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Rep. Michael Grimm (R-NY) Inducted Into Sense on Cents Hall of Shame

Posted by Larry Doyle on May 24, 2011 7:17 AM |

Michael Grimm. Do you ever wonder how certain individuals in Washington might be so tone deaf as to miss the din and the roar of the American public screaming for increased transparency in our financial markets? Might these individuals be doing the bidding of the financial industry in return for the payoff of political campaign contributions?

How else could we explain why any individual in our nation today would promote a policy which would stifle the pursuit of badly needed transparency and real integrity in our financial markets?

We learned a few months back that Senator Jon Kyl (R-AZ), Senator Jeff Sessions (R-AL), and House Speaker John Boehner (R-OH) were central figures in blocking a badly needed and critical piece of legislation to protect whistleblowers. I wrote at that point, Now We Know Who Blocked The Whistleblower Protection Act to highlight that display of ignominy. Who now takes his place in the Sense on Cents Hall of Shame “Clown Wing” with the aformentioned charlatans? Enter stage right, U.S. Representative Michael Grimm (R-NY).

Do Grimm and others who would support a proposed piece of legislation to gut whistleblower protections believe that America neither needs nor wants real transparency and unbridled integrity throughout our markets and across our economic landscape? How does Grimm think the massive lack of transparency has impacted our country over the last decade?

Let’s send a message to Grimm and every other representative who might think about supporting his bill. Thanks to the National Whistleblower Center for drafting the message to Tell House Members to Stop Anti-Whistleblower Bill,

Republicans in the House of Representatives have proposed a radical anti-whistleblower bill (the Grimm bill) that, if passed, will completely undermine the ability of corporate whistleblowers to expose fraud and violations of securities laws.

Best described as the Madoff-Enabling Act, the proposed House Republican Amendments to the Securities Exchange Act will:

-Punish employees who disclose violations of the Acts directly to the Securities and Exchange Commission (SEC). It forces whistleblowers to inform corporate wrongdoers that they are violating the law before contacting law enforcement, giving the wrongdoers the opportunity to hide their misconduct from investors.

-Strip the Act of the current mandatory rewards provisions designed to encourage employees to risk their careers and expose large multi-million dollar, corporate fraud against shareholders.

-Allow corporations to use limitless shareholder funds to oppose whistleblowers, while imposing burdensome restrictions on the rights of corporate whistleblower employee to hire their own attorneys.

-Explicitly authorize corporations to establish “employment agreements” and “codes of conduct,” restricting the right of employees to notify investors or the SEC about potential fraud. Firing whistleblowers under these newly established corporate codes “shall not constitute retaliation.”

-Require the SEC to notify the company that it is being investigated, tipping off the wrongdoers.

This bill is perhaps the most anti-investor bill ever proposed.  It would destroy important reforms contained in the Sarbanes-Oxley Act of 2002 and the Dodd-Frank Act of 2010 and strip corporate employees of their ability to expose fraud.

Did the new House leadership forget about the frauds?  Have they forgotten there was a Wall Street meltdown?  Did they forget that whistleblowers were fired?  Did they forget that the SEC failed to do its job?

report by the National Coordinating Committee for MultiEmployer Plans (representing over 10 million workers, retirees, and their families) shows how widespread fraud is on Wall Street and the compelling need to protect employees who risk their careers blowing the whistle on fraud against shareholders.

The need for those campaign funds that come from Wall Street’s coffers must be mighty strong for Grimm and others who would support this legislation.

Is this the best that America gets? Why is it that the American media of all stripes lets this type of legislation fly under the radar? I know, ask a stupid question.

As a registered Independent and one who typically leans fairly hard to the right politically, I am ashamed and embarrassed that our nation has to suffer from the likes of those who would sacrifice principle for personal political gain. I realize all too well that politicians of all stripes suffer from that malady, but our nation as a whole is the biggest loser.

All we need to do to realize that is rewind the economic videotape of the last few years.

Larry Doyle

Thanks to the Sense on Cents supporter who brought this story to my attention.

Isn’t it time to subscribe to all my work via e-mail, an RSS feed, on Twitteror Facebook? Please get your friends and colleagues to do the same. Thanks!!

I have no affiliation or business interest with any entity referenced in this commentary. The opinions expressed are my own. I am a proponent of real transparency within our markets so that investor confidence and investor protection can be achieved.

  • Peter S.

    When I shared my concerns with management of the securities fraud being fostered at the firm, their unanticipated response was smashing me in the head with a brick.

  • Rob

    You’re going to have to expand the “Clown Wing” in the Hall of Shame before the year’s out.

  • Kathy

    Thank you for naming him. At least everyone on the web will know that Rep. Michael Grimm is against consumers, and essentially supports unfettered securities fraud.

  • vincent beckley

    Hi, I love your blog,
    I have been having major problems with B of A in obtaining a much needed mortgage modification for my home in a blighted Riverside County, CA.

    After a 2 1/2 year process I was told today by my MHA rep that I was being denied because of the $24,000 a month the bank reported as my income,.

    THis is NO WHERE near the $7,000 monthly income I showed on P & L Forms,
    Fed income tax and pay stubs, The bank also falsified the amount of money paid towards my mortgage from actual $4,600 to $3,200.

    WHO is responisble for monitoring the banks and stopping this type abuse?

    I have contacted the OCC, Treasury Dept, HUD, Attorney General, White House
    MY Senator and Congressman, all with no HELP

    Any Suggestions for a distressed homeowner

  • Peter Sivere

    From the Congressmans website. I do not know the man but funny how your “priorities” change once elected to office.

    It was during his tenure with the Fraud Squad that Michael started his undercover career becoming the first FBI Agent to successfully infiltrate Wall Street. Posing as a hedge fund manager during Operation Wooden Nickel, arguably one of the most successful White Collar undercover investigations in the history of the FBI, Michael obtained evidence against more than 50 individuals committing frauds spanning the spectrum from stock manipulation and currency scams to money laundering. After establishing a reputation as a reliable, “go-to” undercover agent, Michael was enlisted to investigate corrupt politicians in New Jersey, corrupt police officers in Florida, and various other cases. Michael has relentlessly fought corruption and served our country proudly.

  • Peter Sivere

    New Financial Services Committee members raise money from finance sector

    Two freshmen from the nation’s financial capital, New York, were appointed to the committee as well. Rep.-elect Michael Grimm, who won election from Staten Island, raised $222,350 from the finance sector. This amounted to 24 percent of the total money that he raised for his campaign, the largest percentage from the finance sector of all newly appointed members. Grimm defeated Democrat Michael McMahon, who also sat on the Financial Services Committee. Rep.-elect Nan Hayworth, hailing from upstate New York, raised $204,215 from the finance sector.

    The Financial Services Committee has always been a coveted spot for lawmakers facing tough reelection races in expensive districts. These lawmakers are in need of large campaign contributions and the finance sector is the biggest contributing industry of all. Since 1998 the finance sector has contributed nearly $2 billion to federal election campaigns.

  • LD: Recommended

    Thank you to the reader who brought the following to my attention from the POGO website,

    House Panel Passes Grimm Legislation Gutting Financial Whistleblower Programs

    Earlier this week, POGO and its allies wrote to the Subcommittee expressing our strong opposition to Rep. Grimm’s legislation. The letter was entered into the record at yesterday’s mark-up. We argued that H.R. 2483 is an “extreme approach that would silence would-be whistleblowers, endanger critical inside informants, undermine investigations, hamstring enforcement at the SEC and CFTC, and provide lawbreaking financial firms with an escape hatch from accountability.”

    Specifically, H.R. 2483 would require most whistleblowers to report problems internally to their employer before coming to the government in order to qualify for an award. It would require the SEC and CFTC to tip off companies under investigation before commencing an enforcement action based on a whistleblower tip. It would remove a provision that guaranteed a minimum award amount for tips leading to a successful enforcement action. And it would allow companies to force their employees into contractual agreements that would prevent them from reporting to the government.

    Rep. Grimm’s proposals have garnered support from the Chamber of Commerce and other industry groups. But whistleblowers, agency officials, and other experts are pushing back, arguing that H.R. 2483 would hamstring the SEC and CFTC’s enforcement efforts, shield law-breaking companies from accountability, and place whistleblowers in harm’s way.

    Harry Markopolos—who repeatedly tried to warn the SEC about Bernard Madoff’s Ponzi Scheme—wrote that H.R. 2483 “reads as if it were a wish list from those who once designed the Enron, Madoff, Global Crossing, Stanford, and WorldCom frauds.” And SEC Chairman Mary Schapiro pointed out that the agency’s rules already include provisions aimed at supporting internal compliance programs. She also reported that the program is “providing significant benefits to the SEC, both in terms of the high-quality tips of potential securities law violations we are receiving and the efficiencies it is creating in our enforcement of the securities laws.”

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