I picked up an interesting woman from SFO yesterday who talked about how she worked for a highly successful company that spread rich investors' multimillion dollar deposits over a lot of different banks in order to claim the FDIC insurance at each. The limit at each bank is $100,000. I say interesting not because she was but because she was unguarded and even proud about it, although as I unraveled the story it became clear that this was another Bush era swindle and she knew it. In no time, she was commiserating with me about the criminality of the Reagan-Bush era and crying about her own run-in with usurious health insurance companies.

Her bosses were all big time ex-FDIC regulators, including the former head of the agency, who had launched the scheme and even patented it in 2002, right in the midst of the Bush crime wave. I discussed regulators who retired from government to enrich themselves in the private sector, based on their knowledge of loopholes, and asked why there was a cap on FDIC insurance to begin with. I suggested it was created to protect the middle class and not the rich at public expense. She said she hadn't thought of that and would have to do so...

The only reporting I've seen is the excellent Bloomberg story below.

It's amazing the things one learns in a cab.

http://www.bloomberg.com/apps/news?pid=20601103&sid=aBaYKQD_UPcE&refer=us
http://housingdoom.com/2008/09/25/loophole-from-hell-blowing-past-the-fdic-speed-limit-for-fun-profit/

Labels: Bush era crimes, FDIC, Reagan era crimes