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April 22nd, 2016 
Awake Goy
Susanne Posel ,Chief Editor Occupy Corporatism | Media Spokesperson, HEALTH MAX Brands
The National Credit Union Administration (NCUA) released a 500 page proposal in collaboration with the US Securities and Exchange Commission (SEC) and the Federal Deposit Insurance Corp. (FDIC) aimed at restricting large financial institution’s incentive-based compensation to prohibit executive from receiving massive payments for making overly risky gambles.
Back in 2011, regulators introduced a similar proposal based on the 2010 Dodd-Frank reform law because it calls for limitations on bonuses and other results-related compensation for top executives and other key employees in the banking industry.
The original draft did not include “significant risk-takers”; however, in the new draft, this term is defined as employees “who are not senior executive officers but who are in the position to put a … covered institution at risk of material financial loss.”
Rick Metsger, vice chairman of the NCUA, said: “Congress, and the American people, want senior executives at large financial institutions held accountable if their desire for personal enrichment leads to decision-making that results in material losses to the institution or our deposit insurance funds.”
Banks like Goldman Sachs and JPMorgan & Chase Co. rewarded executives after the crash in 2008 with bonuses “based on the volume of business they generated, regardless of whether the institution subsequently made or lost money on that business.”
This proposal will hopefully stop the encouragement of “inappropriate risks by providing excessive compensation or that could lead to material financial loss” for banks that have $50 billion or more in assets held.
This includes banks such as:
• Bank of America
• Wells Fargo
• Citigroup
• Morgan Stanley
• Bank of New York Mellon
• Capital One Financial
• HSBC
In 2015, 12 major banks made their living wills open to the public in response to US regulators pushing for more “convincing plans” for self-dismantling should their operations fail.
The purpose of living wills is a way “to give bankers and regulators a clearer understanding of a bank’s operations and its assets and liabilities [and] map out the steps the banks would take to distribute large losses among stakeholders.”
Collectively, the banks divulged that they have “stockpiled long-term debt” within holding companies (or the parent company that owns the bank) to make their portfolios appear to be “less complex”.
In other words, banks have placed their derivatives (or stockpiled long-term debt) within the main corporation that owns their subsidiaries. The only problem is that if the parent fails, so do its “children”.
The bank’s assets could be placed into receivership with the intention of being split up and auctioned off; however some corporation’s abuse receivership and bankruptcy to make investors and creditors think they are dead in the water only to pull out at the last minute and enjoy large primary debt write-offs. This is a sort of corporate version of playing possum.
This classic con tactic would provide the unique advantage of not having to go to the Senate and demand a taxpayer bailout. The banks could simply file for bankruptcy and exert social pressure via public outcry, protests and demands of the people that Congress consider another bailout.
In this scenario, the parent company gets saved and not the subsidiaries. This tactic is a reserve version of what happened after the crash in 2008.
Two years ago, these major banks were told to revise previously submitted living wills because their plans did not provide a “credible or clear path through bankruptcy that doesn’t require unrealistic assumptions and direct or indirect public support.”
All of this adds up to a bail-in, as predicted by economic analyst Jim Sinclair who said: “Bail-ins are coming to North America without any doubt, and will be remembered as the ‘Great Leveling,’ of the ‘great Flushing’ (of Lehman Brothers). Not only can it happen here, but it will happen here. It stands on legal grounds by legal precedent both in the U.S., Canada and the U.K.”
Sinclair pointed out: “Bail-ins do not require a crisis to occur and can surface one bank at a time, spread out over years. The major situation is deposits above insurance levels in banks too big to fail. Those deposits are directly in harm’s way.”
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