Seen on the street in Kyiv.

Words of Advice:

"If Something Seems To Be Too Good To Be True, It's Best To Shoot It, Just In Case." -- Fiona Glenanne

“The Mob takes the Fifth. If you’re innocent, why are you taking the Fifth Amendment?” -- The TOFF *

"Foreign Relations Boil Down to Two Things: Talking With People or Killing Them." -- Unknown

“Speed is a poor substitute for accuracy.” -- Real, no-shit, fortune from a fortune cookie

"If you believe that you are talking to G-d, you can justify anything.” — my Dad

"Colt .45s; putting bad guys in the ground since 1873." -- Unknown

"Stay Strapped or Get Clapped." -- probably not Mr. Rogers

"The Dildo of Karma rarely comes lubed." -- Unknown

"Eck!" -- George the Cat

* "TOFF" = Treasonous Orange Fat Fuck, A/K/A Dolt-45,
A/K/A Commandante (or Cadet) Bone Spurs,
A/K/A El Caudillo de Mar-a-Lago, A/K/A the Asset., A/K/A P01135809

Wednesday, November 30, 2011

The Game is Rigged; Wall Street Edition

The New York Times recently investigated the ways the Securities and Exchange Commission (SEC) deals with companies who have violated anti-fraud laws. Very often, the settlement that follows contains a promise not to break the law again, which the Times noted is odd because the company, "after all, was merely promising not to do something that the law already forbids." Often the same corporations violate the law again -- and make the same promise again and again.

The Times found 51 cases over the past 15 years in which 19 Wall Street firms broke anti-fraud laws they had promised not to break. These firms include Goldman Sachs, Morgan Stanley, JPMorgan Chase and Bank of America. When faced with these multiple violations, the SEC simply reaches another settlement and extracts another promise, rather than bring a contempt charge in court.
"You caught us, here's some money, we don't admit to doing anything wrong and we promise never to do what we maintain we didn't do." That would seem to cover it. (The NYT story, in case you're a digital subscriber.)

If you rob a bank, the DoJ and the FBI will send you to jail for a decade or more. But if the banks rob you, they just pay a pissant fine (for them), admit no wrongdoing, nobody goes to jail and it's back to business as usual.

But one judge has had enough:
A federal judge angrily threw out Citigroup Inc's proposed $285 million settlement over the sale of toxic mortgage debt, excoriating the top U.S. market regulator over how it reaches corporate fraud settlements.

U.S. District Judge Jed Rakoff in Manhattan said that in agreeing to the settlement, the U.S. Securities and Exchange Commission appeared uninterested in actually learning what Citigroup did wrong. He also said the regulator erred by asking him to ignore the interests of the public.

"An application of judicial power that does not rest on facts is worse than mindless, it is inherently dangerous," Rakoff wrote in an opinion dated Monday.
That'd be like the prosecution going into court and asking the judge to sign off on a plea-bargain without ever telling the judge what the charges were. Six months in jail would be too much for parking on an expired meter and nowhere near enough for aggravated rape of a minor, but the way the SEC operates, that's just what has been going on.

The opinion of Judge Ratkoff is here. It runs fifteen double-spaced pages.

The trial is set for next summer. And then we'll learn what evil financial fuckery Citigroup pulled off to swindle the people investing with them.

2 comments:

montag said...

I wish I could be as certain about the trial. New York is a dangerous place. Hell, even the mayor has his own army for protection. Nobody cares if he breaks your rice bowl or mine, but when he can potentially derail one of the 1%'s Gravy Trains he will need protection.

Stewart Dean said...

See also another one of Matt Taibbi's incandescent screeds, titled Federal Judge Pimp-Slaps the SEC Over Citigroup Settlement (Matt is as nasty honest as our fearless chairman):

http://www.rollingstone.com/politics/blogs/taibblog/federal-judge-pimp-slaps-the-sec-over-citigroup-settlement-20111129