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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
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

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
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 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 |
I AM THE TEA PARTY! Thousands Will See Just How 1984ish You Really Are Towards Free Thought, Speech!

about an hour ago via mobile ·
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”Finding common ground is quite a bit different then compromise. We want to find common ground with those on the other side. We just will not bend on our principles and ignore the constitution!”- I AM THE TEA PARTY!
This is how I after my comment was deleted from the thread that I replied back to I AM THE TEA PARTY! So I re-posted this information and said the following:
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WE THE PEOPLE of the Anti New World Order Party, in solidarity with the Campaign for Liberty Today, see it as pointless to carry on denying that a powerful secret society that calls itself the “New World Order” (better named the “Anglo-American Establishment”) is, by all the evidence, attempting to rule our country in defiance of the United States Constitution, the Bill of Rights (i.e. the first ten amendments to the Constitution), the Republic’s first principles and the common good, all of which it is government’s first and last duty to protect.
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