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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

Saturday, January 1, 2011

Conflict of Interest? What, Goldman Sachs? No!!!

Goldman Sachs acknowledges that it operates with and thrives on conflicts of interest. Former members of Goldman Sachs who find themselves in positions where conflict of interest is endemic have certainly come to take conflicts in stride. Take, for example, William Dudley, the president of the Federal Reserve Bank of New York: he worked for Goldman Sachs for 21 years (10 of those years as an economist). Does no one else see the implications here for vast conflicts of interest? Mr. Dudley is an "interested" man, one who invites all his Wall Street cronies to partake in the benefits of having one of its own in the Federal Reserve. Conflict of Interest is written all over those relationships and maybe that is why some writers view the relationship as totally ironic.

How can the Federal Reserve Bank of NY meet its mandate of supervising and regulating financial institutions when its president has worked for a bank whose interests should not coincide with the Federal Reserve Bank of NY because obviously Goldman Sachs and other banks cannot regulate themselves or the crisis would have been avoided. When Geithner was president of the NY Fed, he admitted he didn't regulate and now we have someone in charge who worked for a bank that dislikes regulation more than Geithner does. So Dudley meets with all the guys in the banks that brought about the financial meltdown and not one has to answer for his misdeeds! What kind of regulation is that?

Goldman Sachs, Citigroup Were on Dudley's Agenda in First Days on The Job
- Bloomberg

Meetings with top Goldman Sachs Group Inc. and Citigroup Inc. officials were on the schedule of Federal Reserve Bank of New York President William Dudley in his first days on the job in February 2009, the regional reserve bank chief’s daybook showed yesterday.

Dudley, a former partner and chief U.S. economist at Goldman, had an appointment to meet that bank’s chairman, Lloyd Blankfein, on Feb. 6, 2009, according to his schedule for 2009 and the first nine months of 2010. Four days earlier, Goldman was the topic of a planned meeting between Dudley and his staff.

Bloomberg News requested the records in a Nov. 29, 2010, Freedom of Information Act filing. New York Fed Senior Vice President Michael Held, in a letter to Bloomberg containing the documents, said the bank was complying “with the spirit of FOIA,” while maintaining it was not subject to the legislation. The New York Fed also published Dudley’s schedule on its website.

“In order to effectively perform his public duties, the New York Fed president must meet regularly with market participants, fellow regulators, the heads of institutions supervised by the Fed,” said New York Fed spokesman Jeffrey Smith. Dudley also meets with “members of advisory committees on small business and the regional economy, international officials and many others,” Smith said.

Dudley became the New York Fed’s 10th president and chief executive on Jan. 27, 2009. Prior to that, he was the bank’s head of markets during the financial crisis and one of the architects of the Fed’s emergency lending facilities.

Read the full article here


Anonymous said...

WILLIAM O’BRIEN, a former lawyer for Goldman Sachs, crosses the Hudson
River each day from New York to reach his Jersey City destination — a
shiny blue building opposite a Courtyard by Marriott.

Mr. O’Brien, 40, works there as chief executive of Direct Edge, the
young electronic stock exchange that is part of New Jersey’s
burgeoning financial ecosystem.

Direct Edge now trails the N.Y.S.E. and Nasdaq in size; it vies with
BATS for third place. Direct Edge is backed by a powerful roster of
financial players: Goldman Sachs, Knight Capital, Citadel Securities
and the International Securities Exchange, its largest shareholder.
JPMorgan also holds a stake. Direct Edge still occupies the same
building as its original founder, Knight Capital, in Jersey City.

They make a living by being the first to
react to events, dashing past slower investors — a category that
includes most investors — to take advantage of mispricing between
stocks, for example, or differences in prices quoted across exchanges.

“Markets are there for capital formation and long-term investment, not
for gaming,” he says.

Joyce said...

A good follow-up on the above article at:

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