The New York Times reported yesterday that the criminal gang at Goldman Sachs is paying a $550 million “fine” to the Securities and Exchange Commission to “settle” their fraud case. If approved, the settlement would “represent only a small financial dent for Goldman, which reported $13.38 billion in profit last year.”
Meanwhile, Goldman Sach’s shares rose 5% in after-hours trading alone on the news adding about $3.5 billion in value to their market cap. Ah, life is good for the banksters at the top of the pyramid, especially when the media is on your side too. The New York Times piece went on to say:
Even so, the settlement is humbling for Goldman, whose elite reputation and lucrative banking business endured through the financial crisis, only to be battered by government investigations that shed light on potential conflicts of interest in its dealings.
‘This settlement is a stark lesson to Wall Street firms that no product is too complex, and no investor too sophisticated, to avoid a heavy price if a firm violates the fundamental principles of honest treatment and fair dealing,’ said Robert S. Khuzami, the commission’s director of enforcement.
The crime that Goldman Sachs is sweeping under the rug in this case is for a single mortgage security, Abacus 2007-AC1, that they pushed on clients while privately dumping it. The case had nothing to do with their deceptive lending practices, the bait and switch on the TARP bailout, or their front-running software that assures them that they can never lose on their stock trades.
The Times reported the details of the crime and subsequent “hush” deal as vaguely as any loyal mainstream media outlet would:
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The commission contended that Goldman misled investors, who were making a positive bet on housing, because Goldman did not disclose Mr. Paulson’s involvement in creating the deal. Mr. Paulson has not been accused of wrongdoing.
Though Goldman did not formally admit to the S.E.C.’s allegations, it agreed to a judicial order barring it from committing intentional fraud in the future under federal securities laws.
In addition, Goldman acknowledged that the marketing materials for Abacus ‘contained incomplete information’ and that it was ‘a mistake’ not to have disclosed Mr. Paulson’s role. As part of the agreement, the bank also said it ‘regrets that the marketing materials did not contain that disclosure.’
Then came the public statements to make us all feel warm and fuzzy that Goldman is now on the up-and-up with the American people. First, Goldman issued their PR statement, “We believe that this settlement is the right outcome for our firm, our shareholders and our clients.”
After the settlement announcement, wannabe tough guy Senator Carl Levin released the following in a written statement that is so ironic it could be a stand-up comedy routine:
‘Goldman played fast and loose in the Abacus deal, misled its clients, and got called on it today. A key factor in the settlement is that Goldman acknowledges wrongdoing, in addition to paying a fine and changing its practices . . . I hope the Goldman settlement together with the new financial reform law — which prohibits additional unethical practices and conflicts of interest — signal an end to the abusive practices that contributed to the 2008 financial crisis and the beginning of needed Wall Street reforms.’
The hand slapping followed by pats on the back for job well done is truly disgusting to witness. They really think the public so stupid to believe that Congress actually wrote the financial reform bill for the benefit of protecting the American people. What a joke — as Ron Paul clearly points out here: