Goldman Sachs may not be the only firm in SEC cross hairs

TomCADem

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Thu Apr-22-10 08:29 PM
Original message

Goldman Sachs may not be the only firm in SEC cross hairs

Source: LA Times

The government's fraud lawsuit against Goldman, Sachs & Co. could portend cases against other financial giants that turned subprime mortgages into complex securities while also accelerating a surge in private litigation against Wall Street.

In announcing the Goldman case, Securities and Exchange Commission enforcement chief Robert Khuzami said the agency was looking into similar transactions at other firms. As the SEC struggles to shed its image as the snoozing securities cop that missed Bernard L. Madoff's vast Ponzi scheme, the agency is likely to bring additional cases, said Alan Bromberg, a securities law professor at Southern Methodist University.

"The SEC has become pretty aggressive, so it's a good bet," Bromberg said. Goldman, he said, was probably chosen as the first target because of its prominence. "It is the biggest and by most estimates the best firm on Wall Street."

Goldman Sachs is accused of failing to disclose that a hedge fund that helped it create complex securities had actually placed a bet that the investment would fail. Goldman has said it provided full disclosure to sophisticated investors who knew that some other knowledgeable party was betting against them.

Read more: http://www.latimes.com/business/la-fi-goldman-lawsuits-20100423,0,641640.story

I suspect that the media will being to circle the wagons and defend Goldman Sachs. Here is Jim Cramer complaining about the Goldman Sachs case. Expect Fox News to go full Leave-Goldman-Sachs-Alone in the days to come. Have you hugged an investment banker today?

http://www.thestreet.com/story/10728464/cramer-sec-case-against-goldman-is-weak-but-impetus-to-sell-is-strong.html

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Jheezus Chryst

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Thu Apr-22-10 09:43 PM
Response to Original message

1. Cramer is a corporate lapdog!

"I also think that there is simply an important issue
here that the government is leaving out. Goldman does not sell
washing machines. They do not sell vacuum cleaners. They sell
pieces of paper that are fully disclosed, and you can go long
or short them based on the info. There is no guarantee. There
never has been."

WTF is Cramer talking about?  If they don't make washing
machines or vacuum cleaners, or anything of value for that
matter, they are NOT working in the public interest and their
corporate charter should be revoked.  They are gambling with
the assets of working Americans, and they are insured by
working Americans when the gamble doesn't pay off.  Morally
bankrupt on both counts.  If you want an example of socialism
that DOESN'T work, just take a look at corporate America.  

Democratic socialism is great, so long as the working class is
the beneficiary of the established safety net.  The system has
deliberately been set up backwards by the wealthy elite.  No
wonder our government if f-ing broke!

Goldman sells bullshit.  They should be put out of business
along with the rest of the worthless money changers.  They do
NOTHING but screw over working people for a quick buck!

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Frank Booth

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Thu Apr-22-10 11:44 PM
Response to Original message

2. The wagons are already being circled.

This "objective" analysis from CNBC made big waves earlier today: "Main Investor in Goldman Deal May Have Caused Losses" http://www.cnbc.com/id/36710264

What is getting lost in all this mess is that Goldman Sachs was pushing CDOs on clueless investors while it was shorting/buying credit default swaps on the very same CDOs. Basically it was selling burning houses, claiming the houses were in good shape, knowing it would profit off the insurance proceeds.

Goldman Sachs committed fraud, plain and simple.

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Iliyah

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Fri Apr-23-10 12:01 AM
Response to Reply #2

3. Who

knew????

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