Recently The Daily Blaze did some homework about the 1992 US House Check Kiting Scheme. At the time it was a political earthquake, but today it is very hard to find information on it. We thought we would provide this little visit down memory lane as we dive into a notorious event that rocked the US House of Representatives in 1992.
- Perpetrators: The main guilty party behind the scheme was the US House Bank itself, a financial institution exclusive to members of the US House of Representatives. This wasn’t intentional but simply due to an incredible lack of oversight and accountability in the House Bank system.
- The Check Kiting Scheme: In essence, check kiting involves floating funds between multiple bank accounts to create artificial balances and avoid overdraft penalties. Dishonest representatives were writing checks for large sums of money without having sufficient funds in their accounts, exploiting the time delay between check clearing.
- Unraveling: As the number of overdrafts increased, suspicions arose, and media investigations exposed the scandal. In 1992, the House Bank was forced to shut down, and a 34-count ethics complaint was filed against 22 representatives involved.
- Fallout: The scandal shook public trust in the US government, as the very people entrusted with the nation’s affairs were revealed to be abusing their positions for personal gain.
- Impact: In the aftermath, public outrage led to the defeat of several incumbents in the 1992 elections, including some long-standing and influential politicians. The scandal brought a wave of new faces to Congress, promising reform and accountability.
Remember, it’s crucial to remain vigilant and demand transparency from our elected officials to ensure a government that truly serves the people. If you found this video informative, don’t forget to like, share, and subscribe. Stay curious and see you next time!
Some of the many that suffered consequences due to their involvement in the scheme: