web analytics

Interview with William Black

Written By: - Date published: 7:15 am, May 15th, 2016 - 30 comments
Categories: Economy - Tags:

Long time, regular commenter at The Standard, Travellerev, recently interviewed William Black. Travellev reports . . .
When plunder becomes a way of life for a group of men in a society, over the course of time they create for themselves a legal system that authorizes it and a moral code that glorifies it.” Frédéric Bastiat


About three weeks ago I was in the position to take part in an interview with one of my absolute global heroes. William Black, a renowned and successful financial fraud investigator in the USA and currently on the team of Bernie Sanders as his adviser in matters concerning Wall street and the international financial system, has been speaking out around the world against the current systemic fraud in our banking system and the lack of oversight and persecution of fraud!

William Black consented to a rare interview with a young local radio host after I put him on to William black and the host was generous enough to let me partake in the second half.

William Black has a long illustrious career as a financial investigator and as a banker hunter he has been incredibly successful with some 1000 convictions leading to jail time for bankers involved in financial fraud.

He also wrote a book which deserves the attention of everybody interested in the financial system. It is called: The Best Way to Rob a Bank Is To Own One

William Black and his investigative team developed a concept which is used to describe what happens when people in positions of power use the tools handed to them to corrupt the system they have control over. They termed it Control Fraud and this is what it means:

Control fraud occurs when a trusted person in a high position of responsibility in a company, corporation, or state subverts the organization and engages in extensive fraud for personal gain. The term Control fraud was coined by William K. Black to refer both to the acts of fraud and to the individuals who commit them. Wikipedia

William Black in several articles also wrote in detail how banks, most notably Merrill Lynch, used a beautiful model of fraud, starting as early 1990 (Before John Key started to work for them in ’95) all the way into the noughties when the bank in 2008 spectacularly collapsed under the weight of the derivatives it had on its books.

He describes the system as follows:

If you’re a lender there’s an easy recipe for maximizing fake accounting income. And it goes like this. You need four ingredients:

  1. grow like crazy

  2. by making really, really crappy loans but at a premium yield (yield just means ‘interest rate’)

  3. while employing extreme leverage, and

  4. while setting aside only the most trivial reserves or allowances for the inevitable losses this kind of behavior produces.

The trick is to do it quick and fast and get out before it collapses and it is only the top executives who get incredibly rich while the rest of the bank collapses.

So without further ado here is the interview. It starts at the second half of the two hour program but the first half is also available if you have the time. It is well worth listening to.

[youtube https://www.youtube.com/watch?v=BnATTosS-SY]




30 comments on “Interview with William Black ”

  1. save nz 1

    Great post. If American wants to ‘great great’ again they need to elect Bernie and get his fraud advisers in to root out corruption in their system. American corporations like banks and wall st and Kleptocrats are stealing from their own people and their own future.

    The West won the cold war because unlike USSR and others they put more effort into corruption controls and having a free media so ordinary people felt safe within the system. Unfortunately a fair and balanced system under extreme neoliberalism has ended.

  2. Nic the NZer 2

    Bill Black is well worth listening to.

    The similarities with Dick Smith collapse are relevant and striking (though its not clear fraud was involved there or not). Prior to listing DSE ran a strategy of selling down the inventory and not replacing it. This caused the company to report significant profits before listing on the share market. Sharemarket investors who brought in overpaid for shares and needed to recapitalise the inventory for the business to continue operating. If there was any fraud it was in the accounts put with the listing which didnt make it clear that the business carried little stock. At this time the listing company sold out before the problems became evident and locking in their profits before the share price collapsed. This kind of thing drives investors out of the Sharemarket no doubt.

  3. Nic the NZer, the same thing happened in Holland with the V&D chain and in England with the BHS chain. Both some 11.000 people lost their jobs.

    • dukeofurl 3.1

      Its going to be repeated here with the ‘media merger’, create a big candy floss which is sold to the public and collapses soon after.

      That was supposed to be Weldons job for Mediaworks too, but they put the cart ( someone who could do a stock exchange float) before the horse(growing the audience with successful programs).

      • dukeofurl 3.1.1

        Just thinking about TV companies like Mediaworks, they buy programs/series etc and they treated as ‘assets’ and normally once they are screened, they lose value very quickly, maybe a rerun a year later etc.

        But the books can be cooked , by not writing off programs that have been screened or more often than you would think programs bought but not screened.
        News shows are the worst sort of program, high cost and zero value the next day.
        But of course crap reality shows can be kept on the books for longer, until it comes share float time and the company can be ‘valued’ by its assets.

        You can see how the ‘accounting value’ can be a complete fake

        • Gristle

          From memory, most programmes were written down to 0 or at most 10% after the first play: even on a 3 play deal.

          The issue can be over output deals so you build up a library of material that you do not have either the intention of screening or physically don’t have airtime to put on before the license expires. And of course this material may represent 20% of an output deal. So you would be courting trouble if you put 20% value on this junk.

      • RedBaronCV 3.1.2

        Is there a strategy to stop this?
        Wouldn’t it be great to have a shareholder AGM that voted for a wage policy with strict upper level limits enabling the employment of more people at a reasonable wage, invite the staff to put up and vote for a couple of the board of directors – it would be great to invest in an ethical organization with a small steady return.

        • Colonial Viper

          Yes, we’re going to find a corporate shareholder meeting where the 1% minor shareholders alongside the 0.01% billion dollar hedge fund managers are going to suddenly start advocating to give away the value of their investment to the little people slaving away for them.

        • Nic the NZer

          In some places it used to be that the top execs and directors in certain industries based on trust (banking, accounting and legal) would have unlimited liability for their firms. This seemed to discourage a lot of this as the execs would keep an eye on how each was doing business.

          I think that should be brought back as a concept.

  4. Colonial Viper 4

    Awesome work Travellerev.

    Bill Black, an investigative veteran of the 1980s Savings and Loans scandal, makes it very clear how the subprime crisis was brought about and how the roots of the GFC were sown. And especially how the authorities have simply walked away from the problem.

    In the US Black makes a simple point: the financial system is regulated by authorities and law enforcement who do not believe in regulation or enforcement.

    Thanks again fo contributing this.

  5. Pat 5


  6. stunnedmullet 6

    Looking forward to more of your posts here Travellereve.

  7. adam 7

    Nice, interview and good job.

    What a nice guy.

  8. whateva next? 8

    Many thanks Travellerev, so good to hear someone with knowledge AND integrity explaining this stuff

  9. Penny Bright 9

    Well done The Standard, Ev, Vinny and Bill Black!

    Vinny Eastwood is getting some internationally significant guests on his show, and they’re being given more than a short ‘sound bite’.

    I’d like to give Ev full credit for her years of research on our ex-Wall Street banker Prime Minister John Key, and look forward to a LOT more people paying attention to what she is saying.

    And I’d also like to give full credit to Vinny Eastwood to providing an ongoing opportunity for those active on the issues to have a chance to explain WHY we are doing what we are doing.

    That’s what ‘freedom of expression’ is all about – the opportunity to put forward a view that some may agree to disagree with.

    But where we don’t choose to agree – let’s keep it civilised.

    Debate the ISSUES – or agree to disagree?

    Hope you are given more opportunities to post here Ev!


    Penny Bright
    2016 Auckland Mayoral candidate.

  10. Great interview, Travellerev. It’s not hard to make the connection from Libor to the City of London to the Crown. Key’s history in the banking industry shows him to be ideologically aligned with these financial predators.

    Interesting that Labour UK has recently has recently been conducting a witch-hunt over anti-semitism, with Londoner Ken Livingston very much in the limelight. Big money families like the Rothschilds having a fairly significant interest (if you’ll pardon the pun) in the operations of the City of London and in the use of the language of anti-semitism as a reaction to criticism of Zionism.

  11. fender 11

    Thank-you Travellerev for posting this. I found that highly educational and wish every voter in the country were made aware of how our PM fits into the puzzle.

    I’ve zero interest in reading the PM’s book, but it does seem odd that there’s no mention of derivatives in it. Surely he’s proud of his of his earlier “work”.

    • Fender,

      What is interesting is that the NZ Herald took 5 pages of the online version of an article which appeared in July 2008 of their website. That was the part of the “Unauthorized” biography article written among others by Eugene Bingham.
      The pages they took off were the pages in which they detailed his banking career.

      Maybe in a next post I can bring those pages back up because when I found the pages missing I went to the library and made a hard copy for future reference.

      It may be coincidence but they did so after I send them this article. An open letter to Eugene Bingham or would you have voted for John Key if you had known.

  12. Philj 12

    Well done and thankyou Travelrev. We have to tell the whole story to the public , somehow. Sigh. Keep up the good work.

      • Nic the NZer 12.1.1

        Think you should read through Bill Blacks article about 10 myths of neoclassical economics. It explains his position on deficits (and therefore govt debt) which was a question he didnt find time to answer during your interview properly.

Links to post

Recent Comments

Recent Posts

  • NZ announces a third P-3 deployment in support of UN sanctions
    The Government has deployed a Royal New Zealand Air Force P-3K2 Orion (P-3) maritime patrol aircraft to support the implementation of United Nations Security Council (UNSC) resolutions imposing sanctions against North Korea, announced Minister of Foreign Affairs Winston Peters and Minister of Defence Ron Mark. “New Zealand has long supported ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • Pacific trade and development agreement a reality
    Pacific regional trade and development agreement PACER Plus will enter into force in 60 days now that the required eight countries have ratified it. Trade and Export Growth Minister David Parker welcomed the announcement that the Cook Islands is the eighth nation to ratify this landmark agreement. “The agreement represents ...
    BeehiveBy beehive.govt.nz
    6 days ago
  • Securing a pipeline of teachers
    The Government is changing its approach to teacher recruitment as COVID-19 travel restrictions continue, by boosting a range of initiatives to get more Kiwis into teaching. “When we came into Government, we were faced with a teacher supply crisis,” Education Minister Chris Hipkins said. “Over the past three years, we ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Border exceptions for a small number of international students with visas
    The Government has established a new category that will allow 250 international PhD and postgraduate students to enter New Zealand and continue their studies, in the latest set of border exceptions. “The health, safety and wellbeing of people in New Zealand remains the Government’s top priority. Tight border restrictions remain ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • First COVID-19 vaccine purchase agreement signed
    The Government has signed an agreement to purchase 1.5 million COVID-19 vaccines – enough for 750,000 people – from Pfizer and BioNTech, subject to the vaccine successfully completing all clinical trials and passing regulatory approvals in New Zealand, say Research, Science and Innovation Minister Megan Woods and Health Minister Chris Hipkins. ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • International statement – End-to-end encryption and public safety
    We, the undersigned, support strong encryption, which plays a crucial role in protecting personal data, privacy, intellectual property, trade secrets and cyber security.  It also serves a vital purpose in repressive states to protect journalists, human rights defenders and other vulnerable people, as stated in the 2017 resolution of the ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Ministry of Defence Biodefence Assessment released
    The Ministry of Defence has today released a Defence Assessment examining Defence’s role across the spectrum of biological hazards and threats facing New Zealand. Biodefence: Preparing for a New Era of Biological Hazards and Threats looks at how the NZDF supports other agencies’ biodefence activities, and considers the context of ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • New Approaches to Economic Challenges: Confronting Planetary Emergencies: OECD 9 October 2020
    New Approaches to Economic Challenges: Confronting Planetary Emergencies: OECD 9 October 2020 Hon David Parker’s response following Thomas Piketty and Esther Duflo. Good morning, good afternoon, and good evening, wherever in the world you might be. I first acknowledge the excellent thought provoking speeches of Thomas Piketty and Esther ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Kaipara Moana restoration takes next step
    A Memorandum of Understanding has been signed today at Waihāua Marae between the Crown, local iwi and councils to protect, restore and enhance the mauri of Kaipara Moana in Northland. Environment Minister David Parker signed the document on behalf of the Crown along with representatives from Ngā Maunga Whakahī, Ngāti ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • New Zealand and Uruguay unite on reducing livestock production emissions
    Agriculture Minister Damien O’Connor and Uruguayan Minister of Livestock, Agriculture and Fisheries Carlos María Uriarte have welcomed the launch of a three-year project that will underpin sustainable livestock production in Uruguay, Argentina, and Costa Rica.  The project called ‘Innovation for pasture management’ is led by Uruguay’s National Institute of Agricultural ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • 3100 jobs created through marae upgrades
    Hundreds of marae throughout the country will be upgraded through investments from the Provincial Growth Fund’s refocused post COVID-19 funding to create jobs and put money into the pockets of local tradespeople and businesses, Regional Economic Development Minister Shane Jones and Māori Development Minister Nanaia Mahuta have announced. “A total ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Health volunteers recognised in annual awards
    Health Minister Chris Hipkins has announced 9 teams and 14 individuals are the recipients of this year’s Minister of Health Volunteer Awards.  “The health volunteer awards celebrate and recognise the thousands of dedicated health sector volunteers who give many hours of their time to help other New Zealanders,” Mr Hipkins ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Community COVID-19 Fund supports Pacific recovery
    The Minister for Pacific Peoples, Aupito William Sio says a total of 264 groups and individuals have successfully applied for the Pacific Aotearoa Community COVID-19 Recovery Fund, that will support Pacific communities drive their own COVID-19 recovery strategies, initiatives, and actions. “I am keen to see this Fund support Pacific ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Community benefits from Māori apprenticeships
    Up to 50 Māori apprentices in Wellington will receive paid training to build houses for their local communities, thanks to a $2.75 million investment from the Māori Trades and Training Fund, announced Employment Minister Willie Jackson today. “This funding will enable Ngāti Toa Rangatira Incorporated to provide its Ngā Kaimahi ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Training fund supports Māori jobseekers
    Rapidly growing sectors will benefit from a $990,000 Māori Trades and Training Fund investment which will see Wellington jobseekers supported into work, announced Employment Minister Willie Jackson today. “This funding will enable Sapphire Consultants Ltd. to help up to 45 Māori jobseekers into paid training initiatives over two years through ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Ruakura Inland Port development vital infrastructure for Waikato
    The Government is investing $40 million to develop an inland port at Ruakura which will become a freight super-hub and a future business, research and residential development for the Waikato, Urban Development and Transport Minister Phil Twyford, and Māori Development Minister Nanaia Mahuta announced today. The funding has been has ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Appointments made to Defence Expert Review Group
    Defence Minister Ron Mark announced today the establishment of an Expert Review Group to review a number of aspects of the New Zealand Defence Force’s (NZDF) structure, information management and record-keeping processes.  The Expert Review Group’s work arises out of the first recommendation from the Report of the Government’s Inquiry ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • No active community cases of COVID-19
    There are no active community cases of COVID-19 remaining in the country after the last people from the recent outbreak have recovered from the virus, Health Minister Chris Hipkins said today. “This is a big milestone. New Zealanders have once again through their collective actions squashed the virus. The systems ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Clean energy upgrade for more public buildings
    More public buildings will be supported by the Government to upgrade to run on clean energy, the Minister for Climate Change James Shaw announced today. Minister Shaw announced that Lincoln and Auckland universities will receive support through the Clean-Powered Public Service Fund to replace fossil fuel boilers. Southern, Taranaki, and ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Schools back donations scheme for the second year
    More schools have opted in to the donations scheme for 2021, compared to 2020 when the scheme was introduced. “The families of more than 447,000 students will be better off next year, with 94% of eligible schools and kura opting into the scheme,” Education Minister Chris Hipkins said. “This is ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Ruapehu cycle trails gets PGF boost
    The spectacular Mountains to Sea cycle trail in Ruapehu District will receive $4.6 million in funding from the Provincial Growth Fund for two additional trails, Regional Economic Development Minister Shane Jones announced today. “This is an exciting development for the local community, and one that will provide significant economic opportunities ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Update to air border order strengthens crew requirements
    Additional measures coming into effect on Monday will boost our defence against COVID-19 entering New Zealand through the air border, Health Minister Chris Hipkins said today. “As part of our precautionary approach and strategy of constant review, we’re tightening the requirements around international aircrew,” Chris Hipkins said. The COVID-19 Public ...
    BeehiveBy beehive.govt.nz
    3 weeks ago
  • A true picture of Māori business activity
    A better picture of the contribution Māori businesses make to the economy will be possible with changes to the way information is collected about companies and trading enterprises. Māori Development Minister Nanaia Mahuta and Small Business Minister Stuart Nash have announced a new option for Māori enterprises who are part ...
    BeehiveBy beehive.govt.nz
    3 weeks ago
  • PGF funding for Taranaki projects
    The South Taranaki museum, a New Plymouth distillery and a Pasifika building firm will benefit from a Government investment totalling more than $1 million, Regional Economic Development Minister Shane Jones says. The $1.05m in grants and loans from the Provincial Growth Fund (PGF) will help the recipients expand and create ...
    BeehiveBy beehive.govt.nz
    3 weeks ago
  • Fijian Language Week 2020 inspires courage and strength during COVID-19 pandemic
    The Minister for Pacific Peoples, Aupito William Sio says the theme for the 2020 Fijian Language Week reflects the strong belief by Fijians that their language and culture inspires courage and strength that is strongly needed in times of emergencies, or through a significant challenge like the global COVID-19 pandemic ...
    BeehiveBy beehive.govt.nz
    3 weeks ago
  • Trades training builds on iwi aspirations
    An investment of $2.025 million from the Māori Trades and Training Fund will support Māori to learn new skills while making a positive difference for their communities, announced Employment Minister Willie Jackson today. “K3 Development Limited Partnership will receive $2,025,000 for its Takitimu Tuanui apprenticeship programme, which will support the ...
    BeehiveBy beehive.govt.nz
    3 weeks ago