Will Banks “Cough Up Executives” in the Treasury Bid-Rigging Scandal?

[marmar]

Will Banks “Cough Up Executives” in the Treasury Bid-Rigging Scandal?
Posted on September 18, 2015 by Yves Smith


The Department of Justice may face an early test of its long-overdue policy change, that the government will seek to prosecute individuals, including executives, along with those of corporations. As Sally Yates, Deputy Attorney and author of the memo setting forth the new policy, put it, “We mean it when we say, ‘You have got to cough up the individuals.’”

As Bloomberg reported on Thursday, private plaintiffs have filed two suits alleging bid-rigging by the 22 primary dealers, adding pressure to an ongoing Department of Justice investigation. We’ve embedded the more recent filing, Cleveland Bakers and Teamsters Pension Fund v. Bank of Nova Scotia et al., at the end of this post. From the article:

The same analytical technique that uncovered cheating in currency markets and the Libor rates benchmark — resulting in about $20 billion of fines — suggests the dealers who control the U.S. Treasury market rigged bond auctions for years, according to a lawsuit….

The plaintiffs built their case against the 22 primary dealers who serve as the backbone of Treasury trading — including Goldman Sachs Group Inc., JPMorgan Chase & Co. and Morgan Stanley — using data from Rosa Abrantes-Metz, an adjunct associate professor at New York University who has provided expert testimony in rigging cases.

Bear in mind that investigations and litigation is underway, and no charges have yet been proven. However, in the last major Treasury bid-rigging scandal, in 1991, the Fed didn’t bother to wait for the Department of Justice to act. ................(more)

http://www.nakedcapitalism.com/2015/09/will-banks-cough-up-executives-in-the-treasury-bid-rigging-scandal.html

[truebluegreen]

1. Well, well--time to see if our new Attorney General

is any different from the previous one...or if she will be satisfied with the usual flea-bite fines and no admission of guilt.

[Faux pas]

2. Kickin'

[malaise]

3. Don't hold your breath

No

[gratuitous]

4. Short answer: No

It'll be "too complicated" to unravel it all, or there won't be an airtight case, or what the banks did was terrible, awful, immoral and greedy, but not illegal (since the banking regulations are largely written by the financial institutions). Nobody's going to jail, and any fine will be a pittance compared to what the banks ripped off the public for.