New World Order  controls Multinational and global organizations such as the European Union, United Nations, World Bank, International Monetary Fund and the proposed North American Union. The term gained popularity following its use in the early 1990s by President George H. W. Bush when he referred to his “dream of a New World Order” in his speech to the United States Congress on September 11, 1990.

this section copied from

infowars.com

Four Truths About the U.S. Economy All Investors Should Know

March 18, 2013 in Economics

by

By for Profit Confidential

Four Truths About the U.S. Economy

Truth #1: At the beginning of 2008, there were 28.22 million people in the U.S. economy on food stamps. Fast-forward to 2012, and the number has increased to 46.60 million—an increase of more than 65%. (Source: United States Department of Agriculture, March 8, 2013.) The number of Americans now on food stamps represents almost 15% of the entire population in the U.S. economy right now.

Truth #2: The poverty rate in the U.S. economy also increased in the aftermath of the worst economic condition since the Great Depression. In 2007, the official U.S. poverty rate was 12.5%. By 2011, this rate increased to 15%. We have experienced a 20% flight in the number of Americans living in poverty. (Source: “Poverty and the Great Recession,” The Russell Sage Foundation and The Stanford Center on Poverty and Inequality, Stanford University website, October 2012, last accessed March 18, 2013.) As it stands today, about one in every seven Americans is technically poor.

Truth #3: Similarly, job prospects for Americans have declined since the beginning of the financial crisis. In January of 2008, there were 4.2 million job openings in the U.S. economy. As the U.S. Department of Labor reports, in January 2013, there were 3.6 million job openings. (Source: Federal Reserve Bank of St. Louis web site, last accessed March 15, 2013.) There are 12 million unemployed individuals in the U.S. economy, with a significant number being jobless for more than six months.

As the U.S. economy faces severe headwinds because of the financial crisis, cities across the U.S. are suffering as well. According to the 2012 census, one in every three counties in the U.S. economy is “dying off” due to weakening economic conditions and an aging population. (Source: Huffington Post, March 15, 2013.)

Truth #4: We have a long way to go before we see any real improvement in the U.S. economy. The only thing that has improved since the financial crisis is the stock market, courtesy of cheap interest rates and extensive paper money printing. Don’t get lured into believing that a rising stock market means economic growth. The stock market and the U.S. economy are moving in opposite directions. Many public companies listed on the key stock indices are already warning investors about troubles ahead, profitability issues.

Sure, the old adage is, “Don’t fight the Fed.” But the stock market utopia can only go on for so long before “regression to the mean” becomes a reality again.

Michael’s Personal Notes:

Looking at the long-term chart of gold bullion and the U.S. dollar, there is an interesting technical chart pattern developing that may help us predict the next move in the greenback and the yellow metal.

In the chart below, the red line represents the U.S. dollar index and the golden line represents gold bullion prices.

$USD US Dollar Index cash settle stock chart

Chart courtesy of http://www.StockCharts.com

Both the U.S. dollar and gold bullion are going through the formation of the technical chart pattern called the “symmetrical triangle.” This pattern occurs during a trend and is often the result of a consolidation in prices. The majority of instances when the symmetrical triangle pattern emerges eventually result in a continuation of the prior trend.

If you observe closely, the trading ranges in the dollar and gold bullion have been getting smaller since the beginning of 2011. While keeping with their respective trends, they appear to be consolidating. The U.S. dollar has declined, compared to other major currencies. Meanwhile, gold bullion prices have been trending higher—from below $300.00 an ounce to close to $1,600 an ounce.

As I have been harping on about in these pages, the demand for gold bullion is robust, to say the very least. Central banks are rushing toward gold, seeking safety—they have turned into net buyers of the yellow shiny metal. In the last quarter of 2012, they bought the most gold in almost 50 years.

In contrast, by buying gold bullion, central banks may be losing trust in the U.S. dollar. According to a report by the World Gold Council (WGC), in 2000, central banks held 62% of their assets (or reserves) in U.S. dollars. By 2012, that percentage of U.S. dollar holdings decreased to 54% of the reserves. (Source: Market Watch, March 13, 2013.)

It isn’t a hidden fact anymore: the Federal Reserve has been increasing the money supply, as its balance sheet has grown to more than $3.0 trillion and its paper money printing program continues at a rate of $85.0 billion a month. The more paper money the Fed prints, the more vulnerable the greenback becomes.

Time will be the better judge of where the greenback and gold bullion end up, but from the looks of the chart above, the U.S. dollar appears bearish and gold bullion’s future seems bright.

(Want to know what gold stocks are the best buy right now? In our just-released special report, Lombardi’s Second Quarter 2013 Gold Forecast Report, you’ll find our analysis of the U.S. money supply and its implications for gold; current gold supply and demand; central bank activity in the gold market; our specific price projections for gold bullion; our top-five senior gold stock picks; and our top-five junior gold stock picks, all complete with charts. Click here for ordering info.)

What He Said:

“Prepare for the worst economic period ahead that we have seen in years, my dear reader, as that is what I see coming. I’ve written over the past three years how, in the late 1920s, real estate prices fell first before the stock market and how I felt the same would happen this time. Home prices in the U.S. peaked in 2005 and started falling in 2006. The stock market is following suit here in 2008. Is a depression coming? No. How about a severe deflationary recession? Yes!” Michael Lombardi in Profit Confidential, January 21, 2008. Michael started talking about and predicting the economic catastrophe we began experiencing in 2008, long before anyone else.

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