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FOX & Friends Vilifies Bank of America and Bank of New York But the Real Question Is - Why?

Reported by Marie Therese - April 5, 2006

Yesterday [4-4-06] the FOX & Friends trio presented a story about a "major" scandal involving Bank of America, drug kingpins, money laundering and clandestine funding of terrorism. However, by the end of the segment, I felt as though I'd left the real world and entered the Twilight Zone!

Brian Kilmeade. host, started off Tuesday's show at 6:01 AM EDT by saying: "Hey, we're gonna tell you about a story that, unfortunately, due to the breaking news during our show yesterday, we couldn't get in depth about. We are gonna do it today. A major terror - I guess you could say on some level bank bust - in terms of Al Qaeda using drug money to finance Al Qaeda and Hamas and Hezbollah. That's exactly what was happenin' in New York City. We're going into detail it in about ten minutes."

On Monday morning [4/3/06], when this story was first mentioned on FOX, I immediately ran to my copy of the Wall Street Journal and was truly surprised when what FOX called a "major story" about a New York bank was nowhere to be found. Consequently I was eager to see what FOX & Friends had uncovered.

At 6:15 AM Tuesday morning I tuned in. Here is my summary and partial transcript of what transpired between co-hosts Brian Kilmeade and Tiki Barber and guest Rachel Ehrenfeld.

TIKI BARBER: "The Bank of America is at the center of a terror money-laundering scandal."

BRIAN KILMEADE: "Yep. Rachel Ehrenfeld is the Director of the American Center for Democracy and author of Funding Evil. She knows everything there is to do [sic] about terror. Rachel, we were shocked to see a New York bank involved in this to the tune of billions of dollars. Can you tell me how all of this took place?"

On hearing Tiki Barber state that this scandal involved the Bank of America, I paused my VCR and read through the Tuesday edition of the Wall Street Journal, assuming that the story would be there. I came up empty again.

However, an online search turned up a short blurb dated February 17, 2006 which said:

"Bank of America Corp. is close to settling an investigation of money laundering from South America, according to Manhattan District Attorney Robert Morgenthau, Bloomberg News reported Friday. The bank may pay about $25 million to resolve the matter, according to a government investigator who asked not to be identified because the settlement amount isn't set. In December, Israel Discount Bank agreed to pay as much as $25 million to settle similar probes by Morgenthau and state and federal regulators over the same amount of money transfers. (Source: NYSSCPA.org)

I was perplexed. So, I restarted my VCR, expecting that this was some kind of FOX News exclusive.

Guess what? There was no "major" story, only an interview with Dr. Rachel Ehrenfeld*, author of a book that was published by Bonus Books on August 25, 2003 and reprinted in paperback in 2005.

Hosts Kilmeade and Barber presented her book as if the Bank of America (BofA) story was still new. For example, the first thing Kilmeade said to her was: "Rachel, we were shocked to see a New York bank involved in this to the tune of billions of dollars ... This is about three billion and they say it was fueled by drug money that would eventually be taken and given to terror groups."

Ehrenfeld responded: "Absolutely. This is drug money that came from the tri-border region in South America, this lawless region between Paraguay, Brazil and Argentina, well known. Apparently the Americans are not paying too much attention to it. Hezbollah, Al Qaeda, Hamas are very, very active there and other terrorist organizations. They sell drugs They sell mostly drugs, but they do everything else. Money laundering, etc. And the bank money transferred the money to the Middle East where the money is being used in order to fight Americans and Israel and everybody else."

(I could not find any examples of the government indicting or even implicating BofA in having knowledge that drug money was being laundered let alone being complicit in knowingly transferring that money to terrorists in the Middle East. Rather the case seems to be that BofA did not follow proper federal reporting guidelines and therefore passively assisted in the illegal transfer of funds by South American drug lords. The original case dates back to 2001.)

EHRENFELD: "But the banks actually are not complying with what they should comply, and check and know who their - the identity of their clients are".

KILMEADE: "So what is at stake here? So, if I walk into a bank and I have money - and I have almost nine billion - or a billion dollars in cash - these banks are saying I need that money so bad I don't really care where you got it from."

EHRENFELD: "Well, I don't know if they need the money so bad. They definitely want the money so bad and they just turn a blind eye."

KILMEADE: "What questions should they be asking? Where'd you get it from? They have to describe where they earned it?"

EHRENFELD: "Of course. if you go to the bank - try - go to the bank and try to deposit $10,000 in cash. See what happens. You'll need your I.D. They will have to know who you are, where you live ..."

KILMEADE: "To deposit?"

EHRENFELD: "Yes Just to deposit.."

BARBER: "How did the D. A. of New York - how did they come across this case with the Bank of America? How did they come - what led them to being able to uncover this?"

EHRENFELD: "It's always human intelligence that brings this kind of information to the public and again in this instance - I don't know the exact details but I - from what I understand, it's human intelligence that stemmed, actually, from a previous investigation into drug money laundering and terrorist financing as well."

BARBER: "Are there any other things that the D. A. can do other than impose this enormous fine that I believe they're gonna put on them - $25 million. Is there any other recourse that they have?"

EHRENFELD: "What is $25 million in fine to a bank that is ..."

BARBER: "That's what I meant. Is there anything else they can do?"

EHRENFELD: "They should give them bigger fines. They should close the banks to teach them a lesson. As long as it is not costing them enough, they will continue to do it."

(Now, here comes the bombshell, right out of left field!)

KILMEADE: "And this is the Bank of New York?"

EHRENFELD: "This is the Bank of New York."

(My jaw literally dropped open, I was so surprised! What happened to Bank of America?)

KILMEADE: "So as American citizens we should take our money out of this bank and we should not be customers to this bank. If they're helping to finance terrorists, they're helping to take down things like the World Trade Center."

EHRENFELD: "Well that's - that is something that the government should be encouraging and there should be laws and regulations against - more severe laws and regulations especially if it is a penalty - on banks that don't comply with the law. So, once banks know that this is something that they cannot do, because it will cost them dearly, they will stop doing it."

BARBER: "You know, terrorists are much more sophisticated now obviously. They use the internet."

KILMEADE: "Right."

BARBER: "They use our financial systems, really, to help finance everything that they're doing."

EHRENFELD: "They use - they use greed in order to corrupt us even further. That's what they are doing. It's not only the drugs that they are selling us and making money that they then can buy weapons to ..."

KILMEADE: "Kill us."

EHRENFELD: "... kill us.

BARBER: "Um-hmm."

EHRENFELD: "They are also using our system and our - the greed of our bankers - in order to transfer the money."

KILMEADE: "From the money to the flight schools to our university system."

EHRENFELD: "Absolutely."

KILMEADE: "Rachel Ehrenfeld. Thanks so much. With the American Center for Democracy and the author of Funding Evil.


When Kilmeade and Ehrenfeld confirmed that they had been talking about the Bank of New York and not the Bank of America, I quickly googled "Bank of New York" and "drugs." The only thing I could find was on a nutty site called Dark Conspiracy, which reprinted a 1999 article alleging the the Bank of New York was laundering money for the Russians!

However, I did stumble across a much more current item on Bloomberg.com:

March 30 (Bloomberg) -- JPMorgan Chase & Co., the No. 3 U.S. bank by market value, is in talks to buy Bank of New York Co.'s 300-branch retail banking arm, people familiar with the matter said.

Bank of New York may receive part of JPMorgan's back-office processing unit in exchange, according to the people, who requested anonymity because the deal hasn't yet been announced. The branches, mostly located in and around New York City, are themselves worth about $4 billion, said Prudential Equity Group Inc. analyst Mike Mayo.

JPMorgan Chief Executive Officer James Dimon has vowed to maintain his company's No. 1 ranking in the city, the wealthiest U.S. banking market, as rivals such as Bank of America Corp. expand. Bank of New York has lost deposits to bigger banks in the past three years, according to Mayo.

Kilmeade, an employee of FOX News Channel, literally advised FOX viewers that were also Bank of New York customers to remove their money from that institution. Similarly, a lot of Bank of America customers who saw this show might withdraw funds from that institution based on what they believed to be "news."

The only major financial institution that I've seen in the news lately is Citigroup. They are being investigated for insider trading in Australia, they paid $2 billion in fines for their involvement in the Enron debacle, they settled for $2.65 billion in a WorldCom class action lawsuit and just today (April 5, 2006) the Federal Reserve lifted a year-long ban on Citigroup that prevented them from becoming involved in any big mergers.

Prince Alwaleed bin Talal owns 4% of Citigroup shares and 4% of News Corporation, parent of FOX News Channel.

On Monday April 3, Reuters published the following:

A spokesman for Citigroup said the largest U.S. bank has been doing business in the Middle East for nearly 50 years, and is "actively exploring" new business opportunities in Saudi Arabia.

The spokesman also confirmed reports that billionaire investor Prince Alwaleed bin Talal, Citigroup's biggest individual shareholder, met with Citigroup Chief Executive Chuck Prince to explore the bank's reentry into Saudi Arabia.

Citigroup is a major competitor of the Bank of New York and Bank of America.

* By way of biographical background (since FOX News rarely gives any but the most cursory of introductions for its guests) Dr. Rachel Ehrenfeld received her Ph. D. in Criminology from the Hebrew University School of Law and recently spoke at the Intelligence Summit, a confab whose roster of speakers included FOX News Military Analyst Lt. Col. Bill Cowan (Cowan's company WWC3 also exhibited at the conference) and familiar FOX News guests Jed Babbin, Richard Miniter, Richard Perle and Dr. Walid Phares.

Dr. Ehrenfeld sits on The Intelligence Project's Advisory Board as do some other old friends from FOX News: Gen. Thomas McInerny, Gen Paul Vallely and Wayne Simmons. She also writes for David Horowitz's online magazine "FrontPage.com."

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