SEC Accuses Goldman Sachs of Civil Fraud. When Do We See Criminal Charges?
Somewhere, Matt Taibbi is laughing his butt off as the Vampire Squid goes down. Now when do we see the criminal charges - not just against Goldman Sachs, but the rest of the gang involved in crashing our economy for their own gain?
The Securities and Exchange Commission filed charges Friday against Goldman Sachs, one of the most successful but vilified banks on Wall Street, for misleading and defrauding investors in selling a financial product based on subprime mortgages.
In filing the civil suit against Goldman Sachs, the agency is targeting one of the banks that largely escaped the wreckage of the financial crisis and, with the help of various forms of government aid, emerged stronger.
The SEC's suit strikes at a practice that was one of the main causes of the financial crisis: the creation of poisonous investments derived from home loans made to borrowers who couldn't afford the houses they were buying.
The suit also drags into a legal maelstrom Paulson & Co., the firm of legendary hedge fund manager John Paulson, who made billions of dollars by betting against the housing market in the years before it went bust. He and his firm have not been accused of wrongdoing.
Goldman Sachs had no immediate comment. Paulson & Co. also had no immediate comment.
In this case, the SEC alleges that Goldman Sachs created and marketed a financial product known as a collateralized debt obligation, often referred to as a CDO, whose value was linked to that of home loans. The SEC says the bank failed to tell investors important information about the investment -- in particular that Paulson & Co. played a central role in helping Goldman assemble the CDO while the hedge fund at the same time placed bets that the CDO would lose value.
And from the American Prospect:
One note of caution: These are hard cases to prove. Even if Goldman Sachs officials knew how crappy these financial instruments were, they also got solid ratings from the bond-ratings agencies, giving Goldman a real out. If the SEC brought this case, they must have a high level of confidence, but now they need to execute what will undoubtedly be one of the most high-profile financial fraud cases since Enron.
Incidentally, the fact that hedge-funder John Paulson played a role in picking these securities helps confirm the argument that I made in my review of Michael Lewis' book The Big Short: Even the investors with the foresight to see the bubble and bet against it were acting as pernicious speculators who helped drive the bubble up and exacerbate its consequences, not as hero intellectuals tweaking the nasty big banks. These were symbiotic relationships that hurt regular Americans and the economy, make no mistake about it.
This news will only give more momentum to the Democratic financial-reform plan and, hopefully, more impetus toward strengthening the bill in any number of key areas where it could be improved.
criminal charges are for little people, not corporate welfare recipients.
but if you're gonna continue to let the ministry of not-so-funny-walks plaster that blinking bullshit on the page, why don't you just slam a giant
SABOTAGE
first of all, its Wal-Mart. That makes you whores, dudes. You're taking money for what, the convenience of infuriating your constitu-constitua-consti- your readers -- gee thanks.
Lemme guess, "we have no control over people paying to sabotage our page with blinking obnoxious Wal-Mart crapola..."
Bullshit. Refuse the ads. Refuse an agency that won't let you refuse. Refuse the bullshit mentality that says "the enemy is spending money worthlessly on our site"
that's ridiculous. It's childlike.
Eight year olds, dude.
your name's Lebowski, Lebowski... and your wife is Bunny
Goldman Sachs is Soros and Obama's friend. What is up.
I'd say a power struggle among the robber barons.
Goldman Sachs gave over $990,00.00 US Dollars to Obama Campaign in 2008.
Presidents come and go but the bureaucrats live on forever.
Either Obama is a lunatic and dumping on his friend, Goldman Sachs or the SEC doesn't give a hoot for Democrat corruption.
I say let those Global Criminal Goldman Sachs eat some dirt.
it's "democratic." I mean, for a minute there, I thought you were in denial of bankings best friends. You know, the republic party.
Happened before Obama came into office, Dude.....It has never been a secret of the funding of both parties has come from Wall Street. Look at all of the past and present employees of Treasury and you will see an unbroken line of Ex GS people at the highest levels. The bailout was engineered by none other than Henry Paulson, CEO and Chair of GS. Tarp gave GS 100% of money owed by AIG.
And it's only a "civil" violation?
"Looking forward not back" seems to be a more general theme. Well, that and "Don't tax the rich."
Corruption favors the wealthy.
It can be a "civil" fine.
Yeah !!
Return a few million of the BILLIONS you stole!!
That'll show ya!
When will government of the people, by the politicians, for the corporations perish from this Earth?
Not soon enough!
Who wouldn't pay a $5 million dollar fine to make $25 million?
If it's only going to be about money then how about that windfall profits tax the Dems used to talk about? We may not be able to prove every instance of wrongdoing that resulted in this mess, but we sure as heck know where the money went. It went up to the richest of the rich. Tax them - a lot.
Otherwise these fortunes will haunt us for the next 100 years.
Corruption favors the wealthy.
cabins, racehorses, furs, mansions, second homes, third homes,...7th homes, offshore tax free accounts, private jets, gold, jewels, art work. I volunteer to coordinate this effort.
Michael Milken (70s and 80s Junk Bond King) paid $1.1 Billion in fines and restitution, served less than 2 years of a 10 year sentence, was banned from the securities industry .. and as of 2007 was ranked 458th among the world's richest, worth over $2 Billion.
When will government of the people, by the politicians, for the corporations perish from this Earth?
Not soon enough!
But he was forced to be photographed without his toupee.
Corruption favors the wealthy.
Poor Mr Milken. Teh horror!
Sue all the criminal enterprises in court. Throw all the greedy, corrupt, Reslug assholes in prison and fine them severely.
Mitch McConnell has rounded up the necessary votes to block Democrats from bringing Wall Street reform to the Senate floor, a spokesman for the Senate Minority Leader said on Friday afternoon.
Senate Majority Leader Harry (D-Nev.) said on Thursday he planned to bring the bill to the floor next week where it would be debated and amendments added. McConnell has now persuaded 41 Republicans to vote against debating reform.
Senate Minority Leader Republican Mitch McConnell has agreed to stop any financial reform in exchange for campaign money from the Big Bankers as reported in the news outlets last week.
The GOP is finally admitting the fact that the GOP is really Pro Bail Outs for the Banking industry.
to do about it?" Thank you SCOTUS, for allowing them to publicly give us all the finger. Thank you so much! Right back at ya!
Paul Krugman: The Fire Next Time
When will government of the people, by the politicians, for the corporations perish from this Earth?
Not soon enough!
i say quit wit the pundits saying blah blah blah
end the fed
set this shit right
your name's Lebowski, Lebowski... and your wife is Bunny
When Do We See Criminal Charges?
When swine take flight.
"Ironic, isn't it Smithers? This anonymous clan of slack-jawed troglodytes has cost me the election, and yet if I were to have them killed, I would be the one to go to jail. That's democracy for you." --Mr. Burns
NEVER.
We'll see. It may or may not be too little too late. It's for damn sure about time.
When enough of the population demands it.
"Great minds discuss ideas; average minds discuss events; small minds discuss people." ~ Eleanor Roosevelt
I've got Vicks Vaporub in my eyes ...
And yet we lock up more people than anyone else.
Republicans are liars and simply cannot be trusted.
Our commie gubmint is trying to stifle free enterprise. Holy shit! The retards were RIGHT!
"Someday somebody related to some of these sufferers, these victims, these collaterally damaged souls, may try to kill you. And I have to tell you, I think you’ll have it coming." - Christopher Cooper
govt sachs screwing over their own clients in order for bigger clients of their's to make mad cash. talk about financial cannibalism.
Merrill Lynch did the same thing when the Clinton Bubble deflated.
Told every small investor that the market was the best place for their money, while at the same time moving large investors out of the market into safer investments.
When will government of the people, by the politicians, for the corporations perish from this Earth?
Not soon enough!
When do we see criminal charges ? How about a little patience and giving credit where credit is due ? It might all end up being for nothing and a joke , but do you think there would even be an investigation ( let alone a public accusation ) by the SEC under the Bush administration and the Republicans ? Wait and see , for now this is good news .
Insanity , it is what it is , there is no understanding it .
Criminals are gonna charge us now?
Do they have they credit card doo-hickeys for making copies?
Diabolus est Deus Inversus
. . . but they can imitate wild bulls on a rampage pretty well.
Corruption favors the wealthy.
They'll be fined $10 million dollars.
That sounds like real money until you consider that it's a fraction of one of their bonuses.
Exactly. Even if it's $100 million, heck, even if it's $1 billion it's nothing but hush money. Just the cost of doing bidness for GS, and a "see, we're doing something" moment for the government.
These bastids should be jailed. Each and every one of them.
... and the government can't do anything right.
Goldman&Sachs proved that.
They did great work, while it lasted. The government never did anything at that great of-a-scale. But let them step up now and see if they can put them away for a long while.
If you need funds to pay for essentials, you have a revenue problem
If you need funds to pay for frivolity, you have a spending problem
"Even if Goldman Sachs officials knew how crappy these financial instruments were, they also got solid ratings from the bond-ratings agencies, giving Goldman a real out."
These rating agencies are "funded" by the people that they are supposed to rate - isn't that putting the fox in charge of the hen-house! And since all of these agencies have been stocked with Corporate cronies how is it that people are supposed to believe in what they say! A reasonable person might think that after Enron and the Anderson accounting scandal things would have changed, but sadly, nothing has changed!
And now Sen. McConnell wants to hold this legislation hostage - why? Because frankly this legislation doesn't go far enough, bring back Glass-Steagall, separate the banking from investments! Have more transparency, and make sure that these "derivatives" are openly traded - so that everyone knows exactly what they are getting! No, the rethugnikans need to be made to stand on the floor of Congress and let the American people know exactly who they whore for CORPORATE AMERICA!!!
the SEC can just slap some fines on them old boys, and we will have established social justice! no longer will the top 1% pocket 40% of all the yearly income in this country! or whatever the latest measurement of injustice reports, because, they deserve it!
besides,
"Alpha children wear grey They work much harder than we do, because they're so frightfully clever. I'm really awfuly glad I'm a Beta, because I don't work so hard. And then we are much better than the Gammas and Deltas. Gammas are stupid. They all wear green, and Delta children wear khaki. Oh no, I don't want to play with Delta children. And Epsilons are still worse. They're too stupid to be able …"
True Justice would be to post the home addresses to ALL the capitalist pigs at Goldman Sachs and all the other pig firms that destroyed our economy and hand out free baseball bats to the millions of people who show up on their doorsteps.
Everyone needs to listen to this week's podcast - download it now, while it's free.
http://www.thisamericanlife.org/radio-archive...
"A hedge fund named Magnetar comes up with an elaborate plan to make money. It sponsors the creation of complicated and ultimately toxic financial securities... while at the same time betting against the very securities it helped create."
The exact same thing this case is about, except on a much larger scale.
For some reason, I can't be as sanguine as you are. For one thing, considering the SEC's rather dubious record of late (and I'm being generous here) with regard to investigating Wall Street corruption -- the most glaring example their repeated failure to conduct a competent investigation of Bernie Madoff -- I find it hard to feel confident that something will be done about Goldman Sachs even though I frankly think the firm deserves to go down. After all, they did exactly the same thing on behalf of their Greek governmental clients which Enron executives did on their own behalf -- no matter how you try to slice it, hiding debts from regulators means that they were cooking the books. For another thing, Goldman Sachs has so much influence and so many connections to powerful people that I have trouble believing any of the top executives will take any heat. Call me a cynic if you will (I won't contest the label) -- but something tells me that at best, a few underlings will be thrown to the wolves and end up taking the fall for their bosses in order to make the American people think that justice has been served when it really hasn't.
Never trust anyone who insists that patriotism requires you to blindfold yourself with the flag.
When ford pardoned nixon and has never been seen again in America!
I agree bluestocking but actually the SEC not going after Madoff was pretty much Bush's doing . Bush changed the rules ( this is verifiable ) so that investigators at the SEC were not authorized to investigate or go after anyone without permission from higher ups ... which were of course Bush cronies .SEC investigations and convictions went down to just about zero once Bush got into the White House ( also verifiable ) . For all practical purposes Bush / Cheney were heads of the mob . As for the SEC under this administration , it's a new ball game now , but I would be pleasantly surprised if penalties and punishment were anything but a slap on the wrist and pretty much a joke . We shall see .
Insanity , it is what it is , there is no understanding it .
If bush get appointed that this would happen. I didn't think they could hide it till he was leaving office so they fooled me there.
But it went almost like I thought it would.
Now we will pay and pay for letting this guy play president.
republicanism/conservatism is a mental illness!
the stock market is a ponzi scheme!~
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