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According to the Collins English Dictionary 10th Edition fraud can be defined as: "deceit, trickery, sharp practice, or breach of confidence, perpetrated for profit or to gain some unfair or dishonest advantage".[1] In the broadest sense, a fraud is an intentional deception made for personal gain or to damage another individual; the related adjective is fraudulent. The specific legal definition varies by legal jurisdiction. Fraud is a crime, and also a civil law violation. Defrauding people or entities of money or valuables is a common purpose of fraud, but there have also been fraudulent "discoveries", e.g. in science, to gain prestige rather than immediate monetary gain
*As defined in Wikipedia

Tuesday, April 20, 2010

Goldman Sachs: Married to the Mob

The Automatic Earth is one of my favorite sites and this post on Goldman is an example of why.

Ilargi: Haven’t read enough about Goldman Sachs lately?

Well yes, there’s a curious role of ACA Capital in the SEC-Goldman lawsuit, it had only a CCC rating, not AAA like Ambac or MBIA, but its CEO was married (partnered) to the Goldman general counsel (no, not trivial, a relationship like that has to be divulged to investors, but was not). Here’s thinking ACA might have been just a bit more pliable...

So where is Andrew Cuomo when you need him? Wait a minute, New York's Attorney General is running for governor, in daddy’s footsteps, isn't he? That probably answers my lingering question as to his silence so far in the SEC vs Goldman Sachs case. After all, it’s not like he needs more than the weekend to read up on it, the entire case as filed on Friday comprises a grand total of 22 pages. More on that last bit in .. a bit.

There's some curious things about that SEC case, like who’s actually charged with what. There's no Jonathan Egol, Fabrice Tourre’s partner at Goldman, no hedge funder John Paulson, no Goldman CEO Lloyd Blankfein. Instead, the only person the SEC names -far as I've seen- is Fabrice Tourre, who, at the time the Abacus deal involved played, was all of 28 years old.

That age thing keeps on itching me. It somehow points to the degree of involvement of the likes of Blankfein, Goldman president Gary Cohn and CFO David Viniar. These guys don’t let a mere kid play with billions of their capital without keeping a close watch. They were all down there on the trade floor for extended periods of time, figuring out what exactly transpired, as can be proven.

Moreover, the then (2006-7) 28-year old Tourre was claiming something that was the 180 degree opposite of what other traders at Goldman had a lot of the firms’ money invested in, namely the continued upward growth of the housing market. Tourre’s contrary claims were nothing short of revolutionary, certainly in the eyes of the older, and more bullish, traders. So it should not come as a surprise that the highest echelons of the firm spent a lot of time with Tourre and other traders. They would have been mad not to. That also means, however, that claiming they didn’t know what was going on is not believable. As Louise Story writes in the New York Times:


Read the rest here



Anonymous said...

How about joined at the hip with the SEC?

Has SEC COO And Former Goldman Employee Adam Storch Recused Himself From The Investigation?

Anonymous said...

cover-ups are illegal

Anonymous said...

Same ole song....

This should be posted in every newspaper blog section across the country.

Alleged Goldman Sachs fraud

April 19, 2010News > Money > Lang & O'Leary Exchange

Amanda Lang and Kevin O'Leary talk with Janet Tavakoli, president of Tavakoli Structured Finance, on the SEC's civil case against Goldman Sachs

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