BofA shortfall: did matrícula consular card figure in financial industry woes?

Is the American taxpayer a victim of financial terrorism, or just plain fraud?

Matricular Consular card [graphic from Colorado Alliance for Immigration Reform; graphic has been edited to scrub personal information.]Bank of America tops the headlines again with The Wall Street Journal reporting the bank faces a $34 billion shortfall in capital. BofA has received billions in bailout money, courtesy of the US taxpayer. What no one’s talking about are headlines from years past.

In 2005 Business Week reported the bank joined 404 other institutions accepting the matrícula consular card issued by the Mexican government. National Review online ran an article by James A. Cooley in 2004—he pointed to concerns the FBI expressed about potential for fraud by these cardholders. Once the cards became popular with Mexican residents living and working in the US without documentation, other countries followed suit. The report Cooley cites said El Salvador, Guatemala, Honduras, Nicaragua, Peru and Poland saw potential in a similar card system. “Argentina has decided to issue a consular identification card to approximately 180,000 Argentineans residing in California,” the FBI said, emphasizing, “the FBI's concerns to the committee regarding additional nations issuing these i.d. cards by noting that the tri-border region of South America (where Argentina, Paraguay, and Brazil intersect) was now recognized as a ‘hotbed of Islamic fundamentalism.’”

In 2003 Steve McCraw, Assistant Director of The FBI Office of Intelligence, told the House Judiciary Subcommittee on Immigration and Border Security, “They [Homeland Security Council] are also specifically examining counterfeit and fraud concerns with the Mexican consular identification card that would impact its acceptance for identification purposes."

In the article featured in Business Week, the buying power of 11,000,000 in the country without official papers was described as “companies…getting hooked on the buying power of 11,000,000 undocumented immigrants.” BW also said, “Largely via word of mouth in Hispanic neighborhoods, Wells Fargo has opened 525,000 matrícula accounts, which now represent 6% of the bank's total. It opens 800 new accounts a day across the 23 states in which it does business. Wells expanded the program to a Guatemalan matrícula in 2002 and an Argentinian version in 2003. Last October, Colombia launched a pilot matrícula program; El Salvador plans to offer a similar I.D. this fall.”

Mortgages, second mortgages and credit cards were easily obtainable. And BofA was one of the 404 institutions accepting the matrícula consular card.

One of the best breakdowns on the financial meltdown can be found at The Dillard Report. The analysis traces the Community Reinvestment Act signed into law in 1977 by America’s most inept president [in our opinion], Jimmy Carter, from inception to current effects. When the law was enacted, there was bias against minorities and there was a definite need to remedy that.

However as is often the case with government, the implementation of the law went far beyond reasonable boundaries, eventually making credit as common a commodity as a hamburger. By the end of the 1990s, President Bill Clinton and his Treasury Secretary Larry Summers had set historical records for deregulation. Both men publicly took credit for doing so. The CRA and eventual dismantling of reasonable standards for those obtaining credit created a perfect storm in the US, enabling fraud, overspending and lack of accountability by both lender and borrower. Summers now serves as President Barack Obama’s chief economic advisor. John Taplin at Talking Points Memo recently wrote, “Larry Summers was paid more than $5 Million by the hedge fund D.E. Shaw in the year before he joined the Obama Administration…”

I recently wrote about a report from the US Treasury documenting illegal tax refunds obtained by foreigners in the US. This article is one of many about fraud committed on the US taxpayer.

Congress and the president nurtured a scapegoat for the meltdown, fueling anger towards CEOs who received bonuses and pushing class warfare via new policies providing tax breaks to those making less than $250,000 a year but enacting a tax increase on those making more than that. The administration is also exploring a means to increase taxes and close loopholes for corporations conducting business in other countries.

I’ve often repeated we are not being told the truth about the financial meltdown that our children will be paying for long after we are dead. The current Congress and administration are setting record levels for federal spending, expanding a government that is incapable of responsible oversight. I believe America is a victim of financial terrorism, of outrageous levels of fraud and of smokescreen tactics to hide both.

The truth is the government played a key role in the financial meltdown. It may be years before we know the full extent of the truth because pomp media is a de facto arm of the current administration. Private oversight groups and publications like The Wall Street Journal are among the only entities doing responsible reporting about this. America already has a generous and transparent immigration policy. But Congress has provided a large loophole for undocumented foreigners to enter the country and, like the politicians who cater to them, feed at the public trough.