One of the interviewees is Daniel Alpert, a manager of an investment firm, and the other is Robert Gnaizda, an attorney. Both men have views on why no prosecutions are being (or will be) conducted by the Justice Department.
You may not necessarily agree with their views, but they present their reasons why there will not be any prosecutions. I leave you, dear readers, to identify for yourselves any deceptions, misperceptions, subterfuge, jiggery-pokery and window dressings that may have contributed to the lack of justice.
The following is a summary of what each man said.
Daniel Alpert
Alpert said that the cases against banks were complicated and that, anyway, the fraud was committed against the banks' shareholders and bond holders. He insisted the cases were too complex and tough to prosecute. He mentions the revolving door between the financiers and the government and regulatory positions. He things the Justice Department is doing its duty. Prosecutors do not like to take on cases they can't win. Criminal prosecutions would make financial recovery difficult.
He says the problem of the crisis is how little senior executives knew about what their companies were doing; therefore, it cannot be proven that executives were lying. He refused to name any names of the guilty even though he implied that there was a lot of guilt and that every major institution, except JP Morgan, was guilty.
He said the reluctance to create greater oversight is misplaced, but the financial system remains tenuous. If all assets of the banks were marked to market right now, they would be insolvent. Banks should be able to withstand financial crashes but cannot.
He thinks that Obama cannot bring the banks to heel. Finally he said, no one in government is willing to let any bank fail, not now or in the future.
Robert Gnaizda
Gnaizda had a different take on what should be done regarding the bank fraud. He thinks that top executives should be prosecuted. He started by naming Countrywide executive, Angelo Mozilo. He said what is missing are whistle blowers to talk to the justice system in order to bring about criminal prosecutions of all those involved in the Countrywide fraud.
Gnaizda also said that he would like to have all the leaders at Lehman, Bear Sterns, and other banks prosecuted. According to him, Mozilo's crime was greater than Madoff's. Because a prosecutor needs co-operating witnesses and because the Department of Justice did not talk to such witnesses, no one will be prosecuted.
He thought that effective regulations are necessary. He stated that Paulson would have done a better job at Treasury and would have prosecuted wrongdoers and would have helped more homeowners.
In the end, President Obama is to blame for the lack of prosecutions. He said Obama would never prosecute the wrong doers because of his fear of the banking system.
Hear the two interview here
5 COMMENTS:
It really was the perfect crime...where smarts and devious become one!
Letting No Disaster Go To Waste, SEC Prepares To Let Lehman Executives Walk For Repo 105 Fraud
The WSJ reports: "In recent months, Securities and Exchange Commission officials have grown increasingly doubtful they can prove that Lehman violated U.S. laws by using an accounting maneuver to move as much as $50 billion in assets off its balance sheet, which made it appear that the securities firm had reduced its debt levels....After zeroing in last summer on the battered real-estate portfolio and an accounting move known as Repo 105, SEC officials have grown more worried they could lose a court battle if they bring civil charges that allege Lehman investors were duped by company executives. The key stumbling block: The accounting move, while controversial, isn't necessarily illegal." Oh no, illegal it is. The problem is that should the SEC actually pursue it and win, that act would open up the floodgates for hundreds of lawsuits against everyone from Bank of America and Citi, which have also disclosed they used comparable tactics to misrepresent the true status of their books, to shady accounts like Ernst & Young, all the way to FASB at the very top of the corruption pyramid. And with hundreds of millions if not billions in legal fees about to be paid out if the fraudclosure back door settlement fails, the SEC simply can not allow the pursuit of justice to threaten the viability of America's only national interest: that of its criminal banking syndicate.
http://www.zerohedge.com/article/letting-no-disaster-go-waste-sec-prepares-let-lehman-executives-walk-repo-105-fraud
How do you get prosecutions from an establishment that looks at everything from a $ angle?
case in point...
CNBC’s Larry Kudlow expressed his relief in terms that seemed to appall even his fellow cheerleaders for capitalism: “The human toll here,” he declared, “looks to be much worse than the economic toll and we can be grateful for that.”
http://www.vanityfair.com/online/daily/2011/03/larry-kudlow-devalues-human-life-with-japan-earthquake-freudian-slip.html
Prosecutions for criminality?...do you know what that would do to the markets?...forget it............
TRY THIS....
Clawbacks: Ending Wall Street’s IBGYBG Bonuses
Want to reform Wall Street bonuses? Try clawbacks.
That's right. We need to make executives personally liable for their reckless bets if we want to remove the risk for taxpayers. That means giving shareholders, boards of directors and regulators the ability to "clawback" past gains when new speculations go horribly wrong.
http://www.ritholtz.com/blog/2011/03/ending-wall-streets-ibgybg-bonuses/
Thank you all for the links. Once again, it is hard not to feel defeated when the whole system of institutions seems to be betraying the individuals in that system. It would be nice to be able to start over. I sort of understand Mao's wish to have perpetual revolution so that every generation would renew its original ideals. We need some kind of change at any rate.
Boy these prosecutors know how to work fast and hard WHEN they are working FOR GOLDMAN BUT somehow can't build a case AGAINST THEM...
its like southern justice where the judge is the sheriffs uncle and the prosecutor is his cousin...straight to the work camp!
Prosecutors Seek 10-Year Term in Goldman Code Case
NEW YORK—A former Goldman Sachs Group Inc. computer programmer should be sentenced to up to 10 years and one month in prison for stealing the confidential source code of the investment bank's high-speed trading system, prosecutors said.
http://online.wsj.com/article/SB10001424052748703363904576200582856109422.html
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