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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, March 19, 2011

Goldman Sachs's Exuding Influence

Elizabeth Warren's resume contains ample evidence of her concerns for the welfare of the average consumer. So it is with great consternation that we read that she is being attacked by a former Goldman Sachs banker. We know Goldman Sachs only advocates on behalf of Goldman Sachs.

Elizabeth Warren was named by President Obama to oversee the development of a new Consumer Financial Protection Bureau, according to Wikipedia. Further, she also serves as Special Advisor to the Secretary of the Treasury on the CFPB which was established by the Dodd-Frank Bill. She chairs the Congressional Oversight panel that oversees, for example, TARP funds.

When Warren was asked where financial regulation reform should focus, she said:

To restore some basic sanity to the financial system, we need two central changes: fix broken consumer-credit markets and end guarantees for the big players that threaten our entire economic system. If we get those two key parts right, we can still dial the rest of the regulation up and down as needed. But if we don't get those two right, I think the game is over. I hate to sound alarmist, but that's how I feel about this. (from Wikipedia)

It seems self-evident why there is opposition to the CFPB but one wonders about the animosity which accompanies it.

Ex-Goldman Banker Behind WSJ 'Smear Campaign' Against Elizabeth Warren
by Zach Carter - The Huffington Post

WASHINGTON -- A Wall Street Journal editorial writer who has been closely involved with the paper's recent attacks on Elizabeth Warren is a former Goldman Sachs banker. The same editorial writer, Mary Kissel, is readying another piece critical of Warren and the new consumer agency, according to a source familiar with the coming article.

Like most major newspapers, the Journal does not disclose the authors of its editorials. Kissel recently appeared on the John Batchelor radio show as a representative of the Journal's editorial board to discuss Warren, and repeated the main arguments used in the editorials.

The editorials paint both Warren and the new Consumer Financial Protection Bureau as an immensely powerful, unaccountable organization. The nascent agency is assuming the consumer protection duties currently exercised by regulators at the Federal Reserve and the Office of the Comptroller of the Currency.

The author, Mary Kissel, worked for Goldman between 1999 and 2002 as a fixed income research and capital markets specialist.

Kissel is listed on the Journal's website as a member of the editorial staff and her bio includes her time at Goldman Sachs and notes that she worked for the company in both New York and London.

On Wednesay, Warren testified before a House subcomittee, providing 34 pages of written answers while submitting to two-and-a-half hours of aggressive questioning from congressional Republicans, who deployed talking points similar to those used in the recent Journal editorials.

"There has definitely been an uptick in attacks on her and on the agency over the past few weeks, it's hard to imagine it hasn't been well-coordinated by somebody," said a source close to Warren. "The smear campaign by The Wall Street Journal's editorial board this week includes the most unfactual and outrageous hit pieces on her yet. If it's true that the author of the editorials and Goldman Sachs coordinated on them, they should both be exposed and called to account."

The headline of Thursday's Journal editorial is "President Warren's Empire," which goes on to say, "The consumer bureau is essentially a bureaucratic rogue. We'd like to see Congress kill the agency entirely. But at the very least Congress should remove it from the Fed, make it part of the Treasury and subject it to annual appropriations."
. . . .
In a recent interview, Rep. Randy Neugebauer (R-Texas) acknowledged that the House GOP's efforts to curtail funding for the CFPB were essentially an effort to prevent the agency from conducting consumer protection regulation.

On Wednesday, the Journal accused Warren and the CFPB of "extorting billions of dollars from private mortgage servicers" in the agency's role as an advisor in negotiations to settle allegations of widespread fraud in the foreclosure process. The editorial also argues that "Ms. Warren is already using the Consumer Financial Protection Bureau to tell banks how and to whom to lend money."

The foreclosure process is in disarray, and even Republican state Attorneys General say that banks have broken the law with improper foreclosures. Consumer advocates have accused banks of levying heavy, improper fees against borrowers, driving them into foreclosure, while other borrowers have been foreclosed on without missing any mortgage payments. Banks have also physically broken into the homes of borrowers in order to pursue foreclosures.

Warren has publicly criticized Goldman in testimony before Congress and during on-air interviews with CNBC and Bloomberg. When Warren chaired the Congressional Oversight Panel for the Troubled Asset Relief Program, she told Sen. Chuck Grassley (R-Iowa) during a hearing that Goldman had not provided her panel with key documents pertaining to the bailout of AIG, from which Goldman reaped over $11 billion. She also said that the Wall Street giant should be investigated for wrongdoing pertaining to the sale of mortgage derivatives during the housing bubble. Goldman eventually settled with the SEC for $550 million over allegations that it defrauded investors.

Read the article here


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