Wow, this is a surprising news story, given the recent effete and spineless political decision by the Justice Department to not criminally prosecute Goldman Sachs. NY AG Schneiderman's case against JP Morgan contains some of the very same facts that apply to Goldman, but that's another story.* The good news is that this is the first case the AG will prosecute under the combined state and federal task force Obama addressed. It alleges civil fraud, and as I said, the same kind of fraud Goldman engineered. Bear Sterns, now owned by JP Morgan, knowingly lied about the value of the junk mortgage-backed securities it sold. Even the contractor BS hired said it was junk. This is an encouraging sign that it's high time these corrupt Wall Street bankers will have to pay for the damage they wreaked on all of us. Go Schneiderman!
* Previously Goldman was sued by the SEC and fined $550 billion, but for the sale of one specific product only. The facts from that case, as well as the facts from Senator Levin's subcommittee, provided ample evidence to criminally prosecute Goldman.
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