The FBI should Investigate Blackmailing of Enterprising Wealth Creators

Dr. Sankarshan Acharya
Founder, Pro-Prosperity.Com and Citizens for Development

May 11, 2017

Dear President Trump:

Why is the FBI not investigating the gargantuan blackmailing of enterprising wealth creators perpetrated by the so-called powerful lawmakers and allied Robber Barons? 

The 2008 takeover of two privately chartered companies, Fannie Mae and Freddie Mac, was orchestrated by Robber Barons and their political allies through blackmailing of enterprising wealth creators (EWC) with a threat that unless the private equity of Fannie and Freddie and $187 billion of additional taxpayer funds ('lent' by Treasury) were transferred to mega bank holding companies (via purchase of worthless MBS held by the MBHCs), the wealth and jobs of EWC would be decimated.  In 2008, the EWC lost 9 million good paying jobs and $13 trillion of their hard-earned wealth (these are underestimates), while the blackmailers became unseemly richer based on looted wealth. 

Why has the FBI not investigated such gargantuan blackmailing and loot of EWC that has unprecedentedly threatened the US by irreparably roiling the economy and indelibly soiling trust in the system of governance of USA? 

I see your volition to 'drain the swamp' the underlying motivation of the current deep administrative state (funded by the unconstitutionally looted wealth) to undo your presidency through perpetual investigation of your campaign's link with Russia.  Almost all 'bipartisan' lawmakers demanding investigation of your campaign's link with Russia are also the ones who have pursued for elimination of Fannie and Freddie and for continuance of the current system of robbery of EWC by the MBHCs. 

Why is the FBI not investigating the LINK between the private hedge funds managed by the MBHCs and lawmakers?  This LINK is the biggest source of crime and human rights abuse against humanity (propped by the EWC). I am still willing to be pilloried and crucified for seeking such FBI enquiry.  I had first requested to have the private trading book data of MBHCs when I was a financial economist at the Federal Reserve (1990-1995) where Fed officials challenged me to prove the existence of moral hazard (blackmailing) in banking and finance.  I had found since 1991 an optimal policy resolution, which is also unanimously agreeable, for an efficient resolution of moral hazard

Now even the Federal Reserve has agreed to my 1991 finding that moral hazard in banking and finance is the biggest threat facing the US economy.  It should be obvious that moral hazard (blackmailing) is the greatest threat to liberty.  Moral hazard (blackmailing) is unanimously disagreeable.  Efficient policy resolution of moral hazard is necessary for universally desired liberty.                    

Here is a blatant illustration of moral hazard facing EWC due to lawmakers that was obvious in the hearing at the Senate Banking Committee yesterday:

The Housing Economic Recovery Act (HERA) of 2008 created Federal Home Financing Authority (FHFA) as the conservator of Fannie and Freddie with a "mandate to conserve" assets of these two privately chartered companies. 

The Obama Administration and Acting FHFA Director Edward J. DeMarco squarely transgressed HERA's "mandate to conserve" by signing in August 2012 a policy (Net Worth Sweep) to transfer all profits of Fannie and Freddie to Treasury to eliminate Fannie and Freddie surreptitiously. 

Fannie and Freddie have returned about $80 billion more to Treasury than the $187 billion that the Treasury forced them to borrow in 2008 to purchase worthless toxic mortgage backed securities (backed by no loans) from mega bank holding companies.  MBHCs had to pay nearly $200 billion in penalty for mortgage fraud committed against Fannie and Freddie (amounting to robbery of Fannie and Freddie private equity by Robber Barons), thanks to the attorneys in Lower Manhattan. 

The current FHFA Director TRUTHFULLY testified before the Senate Banking Committee yesterday:

1. That transgression of the Congressional mandate of conserving Fannie and Freddie assets has increased risk to taxpayers. 

2.  The FHFA has authority to retain the profits of Fannie and Freddie as per the Congressional mandate to conserve Fannie-Freddie assets to reduce risk to taxpayers. 

Strangely, Acting FHFA Director DeMarco, the Senate Banking Committee and Obama Administration did not see the above TRUTH while signing the NWS in August 2012, just before Fannie and Freddie saw coming explosive growth in their profits. 

Even the current FHFA Director Watt did not emphasize till yesterday the obvious TRUTH of profound significance to US taxpayers and economy. 

Senator Corker seemed furious to counter FHFA Director's TRUTHFUL testimony, yesterday, as BASELESS.  

Senator Corker presented an INHERENTLY INCONSISTENT LOGIC that Fannie and Freddie with their profits vacuumed by Treasury's NWS impose no risk on taxpayers because of the $258 billion line of credit from Treasury that can be drawn anytime. 

The CORKER LOGIC is INHERENTLY INCONSISTENT because it amounts to enslaving of Senator Corker & Co by US Government (that Senator Corker would certainly not agree to): By the CORKER LOGIC, US government will impose a policy to take away all incomes from Corker & Co (to minimize risk to taxpayers) with a line of credit extended by government by which the bureaucrats will decide whether and when to give funds to Corker & Co for survival. 

The so-called powerful lawmakers have thus enslaved the enterprising wealth creators through laws that they do not want to apply to them.  Shouldn't the FBI agents prioritize investigation of these lawmakers' trades (like short selling of Fannie and Freddie stocks that was even publicly advocated by Senator Corker) in private hedge funds maintained secretly at MBHCs?  

With profound regards,

Dr. Sankarshan Acharya
Director, Academy of Unanimously Agreeable Philosophy and Governance