Investors Suing Banks? No Contest…Banks Win, use “global financial catastrophe defense”

[The Straight Story]

Investors Suing Banks? No Contest…Banks Win
Sunday, April 11, 2010

What do Oppenheimer & Co., Canadian Imperial Bank of Commerce, Fremont General Corp., Morgan Stanley, Merrill Lynch, State Street Corp. and Bank United Corp. all have in common? In addition to being financial institutions, they’ve each been sued for securities fraud and had the cases against them dismissed in recent months.

The Wall Street Journal reports that banks “are on a winning streak” in legal battles against investors who have filed lawsuits claiming executives broke the law while running their institutions. In many of these cases, banks have relied on some form of the “global financial catastrophe defense” that says it wasn’t the actions of the banks that ruined the financial sheet, but collapsing markets that were beyond the control of the banks and, thus, not considered “fraud.”

Since the end of 2007, approximately 40 securities-fraud cases have been dismissed in early stages, while only 20 have managed to move to the evidence-gathering phase, writes the WSJ.

http://www.allgov.com/Where_is_the_Money_Going/ViewNews/Investors_Suing_Banks__No_Contest__Banks_Win_100411

[glowing]

1. When are they ever going to be stopped? Jail should have happened for many a long time ago.

Its been a year and a half and nothing... no regulations... no orange jump suits... CEO's raking in higher profits, while the avg families who were already hurting under Bush are literally now in the streets.

[DJ13]

2. Civil court is the wrong venue

The SEC and the DoJ need to be investigating the fraud many institutions committed, and arresting top executives.