Somebody did something they shouldn’t have and a number of victims lost money because of it. As Sue started to bury herself in the evidence, she gradually came to see the massive scope of fraud associated with this particular complaint.
Washington DC, USA June 11, 2020 - /PressReleasePoint/ - As a journalist Humberto Sanchez have been covering news from the Securities and Exchange Commission for over a decade. Humberto knew about Sue Curtin. She was one of a handful of SEC Senior Investigative Attorneys. But Humberto didn’t know Sue Curtin, the person, until this week. Sue has been working some of the most complex and challenging SEC, securities fraud, cases for over fifteen years. She was the “go to” attorney in her busy Boston office.
In late 2015, Sue was given what the SEC believed was a credible whistleblower case. At the time, she had no idea how this case was going to change her life. Initially, the case looked like most typical security fraud cases. Somebody did something they shouldn’t have and a number of victims lost money because of it. As Sue started to bury herself in the evidence, she gradually came to see the massive scope of fraud associated with this particular complaint. As an experienced investigator and trial attorney she had learned to keep her thoughts to herself. This time she couldn’t help but share with the whistleblower how stunned and concerned she was looking at the documents she was provided.
This case involved Puerto Rico municipal bonds. Not just a handful of bonds, but seventy billion- dollars in municipal bonds. The complainant provided indisputable evidence that the municipal agencies were bankrupt long before they were able to buy good credit ratings from Moody’s, Fitch and S&P. The three credit rating agencies knew the municipal agencies to be bankrupt, but for the right fee would issue good credit ratings anyway. The banks knew them to be bankrupt, but for the right fee they would sell the worthless bonds to the general public.
Sue Curtin was provided with forensic audits showing that the municipal agencies inflated or falsified their earnings by claiming accounts receivable that didn’t really exist. The CPA who provided the financials for the municipal agencies admitted under oath that they were intentionally misleading. Municipal Executives testified under oath that the three rating agencies and major banks like Citibank, Wells Fargo Bank and B of A all admitted to them they knew the bonds were no good. Much like Bernie Madoff the Municipal Ratings Agencies and the Banks hoped they could refinance the debt long before the municipal agencies defaulted on the payments. They would make payments on the old debt with money from new, unsuspecting, bond buyers before anyone realized that the municipal agencies really had no money. The rating agencies and banks loved it. It forced the municipal agencies to refinance on a regular basis and pay them new credit rating fees and sales fees.
In fact, there was so much theft taking place that the CIA started to track money laundering activities in Puerto Rico. The municipal employees would wire the money to countries like Venezuela and when it was clean, it would be used to pay off Senior Politicians, DOJ officials and SEC officials so they would all look the other way. Over time the CIA and other intelligence agencies started to record the conversations between these municipal employees and found out which politicians and Department of Justice officials were getting paid. The CIA offered this intelligence to the FBI repeatily and were rebuffed every time.
As Sue Curtin’s Whistleblower started to write newspaper articles about this, his phone began to ring off the hook with disgruntled CIA and FBI field agents. It appears they have been dealing with this criminal racket for well over a decade and were sick of it. It was with their help that the whistleblower was able to piece together how this government run protection racket worked.
According to government insiders, all of the Wall Street related criminal complaints were routed to the Department of Justices, Southern District Office in New York. When the complaints were received and before they were investigated, they would be buried if Senior Senators received the political contributions they asked for. If the payments were not already made, the Southern District Office would contact Senior Senators they would then extort money from the criminal organization. Once received, the Senator would then have the Southern District office or the SEC drop the investigation.
Between 2006 and 2018 the Senators received over one hundred and twenty-five million dollars in payments from Wall Street firms that stole tens of billions of dollars from the American people. Not one of them were every prosecuted. Both Sue Curtin and her whistleblower filed numerous complaints with the FBI. They repeatily refused to take any action.
Sue Curtin’s whistleblower then mailed all the Senators detailed evidence of this seventy-billion-dollar securities fraud. He kept detail receipts for the Federal Express packages. The Senators all ignored him and continued to accept large political donations from these Wall Street firms and support legislation that would further protect them from prosecution. Out of frustration, the whistleblower then wrote a book, “Capitol Hills Criminal Underground” explaining in detail how this government run protection racket works. Who was getting paid and who was dismissing the cases? He sent a copy of the book to all one hundred Senators and their Chiefs of Staff. The Senators continued to accept large donations from these criminal enterprises and put increasing pressure on the DOJ and SEC to bury Sue Curtin’s case.
In the meantime, Sue Curtin was receiving direct pressure from the SEC Chairman, the SEC Commissionaires and Senior SEC Leadership to drop the case. Five months ago, out of options and unsure what to do, she took the case to the SEC Inspector General, Carl Hoecker. After fives months, it became clear to her that the IG was going to do anything. This past Sunday, Sue Curtin filed a formal on-line FBI criminal complaint detailing all of this. She has now secured legal counsel, as well. Sue worries about her family and wonders if she should hire guards to protect her suburban Boston home. In the meantime, this once promising women has been relegated to the status of an outsider by the SEC leadership and is only given busy work to fill her days.
Humberto is a freelance journalist based in Washington, D.C. He previously covered Senate leadership for Roll Call and the federal budget and appropriations process for National Journal. After beginning his career at States News Service, he worked in financial journalism covering the Securities and Exchange Commission for Dow Jones Newswires, where his byline appeared in the Wall Street Journal. He also spent time covering tax, transportation and infrastructure policy and financing for The Bond Buyer. A graduate of James Madison University, Humberto studied philosophy and enjoys telling stories that focus on the personalities that animate and humanize government, policy and politics at all levels.
About Humberto Sanchez
Humberto Sanchez is a freelance journalist based in Washington, D.C. He previously covered Senate leadership for Roll Call and the federal budget and appropriations process for National Journal. After beginning his career at States News Service, he worked in financial journalism covering the Securities and Exchange Commission for Dow Jones Newswires, where his byline appeared in the Wall Street Journal. Humberto Sanchez also spent time covering tax, transportation and infrastructure policy and financing for The Bond Buyer. A graduate of James Madison University, Humberto studied philosophy and enjoys telling stories that focus on the personalities that animate and humanize government, policy and politics at all levels.