Biden calls for penalties on executives of failed banks
US government regulators should be able to levy fines against executives from collapsed banks, take back their compensation and bar them from continuing to work in the financial industry, Joe Biden said on Friday.
He called on Congress to pass legislation that would expand the powers of the Federal Deposit Insurance Corporation (FDIC) – the Washington agency that insures bank deposits – to hold the leaders of collapsed financial institutions like Silicon Valley and Signature banks accountable.
“No one is above the law – and strengthening accountability is an important deterrent to prevent mismanagement in the future. The law limits the administration’s authority to hold executives responsible. When banks fail due to mismanagement and excessive risk taking, it should be easier for regulators to claw back compensation from executives, to impose civil penalties, and to ban executives from working in the banking industry again,” the president said in a statement.
“Congress must act to impose tougher penalties for senior bank executives whose mismanagement contributed to their institutions failing.”
The president’s call comes after a week where the Biden administration acted forcefully to shore up the US financial system following the collapses of three banks in a matter of days. On Thursday, the government collaborated with some of the nation’s largest financial institutions to organize the $30bn rescue of First Republic, a medium-sized bank that was struggling to stay solvent.
Key events
Police preparing for Trump indictment as soon as next week: report
Law enforcement agencies are getting ready for the possibility that Donald Trump will be indicted as soon as next week by the Manhattan grand jury investigating his alleged hush money payment to adult film actor and director Stormy Daniels, NBC News reports.
The grand jury empaneled by Manhattan district attorney Alvin Bragg is hearing evidence over whether Trump violated campaign finance law by paying Daniels to keep quiet about having an affair with Trump. The payment happened while Trump was first running for president in 2016.
According to NBC News, law enforcement agencies are assessing security around a Manhattan courthouse in case Trump is charged and travels to New York to answer the allegations. The FBI, New York police department and Secret Service are among the agencies involved, NBC reports.
“Silence means surrender, so we will stand with Ukraine” – Irish leader
Joanna Walters
Ireland’s taoiseach, Leo Varadkar, has just finished addressing the St Patrick’s Day luncheon on Capitol Hill, attended by Joe Biden and hosted by the Republican House Speaker, Kevin McCarthy.
Varadkar congratulated McCarthy on his election to the position (following a tortured round of voting that held up the start of business of the 118th Congress in an unprecedented spectacle in January) and lauded him as an Irish American.
Varadkar also spoke of the importance of the Good Friday Agreement that brought an end to the decades of lethal conflict over the destiny of Northern Ireland, then turned his attention to the war in Ukraine.
He noted that Ireland is militarily neutral “but not politically neutral.”
“We stand with Ukraine, because silence means surrender, so we will stand with Ukraine for as long as it takes,” he said.
Varadkar noted that history shows that “appeasement ultimately fails” and he added that: “Last century, America led the free world against fascism and communism, and America leads the free world again, and we thank you for that.”
Here’s our full report from Rory Carroll and Martin Pengelly on Varadkar’s US visit so far.
Joanna Walters
Joe Biden is speaking on Capitol Hill now at a luncheon to celebrate St Patrick’s Day. He and vice president Kamala Harris have been hosting the Irish taoiseach Leo Varadkar and his partner Matthew Barrett in Washington today.
The taoiseach and the US president will take part in a ceremony at the White House later, where the Irish leader will present his counterpart with a bowl of fresh shamrocks, a symbol of Ireland.
Biden is wearing a green tie and a sprig of shamrocks in his breast pocket. He’s talking now about the Good Friday Agreement. He intends to visit the Republic of Ireland and Northern Ireland next month to mark the 25th anniversary of the historic peace deal.
We’ll bring you any significant remarks in due course.
Varadkar is speaking now.
Joanna Walters
The US Department of Justice is investigating the Chinese corporate owner of video platform TikTok on suspicion of spying on Americans, according to a new report published moments ago.
The case involves the possible surveillance of US citizens, including some journalists covering technology, the New York Times reports, citing anonymous sources familiar with the situation.
The Times reports further that:
The investigation, which began late last year, appears to be tied to the admission in December by the company, ByteDance, that its employees had inappropriately obtained the data of American TikTok users, including that of two reporters and a few of their associates.
The department’s criminal division, the F.B.I. and the U.S. attorney for the Eastern District of Virginia are investigating ByteDance, which is based in Beijing and has close ties with China’s government, according to a person with knowledge of the situation.
Confirmation of the investigation comes as the White House hardens its stance toward forcing the company to address national security concerns about TikTok. They include fears that China might be using the popular video service to gather data about or spy on Americans, undermine democratic institutions and foster internet addictions among young people.
The day so far
Joe Biden is calling on Congress to allow US government regulators to take back salaries from executives of collapsed banks, as well as ban them from working in finance and levy fines against them. While his allies in the Senate seem supportive of the proposal, it remains to be seen if Republicans will get over their usual wariness towards regulation and back the move, even after the shakiness the US financial system showed in recent weeks. And, of course, there’s Donald Trump news: he’s back on YouTube.
Here’s what else has happened today so far:
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Special prosecutor Jack Smith has subpoenaed a bunch of people who work at Mar-a-Lago as part of his investigation into Trump’s possession of classified material.
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Hunter Biden has filed a countersuit against a Delaware electronics shop owner who is suing him for defamation. A key issue in the complaint is whether the laptop and other devices Biden allegedly left at the shop were actually abandoned.
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Biden keeps delaying his announcement for re-election.
Sherrod Brown, the Democratic chair of the Senate banking committee, appears on board with Joe Biden’s call for harsher penalties on executives from collapsed banks.
“Working people and small businesses have been forced to pay the price for executives’ arrogance and recklessness too many times before. We need stronger rules to rein in risky behavior and catch incompetence,” Brown said in a statement.
“Our job on our committee is oversight, and we will be looking at all the ways we can protect working families’ money from risky bets that didn’t pay off in Silicon Valley or on Wall Street. That includes holding accountable the executives who ran this bank into the ground and the regulators tasked with overseeing them, and it includes working to reform our laws to better protect workers, small businesses, and taxpayers from corporate greed.”
Any such tightening of regulations would need approval from both the Senate and the House, where the GOP majority has shown far less interest in tighter banking regulations, even after this week’s financial instability. And some corners of the Democratic party remain wary of blaming deregulation for the recent bank collapses. As Politico reported on Tuesday, several Democratic senators who in 2018 supported legislation loosening banking regulations said they did not regret their votes. Perhaps that’s why the new measures Biden is proposing do not include a reinstatement of those rules.
The measures Biden call for appear intended at making sure executives personally suffer for running their banks into the ground.
In a fact sheet, the White House points to reports that the chief executive of Silicon Valley Bank sold more than $3mn in shares just before it collapsed, and calls for Congress to expand the Federal Deposit Insurance Corporation’s (FDIC) ability to take back such money.
The Biden administration also notes that the FDIC can currently only ban an executive from working in finance if they have engaged in “willful or continuing disregard for the safety and soundness” of their previous bank. “Congress should strengthen this tool by lowering the legal standard for imposing this prohibition when a bank is put into FDIC receivership. The President believes that if you’re responsible for the failure of one bank, you shouldn’t be able to just turn around and lead another,” the White House said.
Finally, the White House says Biden wants to broaden the FDIC’s ability to levy fines, particularly against “negligent executives of failed banks when their actions contribute to the failure of their firms.”
“The President is eager to work with Congress to strengthen accountability in these three areas – and others that Members of Congress identify. As the President has said, in his administration, no one is above the law,” the White House said.
Biden calls for penalties on executives of failed banks
US government regulators should be able to levy fines against executives from collapsed banks, take back their compensation and bar them from continuing to work in the financial industry, Joe Biden said on Friday.
He called on Congress to pass legislation that would expand the powers of the Federal Deposit Insurance Corporation (FDIC) – the Washington agency that insures bank deposits – to hold the leaders of collapsed financial institutions like Silicon Valley and Signature banks accountable.
“No one is above the law – and strengthening accountability is an important deterrent to prevent mismanagement in the future. The law limits the administration’s authority to hold executives responsible. When banks fail due to mismanagement and excessive risk taking, it should be easier for regulators to claw back compensation from executives, to impose civil penalties, and to ban executives from working in the banking industry again,” the president said in a statement.
“Congress must act to impose tougher penalties for senior bank executives whose mismanagement contributed to their institutions failing.”
The president’s call comes after a week where the Biden administration acted forcefully to shore up the US financial system following the collapses of three banks in a matter of days. On Thursday, the government collaborated with some of the nation’s largest financial institutions to organize the $30bn rescue of First Republic, a medium-sized bank that was struggling to stay solvent.
A more serious concern for Congress and the White House is TikTok, the wildly popular video-sharing app that many in Washington fear is in cahoots with the Chinese Communist Party. Here’s what we know about the growing feud between the US and China over the app:
TikTok is once again fending off claims that its Chinese parent company, ByteDance, would share user data from its popular video-sharing app with the Chinese government, or push propaganda and misinformation on its behalf.
China’s foreign ministry on Wednesday accused the US itself of spreading disinformation about TikTok’s potential security risks following a report in the Wall Street Journal that the committee on foreign investment in the US – part of the treasury department – was threatening a US ban on the app unless its Chinese owners divest their stake.
So are the data security risks real? And should users be worried that the TikTok app will be wiped off their phones?
Here’s what to know:
Big St Patrick’s Day vibes in Washington DC today.
The White House, currently occupied by proud Irish Catholic Joe Biden, dyed its fountain green:
And on the House floor, Republican Brian Fitzpatrick is proposing a bill to make today a federal holiday:
Headed to the House floor to introduce the St. Patrick’s Day Act, to make St. Patrick’s Day a federal holiday. ☘️☘️ pic.twitter.com/qDe2oo7Pye
— Rep. Brian Fitzpatrick 🇺🇸 (@RepBrianFitz) March 17, 2023
Speaking of presidents, when will Joe Biden announce whether he plans to run for re-election?
He is widely expected to go for a second term, including by first lady Jill Biden. Today, Politico reported that Biden’s announcement has been pushed back further:
Advisers had initially looked at an announcement around February’s State of the Union, or perhaps next month, timed to campaign finance reporting deadlines. But while April is still in play, members of the president’s inner circle have begun to discuss May or June for a decision.
Some of the last videos Donald Trump posted on his now-reinstated YouTube account feature him insisting the 2020 election was stolen from him.
But the Washington Post reports today that researchers hired by the former president to find evidence that deceased and double voters were the reason for his loss in crucial states turned up little to support those claims.
Here’s more from the Post’s report:
Researchers paid by Trump’s team had “high confidence” of only nine dead voters in Fulton County, defined as ballots that may have been cast by someone else in the name of a deceased person. They believed there was a “potential statewide exposure” of 23 such votes across the Peach State — or 4,977 fewer than the “minimum” Trump claimed.
In a separate failed bid to overturn the results in Nevada, Trump’s lawyers said in a court filing that 1,506 ballots were cast in the names of dead people and 42,284 voted twice. Trump lost the Silver State by about 33,000 votes.
The researchers paid by Trump’s team had “high confidence” that 12 ballots were cast in the names of deceased people in Clark County, Nev., and believed the “high end potential exposure” was 20 voters statewide — some 1,486 fewer than Trump’s lawyers said.
According to their research, the “low end potential exposure” of double voters was 45, while the “high end potential exposure” was 9,063. The judge tossed the Nevada case even as Trump continued to claim he won the state.
YouTube reinstates Trump’s account
YouTube said today it has lifted restrictions placed on Donald Trump’s channel after the January 6 insurrection:
1/ Starting today, the Donald J. Trump channel is no longer restricted and can upload new content. We carefully evaluated the continued risk of real-world violence, while balancing the chance for voters to hear equally from major national candidates in the run up to an election.
— YouTubeInsider (@YouTubeInsider) March 17, 2023
2/ This channel will continue to be subject to our policies, just like any other channel on YouTube.
— YouTubeInsider (@YouTubeInsider) March 17, 2023
The popular video sharing site cut off the former president’s ability to post new content after the attack on the Capitol – a restriction it lifted today. It’s the latest instance of tech firms that turned their back on Trump rethinking their policies as he once again runs for president.
Last year, Twitter’s new owner Elon Musk ordered the reactivation of Trump’s account on the platform, which was his defining mouthpiece while in office. Trump has not made any new posts on Twitter since then.
Hunter Biden has filed a countersuit against a Delaware computer repairman who played a key role in publicizing data from his laptop, ABC News reports.
The president’s son is responding to a defamation lawsuit filed by John Paul Mac Isaac, who has said he obtained the laptop after Biden abandoned it at his shop, and shared its contents with the FBI and Donald Trump’s allies. The lawsuit challenges whether Mac Isaac followed state law when determining the property was abandoned, among other issues. Here’s more from ABC’s story:
“[Hunter] Biden had more than a reasonable expectation of privacy that any data that he created or maintained … would not be accessed, copied, disseminated, or posted on the Internet for others to use against him or his family or for the public to view,” according to the countersuit.
Attorneys for Hunter Biden challenged Mac Isaac’s claim that the laptop and an external hard drive became his property when Hunter Biden failed to retrieve them within 90 days of leaving them at the repairman’s Wilmington, Delaware, shop for servicing, citing the fine print of a repair order allegedly signed by Hunter Biden at the time.
“Contrary to Mac Isaac’s Repair Authorization form, Delaware law provides that tangible personal property is deemed abandoned” when the rightful owner has failed to “assert or declare property rights to the property for a period of 1 year,” lawyers for Biden wrote in legal documents.
The counterclaim adds that “other obligations must then also be satisfied before obtaining lawful title, such as the court sending notice to the owner and the petitioner posting notice in five or more public places, and advertising the petition in a newspaper.”
Hunter Biden is seeking a jury trial and unspecified “compensatory damages” from Mac Isaac. A lawyer for Mac Isaac did not immediately respond to a request for comment.
Millions of Americans who rely on government food assistance just had their benefits cut, the Guardian’s Michael Sainato reports, thanks to the expiration of a special supplement passed during the Covid-19 pandemic:
Gina Melton is facing a dilemma. Like millions of other Americans, Melton and her family relied on food assistance benefits boosted by Congress to help them through the pandemic. Now that extra cash is gone.
The reduction has hit them hard. Three of her family members are disabled and one of her daughters works to take care of them through an agency. They had already relied on credit cards to pay for medical equipment that wasn’t covered by the federal health insurance schemes Medicare or Medicaid but have had to stop paying a couple of them in order to afford food.
“When you have to choose between feeding your family and paying a credit card bill, you have to choose food,” said Melton, 62.
The Guardian’s Hugo Lowell reports on anxiety in Donald Trump’s social media company over emergency loans accepted as the company ran out of cash. Here’s more:
Top executives at Donald Trump’s social media company started to become concerned last spring about $8m that they had accepted from opaque entities in two emergency loans when its auditors sought further details about the payments, according to documents, emails and sources familiar with the matter.
The payments had come at a critical time for Trump Media – which runs the Truth Social platform – because it was running out of cash after its planned merger with a blank check company known as DWAC that would have unlocked $1.3bn in capital stalled pending an SEC investigation.
But the financing, which came in the form of a $2m loan from an entity called Paxum Bank registered in Dominica in December 2021 and a $6m loan from a entity called ES Family Trust in February 2022, had been arranged in a hurry and Trump Media knew next to nothing about the emergency lenders.
Trump special prosecutor zeros in on Mar-a-Lago staff who knew about documents
According to CNN, special prosecutor Jack Smith’s latest subpoena volley indicates a determination to learn every detail about the movement of classified documents around Donald Trump’s Mar-a-Lago resort.
News that the former president was holding government secrets at his south Florida property became public last year when the FBI searched the resort and carted away boxes of material. Attorney general Merrick Garland appointed Smith to handle both the documents case and the inquiry into Trump’s efforts to overturn the 2020 election result – though the former has become clouded by the revelations that both Joe Biden and Mike Pence also had classified documents at their properties.
That doesn’t seem to be stopping Smith, who CNN reports is demanding testimony from anyone who could have seen anything regarding the documents at Mar-a-Lago. Here’s more from their report:
On Thursday, Trump’s communications aide Margo Martin, who worked in the White House and then moved with Trump to Florida, appeared before the grand jury in Washington, DC. One of special counsel Jack Smith’s senior-most prosecutors was involved in the interview.
Martin, who is among a small group of former White House advisers who have remained employed by Trump after he left office, declined to answer any questions when approached by a CNN reporter.
Smith has sought testimony from a range of people close to Trump – from his own attorneys who represent him in the matter to staffers who work on the grounds of Mar-a-Lago, including a housekeeper and restaurant servers, sources said.
The staffers are of interest to investigators because of what they may have seen or heard while on their daily duties around the estate, including whether they saw boxes or documents in Trump’s office suite or elsewhere.
“They’re casting an extremely wide net – anyone and everyone who might have seen something,” said one source familiar with the Justice Department’s efforts.
For instance, federal investigators have talked to a Mar-a-Lago staff member seen on security camera footage moving boxes from a storage room with Trump aide Walt Nauta, who has already spoken with investigators.
Many of the Mar-a-Lago staffers are being represented by counsel paid for by Trump entities, according to sources and federal elections records.
Special prosecutor aims subpoenas at Mar-a-Lago staff
Good morning, US politics blog readers. We learned a little bit more about special counsel Jack Smith’s investigation into Donald Trump’s possession of classified documents at Mar-a-Lago yesterday, when CNN reported that the prosecutor had sent subpoenas to a number of staffers at the south Florida resort – among them, restaurant servers and a housekeeper. Smith has been tasked with recommending whether to charge Trump over both his retention of classified materials and attempts to overturn the 2020 election, a decision that could upend the 2024 presidential race.
Here’s what else is happening today:
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Irish prime minister Leo Varadkar is in Washington DC, where he’s having breakfast with Kamala Harris, visiting the Capitol and attending a reception with Joe Biden at the White House.
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Trump hosts the Republican Party of Palm Beach County Lincoln Day Dinner at Mar-a-Lago this afternoon.
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Abortion advocates are awaiting a ruling from a Texas judge in a case that could lead to abortion medication being banned nationwide. It could come today, or next week.