Frightening Warning Issued on Brokerage Accounts
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By Mac Slavo (SHFTPlan.com | Original Link)
Former money manager Ann Barnhardt, who in November of 2011 made the decision to cease operations of her brokerage firm and return funds to her customers citing “systemic” problems within the entire financial industry, has issued a new warning about the stability of US banks and the safety of individual deposit accounts.
The warning, stemming from a recent federal appeals court ruling surrounding customer funds lost during the 2007 collapse of Chicago futures broker Sentinel, indicates that individuals who lose deposited funds because a financial institution improperly manages that money, even if those funds are supposed to be “segregated” from other operations of the firm, are essentially left with no recourse if the firm goes belly-up. According to the court, a misallocation of those customer funds, “is not, on its own, sufficient to rule as a matter of law that Sentinel acted ‘with actual intent to hinder, delay, or defraud’ its customers.”
The implications of the ruling, according to Barnhardt, will affect the monies of all private individuals who have seen their deposit accounts wiped out in the collapse of firms like John Corzine’s MF Global and put all deposit account holders in the country at risk should their bank be faced with a financial windstorm:
The NFA in collusion with the banksters, government and judiciary have achieved their goal. The entire concept of “customer segregated funds” is officially, completely, legally dead.
Guys, it is OVER. I know that many of you are still cowering in normalcy bias, unable to deal with reality, unable to face the world as it is, but you have GOT to snap out of it. The marketplace is DESTROYED. You CANNOT be in these markets. All legal protections are now officially gone.
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The federal appeals court ruled yesterday that not only does BNYM stay at the front of the line, but that using customer segregated funds as collateral is NOT a crime, and that co-mingling customer segregated funds with proprietary funds is NOT fraud.
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What this means is that even if Jon Corzine is somehow dragged into court by private citizens, because you know damn good and well that the Justice Department will never, ever touch him, Corzine now has a legal precedent, likely from a bribed or otherwise coerced Federal Appeals Court, explicitly stating that an FCM can use customer deposits to pay its debts, and that the customers themselves are subjugated and have basically no legal right to their own monies, no matter what the law says, or what legal assurances, claims or guarantees are made to that customer about their funds held with an FCM or any other brokerage or depository institution. The “secured” party at the front of the line will always be the mega-bank who made the fraudulent loan using the stolen customer funds as collateral.
In other words, all customer funds in the United States are now the legal property of JP Morgan, Goldman Sachs, BNYM, or whichever megabank is the counterparty on the loans the FCM or depository institution takes out in order to fund its mega-levered proprietary in-house trading desks.
Source: Ann Barnhardt via Steve Quayle
The ruling is specifically designed to protect large financial institutions that have (purposefully) mismanaged customer funds and used the hard-earned life savings of Americans to gamble on equities, commodities and bond markets. If those firms happen to make the wrong bet, as MF Global, Sentinel and a handful of others have recently done, depositors who have placed funds with the banks under the belief that their bank account is securely protected from trading liabilities are now completely exposed and liable for the incompetence and negligence of those who engage in market trading.
This latest ruling combined with recent actions by the Federal Reserve and other government regulators suggests a massive fraud has taken place and the financial system itself is under extreme strain with the potential to make the financial collapse of 2007/2008 look like just a training exercise.
In recent days, for example, it’s come to light that the government has secretly called on the country’s five major banks to prepare themselves for collapse by creating stress recovery plans to be used in the event of worst case scenarios.
A few weeks ago, the Federal Reserve also implemented a new policy for money market funds held by financial institutions. Per the new policy, money market funds, which account for some $2.7 trillion in deposits across the United States, can be frozen in the event of an emergency or financial panic. This means that if and when the system does go into a tailspin, at exactly the time people will want to pull their money out of their bank account, they will be restricted from doing so.
These latest actions by government regulators, judges and financial institutions point to one thing: that we have an unprecedented financial collapse in the making. If such a financial crisis comes to pass it is clear that the policies and procedures now in place will transfer the legally owned deposits and money market savings of individual Americans into the hands of the banks at which those funds are kept.
Get Your Money Out.
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11:10 am
This is only part of the equation…..Our Imposter POTUS is wanting a "Shared Prosperity" program for his re-election. This is nothing more than the "Rallying Cry" for Socialist Communist, pure and simple. This Nation's rallying cry is, Remove this Socialist Loving Bas### on election day Nov. 6 !!
3:26 pm
The financial problem reported here did not begin with your favorite target of hate, so you can stop blaiming him. Where did you learn that this Democrat in the White House is a "Socialist Communist"? Umm ,let me guess . . .you watch Fox News all day and night and listen to Rush Limbaugh.
5:36 pm
It's very easy to deduce. Just watch everything he says and everything he does.
11:15 am
so does the same hold true for brokerage accounts like Schwab, Ameritrade, Optionsxpress, etc.? or are our funds safe in those type accounts?
12:14 pm
No surprise. Derivatives will blow up the economy long before debt, deficits, entitlements or anything else about which everyone is supposedly afraid
12:39 pm
We are freakin' doomed.
1:05 pm
Yup .. We're doomed .. but, THANK GOD, 'we' will probably RE-elect Barack so he can continue HIS idea of (?) … WHAT THE HELL HAS HE DONE??? How has 'his' leadership been workin' out fer ya lately??? (WAY TOO many just don't give a rat's behind .. just recognize A name and vote for him/her! Don't even member WHAT 'they' did or didn't do .. just recognized A name!!!) So sad!!!
1:24 pm
This is a deceptive article. It refers to "deposits" and "depository institutions" as being unsafe, but it never makes a distinction between brokerage money market and sweep accounts, which have no deposit insurance, and bank deposits, which are insured up to $250K (or more) by the Federal government.
1:55 pm
If you have money, where is it safe? I had some mice recently try to burrow into my mattress, so I know that's not safe either.
2:04 pm
If you no longer trust the banks and brokerage firms, where do you put your money? Under the mattress is not an option.
2:08 pm
Does no one think that the Supreme Court will overturn this decision? Of course, the Supreme Court is the one that said people and corps can give unlimited funds to PACs and other campaign organizations. I guess the whole judiciary are idiots.
By the way, if you want to make this a self fulfilling prophecy, create a stampede where every one wants their money or stock certificates delivered to them.
3:18 pm
Nothing is one hundred percent safe. Some people will always work at stealing. The best that can be done is to spread your assets across many investments. Some in brokerages, some in banks, some in real estate, some in business, some in precious metals (in hand), some in collectables, some in jewelry..you get the idea. So if you are unlucky enough to come across a thief in one of your allocations, you don't loss everything you have.
3:34 pm
If you enjoy paved roads in front of your house or free libraries and public education for your children or police and fire fighters when you need help, these services are due to the socialist system that has been in place for more than 150 years. Living under that system make you a Socialist, even though you don't know it. So if you like to call the President of the United States a Socialist, in a way, you are probably right, but, let's face it, so are you.
9:34 am
not everyone believes in "free" public schooling and other "socialist" services.
Roads – we pay a tax on fuel to pay for this. you have a choice not to pay this tax. How? ride a bike. walk. jog. Or pay less of the tax by getting an energy efficient vehicle. Roads do not apply to your argument. the more you use the service, the more you pay. that's called capitalism.
education – i'm not getting into the whole debate here, but suffice it to say, our education system is complete crap. it needs overhauled, and the government needs to get out of it.
public libaries – honestly, if the people feel they are still necessary, then the people should pay for it through donations or other voluntary collections. otherwise, they are a drain on the economy. costs of the buildings, staff, inventory, etc are too great in the digital world. i'm not saying they shouldn't exist, but they need to be subject to the same concept of adapting to the times. any business today using pen/paper to track their sales rather than a computer program would not be able to compete in today's market. same idea applies. cut costs and think outside the box. maybe the idea of a traditional library should fade into a newage library concept. what that is, i don't know, but my point is that everything should be subject to adaptation and taxpayers shouldn't be FORCED to foot the bill on services that are not in demand.
fire fighters/police – how is this "socialist"? yes, we do pay taxes that go to support these. however, you must also understand that getting help from either of them is not a "right". it is a service that we should pay for. fire fighters in particular, should operate like the ambulance services. (maybe they do, i really don't know). you pay if your house is on fire, or you pay a monthly/yearly service fee like insurance. police services are a tad more touchy. i think the usefulness of what they should be doing is not really what they are doing. we could spend hours and write books debating this subject as well, but again, my only point is it's a service you should pay for if you want the service.
we take for granted that these services are "provided for free", even though they are FAR from "free". so don't say that we are all socialist because this is the system we "live under". Obama isn't technically a socialist, but he certainly acts and speaks like he favors many aspects of socialism (distribute the wealth, etc).
3:10 pm
Wrong. We are only socialist in the fact that money (taxes) are taken from the wealthy (those who work and produce) and given to the poor (those who choose not to work and produce.) And too much of the money taken (taxes) are retained by the "workers" (government) who really produce nothing.
7:09 pm
You folks realize this is sourced from SHTFPLAN.com, right? Check out the other articles on their site and consider the source.
10:59 pm
The "abominator" to American values is BOTH a communist and a Muslim! As some Shia Muslim friends told me Islam is used by people to gain political power and to hold it! However they ALSO were somewhat surprized I was so anti-communist! They tryed to convince me that people in Russia lived as we do! I believe it is those that at onetime admited they were communists are now useing Islamics for the cause of communism!