SEC sued Goldman Sachs to break an impasse

[TomCADem]

Source: Washington Post

For months, Goldman Sachs and the Securities and Exchange Commission had been involved in secret talks over allegations that the Wall Street bank defrauded customers in selling them investments designed to fail.

Then, after a crucial meeting last month between lawyers for Goldman and the SEC, the agency came to a fork in the road. Even after SEC lawyers had told Goldman in writing they were prepared to file a federal suit, the firm gave no ground, declining to ask for a settlement, according to three people familiar with the case. The agency could prolong negotiations in hopes of reaching a deal Goldman would accept, as the SEC had often done in previous cases, or take the bank to court.

Endorsing the recommendation of investigators, the SEC's five-member commission voted 3 to 2 to proceed with the civil suit, taking a high-stakes gamble that pits Wall Street's top regulator against its most storied bank. The case, filed Friday, has provoked a counteroffensive from Goldman, which says it was blindsided by the suit. Goldman's defenders are suggesting that the suit may have been designed to help make the case for the Obama administration's push this month for legislation to overhaul financial regulation.

* * *
Chairman Mary Schapiro, who was appointed by President Obama, and the two Democrats on the commission voted to proceed; the two Republicans opposed the move. The commission periodically splits on decisions, with Republicans often more reluctant than Democrats to take companies to court.

Read more: http://www.washingtonpost.com/wp-dyn/content/article/2010/04/19/AR2010041905040.html

[earcandle]

1. If true, and Obama successively planned and executed a high stakes gamble, then

we have to admit they are finally doing what they are put
there to do.  Think, reason, engage and stand for the people. 
If they truly
planned this outcome, then I tip my hat to their successful
plotting to bring some accountability to this whole criminal
looting of our treasury.  And without assassinating anyone! 
or genociding them.  

good job.

one for the prez. 

hope its true. 

[TomCADem]

4. The Big Media Cover-Up Is That The Two Republican Appointees Voted Against The Suit

Even the Washington Post buries this fact toward the end of the story. Are the Republicans trying to cozy up to Wall Street by opposing financial reform that covers derivatives (McConnell), and by voting against filing suit against Goldman Sach for betting against their own investments?

What do you think?

[BootinUp]

2. This is the kind of news I would feel better not knowing

I am trying to be a happy person for a change. lol.

[napi21]

5. You should be happy. I don't know if it was preplanned, but

I do know that Goldman stalls on every accusation made against them, and it's worked for them for the last 8 years. I think they were assuming they would get a slap on the wrist this time too. I'm very glad with this outcome. Join me.

[indepat]

3. The two Republicans opposed the move and the forty-one Republicans will filibuster

financial reform legislation, all of which makes one wonder if every Republican is an obstructionist, if there is a single honest person among them, if there is even one who will do what's best for the country rather than subverting every effort of the majority party. History will properly label the lot of them. :shrug:

[napi21]

6. I don't think 41 will. Yea I know 41 signed that stupid letter, but that was posturing.

I don't believe there are that many Pubs who will go against their constituents wishes in an election year.

[TomCADem]

8. Not a problem, the media will convince the constituents to support the banks against the evil feds!

With Fox News, U.S. Chamber of Commerce, and Freedom Works funnelling millions into astro turf efforts, you will have the weak minded repeating Fox News talking points about having financial reform and regulation of derivatives being "Jammed down the throat of everyday Americans."

You know the drill:

1. Fox News pundit says talking point: "Financial reform is being jammed down our throat!"
2. Fox News viewer hears talking point.
3. Fox News viewer goes to Fox News covered rally and repeatedly yells talking point: "Financial reform is being jammed down our throats!"
4. Fox News reporter shows Fox News viewer spouting talking points as news: "Every day Americans are complaining about financial reform being jammed down their throats!"

[napi21]

9. They'll fail on this one. Wait and see. nt

[Cleobulus]

13. Such a campaign may backfire badly, for Fox News and the Republicans...

Right now public perception of banks and bankers is at an all time low, being perceived by the majority of the population as nothing more than thieves. Frankly I think the mask has been removed on the so called benefits of deregulation, and the banks obviously can't regulate themselves so I think most Americans WANT the reform Obama is pushing. This lawsuit could be just the beginning, and the Republicans and Fox News better be very careful about how they deal with this issue, or they may pay in the fall.

[TomCADem]

14. Fox News will tell the people what to think...Here's Fox and Friends Today...

All Fox News needs to do is: (1) Only play Republicans reading their Frank Lutz script that the bill is a big taypayer bailout and (2) only show those Democrats or liberals who are willing to complain about the bill in return for 15 seconds of fame. Viola! You have bi-partisan opposition to the bill! Heck, why not raise the spectre of death panels and forfeiture of assets. Just make shit up. Finally, ignore or interrupt any Democrat who dares to contradict these lies.

The average Fox viewer will be blissfully ignorant of the truth. The only reality they will see is that which is outlined in Frank Lutz's approved version of reality. Thus, such viewers can be your ground troops in the next demonstration on Washington D.C., as average Americans are deluded into thinking that regulation of Wall Street is attack on Freedom!

You think I kid, but here is Fox News with its up is down news coverage:

http://mediamatters.org/research/201004200014

Fox & Friends misrepresents financial reform bill

Fox & Friends and guest Glenn Beck falsely suggested that a $50 billion liquidation fund in Sen. Chris Dodd's financial regulation reform bill would "save" failing financial institutions and "keep them in business." In fact, the fund, which would be paid for by financial institutions, would be used to dismantle a failing firm and "is anything but a bailout," in the words of Republican Sen. Bob Corker.

BRIAN KILMEADE (co-host): And part of the reform is -- and it's over a thousand pages, I understand, as they try to work this out -- part of the reform --

BECK: The Constitution was four -- was four pages

KILMEADE: Right.

STEVE DOOCY (co-host): Way too simple, Glenn.

KILMEADE: And they had to keep dipping back for ink, and the paper was so brittle --

BECK: I know.

KILMEADE: But let me ask you, Glenn, just not to throw me off track - Steve does that professionally --

BECK: I'm sorry. ADD?

KILMEADE: They're going to be able to decide, OK, that company is too big, let's break it down. And we're going to use this $50 billion to finance it.

BECK: Are you out of your mind?

KILMEADE: And it's just the executive branch that will be able to do it as it exists right now.

BECK: Here's the way we break up big, huge companies. We let them fail. All of these big, huge companies that we're afraid of -- we just kept them in business, and we're still keeping them in business. They would have broken up because of failure, and the mom-and-pop banks, the small banks, the state banks, would have survived. Instead, our government propped up the big ones and are killing the small ones.

STEVE DOOCY (co-host): Do you think the guy down on the corner, if he goes belly-up, the government is going to step in and save him?

BECK: No.

DOOCY: Absolutely not.

* * *
PolitiFact.com: "he bill makes it clear that the money must be used to liquidate -- not keep alive -- failing firms." In an analysis of Republican claims that the legislation establishes a $50 billion fund for future bailouts, PolitiFact called the claim "false" and stated, "The legislative language is pretty clear that the money must be used to dissolve -- meaning completely shut down -- failing firms." PolitiFact further stated, "The fund cannot be used to keep faltering institutions alive."

[Pirate Smile]

7. Hey, guess what? There is a fricken difference between Democrats and Republicans even if you don't

think Democrats go far enough. There is a huge gulf actually and I hope people remember that in November.

[defendandprotect]

10. k-

[jbnow]

11. Makes me wonder what steps were not taken bt SEC over last decade

a republican appointee chairing it and a republican majority
On so many things that went wrong we hear that the SEC should have done this or that. I wonder if some of them wanted to, tried to...

[Rex]

12. The Repukes are always waiting to cover up corporate crimes

because a lot of their big donors will now go to jail or lose a lot of money. 'Too big to fail' now takes on a whole new meaning imo.