There are two great financial mysteries in America: by Catherine Austin Fitts

[Joanne98]

Housing Bill, Part VIII

The Two Great Financial Mysteries of Our Time: Missing Money and Collateral Fraud

There are two great financial mysteries in America:

where is all the missing money and how do we get it back?
how big is the missing collateral black hole and how will it be resolved?
These two mysteries are essentially part of one mystery at the heart of the matter – who is in charge of - and what are - the real financial flows and assets of the central banking-warfare complex that increasingly governs the resources on our planet?

Since all financial frauds – from the manipulation of the precious metals markets, the engineering of the mortgage and housing bubble, ongoing naked short selling, Enron, the pump and dump of the internet and telecom stocks – come back to the same cast of characters, protecting our families and assets necessitates an integrated understanding of “the real deal” — who is really in charge and how the economy is really managed. Hence, it is useful to have a basic understanding of the missing money and missing collateral mysteries.

Let’s start with the first mystery, the missing money.


In fiscal 1999, the Department of Housing and Urban Development (HUD), under the leadership of Secretary Andrew Cuomo, reported $17 billion missing from its opening balance and $59 billion of undocumentable adjustments to close its books and refused to produce audited financial statements as required by law. In fiscal 2000, HUD refused to disclose the amount of its undocumentable transactions. For a sense of the magnitude of even the reported discrepancies, it means that the amount of undocumentable transactions occurring at HUD in 1999 was $1.13 billion a week, $227 million each work day and $28 million an hour.

The contractors that ran HUD’s auditing and payment systems also were large contractors at the Department of Defense (DOD) which reported $2.3 trillion of undocumentable transactions in fiscal 1999 and $1.1 trillion in fiscal 2000. DOD declined to report the number for fiscal 2001 and in all years subsequent to the legal requirement to do so, declined to produce audited financial statements as required by law, ensuring that the US Treasury could also not do so.

Indeed, the federal consolidated financial statements during this period were delivered with the following admissions by each Secretary of the Treasury:

Robert E. Rubin, 1997, Unauditable

“We believe that the publication of these audited statements is an important step in providing American citizens with more information about the operations of their government.”

Robert E. Rubin, 1998, Unauditable

“We believe that the publication of this financial report is an important step in providing the American public with useful information about their government’s assets, liabilities and operations.”

Lawrence H. Summers, 1999, Unauditable

“We are committed to producing and reporting financial information that meets the highest standards of integrity and to provide to the American people the accountability and professionalism they expect from their government.”

Paul H. O’Neill, 2000, Unauditable

“I am committed to producing and reporting financial information that meets the highest standards of integrity and to provide the American people the accountability and professionalism that they expect from the government.”

Paul H. O’Neill, 2001, Unauditable

“I believe that the American people deserve the highest standards of accountability and professionalism from their government, and I will not rest until we achieve them.”

John W. Snow, 2002, Unauditable

“I intend to continue the commitment to producing and reporting financial information that meets the highest standards of integrity and to provide the American people the accountability and professionalism that they expect from their government.”

From Kelly O’Meara, “Treasury Checks and Unbalances“, Insight Magazine, April 2004.

The U.S. constitution says that no payments can be made which are not provided for in an appropriations bill approved by the Congress. Specifically, Article 1, Clause 7 states: “No Money shall be drawn from the Treasury but in Consequence of Appropriations made by Law; and a regular Statement and Account of the Receipts and Expenditures of all public Money shall be published from time to time.”

It is quite significant that the government (and its accounting and payment contractors and bank depositories) engaged in an amount of illegal transactions in fiscal 1999 that was greater than the amount of total taxes it received in that year. It is even more significant that there has been little public discussion of this fact. This is no small violation of the Constitution in a country where millions go without health care and the infrastructure is in disrepair.

A handful of efforts to get to the bottom of what was going on met with little or no cooperation. Efforts by reporters and one brave Congresswoman, Cynthia McKinney, to identify the contractors responsible for managing the accounting and payments systems missing all this money were not successful. Investigative reporter Kelly O’Meara got David Walker, head of the General Accountability Office (GAO), the Congressional auditor, to commit during an interview that he would make this government contractor information public. However, GAO never did. One Tennessee congressman on the House Budget and Defense appropriations subcommittee confirmed to me that these billions were missing but that he was helpless to do anything about it. ( See Letter To Congressman Van Hilleary (R-Tenn.)

Things seemed to be coming to a head on September 10, 2001, when Donald Rumsfeld conceded in a press conference that DOD was missing trillions. However, that fact was not to attract much attention given 9-11 events the following day. Rather, the tragedy was used to justify the loss of financial records at the Pentagon (we are apparently to presume that the Pentagon is incapable of making or keeping back ups) and the inability of the Army to produce financial statements in 2001.

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