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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

Thursday, July 14, 2011

Why Would Anyone Do Business With Goldman Sachs?

The most important deregulatory action of the Bush Administration that explains why Goldman Sachs has not been criminally prosecuted for its role in helping to create the financial crisis of 2008 comes in the form of "guidelines" for a "softer approach" to corporate crime as explained in the article link below and in the interview. Self-regulation is a form of deregulation and a gentleman's agreement to be honest and deal fairly is not worth anything. "Deferred prosecutions" are equivalent to no prosecutions at all.

One wonders why the Obama administration is following so many of Bush's policies. These policies show how Wall Street has captured the government. Why are Bernanke and Geithner still making policy in government when they facilitated many of the actions that contributed to huge mortgage fraud and the corruption of banking?

Goldman Sachs knows it does not need to fear prosecution for its fraudulent, unethical and immoral practices. Goldman Sachs is not so golden to some people. See this article. Perhaps the only way to get public satisfaction against fraud is through the private lawsuits that may bring Goldman Sachs to heel. The government and the justice system seem to have handcuffed themselves against taking proper actions against fraud.

If, as some believe, Goldman Sachs "is a veritable indicator of the country's well-being and a major contributor to wealth and securities management" (when the wealth is for themselves and the securities have already co-opted the wealth of others) then the country will be in a lot of trouble for a long time to come!

Below is an interview with Louise Story, a reporter with The New York Times, who talks about the reasons for no criminal prosecutions for the fraud committed by Goldman Sachs and others.

Read the NPR article accompanying this interview about Why Prosecutors Don't Go After Wall Street here.


Anonymous said...

It's getting in your face and intolerable...

Wall Street Lobbyists Aim to ‘Reform the Reform’

Within minutes of arriving, Steve Bartlett, the head of a group representing 100 of the nation’s largest financial institutions, was deriding a proposal aimed at limiting the fees that banks charge retail stores on debit-card purchases.

Mr. Bartlett, wearing ostrich leather cowboy boots, barked orders to surprised Congressional staff members, urging them to delay the rule, according to two people who attended. He acted like someone running the meeting, they said, rather than like an invited guest.

Though little known outside Washington and Wall Street, Mr. Bartlett has played a pivotal role with other lobbyists in their fierce and frenetic behind-the-scenes effort that has successfully delayed or watered down many of the major regulatory changes passed by Congress in the aftermath of the financial meltdown.
In recent months, Mr. Bartlett’s team has gone into high gear, sending regulators some 100 letters proposing changes to soften the Dodd-Frank rules and holding dozens of meetings with lawmakers and regulators, including the Securities and Exchange Commission, the Commodity Futures Trading Commission and other federal agencies.

The Commodity Futures Trading Commission, according to one of its officials, is even reconsidering plans to curb banks’ control over derivatives, once seen as a cornerstone of Dodd-Frank.
After serving as mayor of Dallas, Mr. Bartlett landed the top spot at the roundtable in 1999. He said he had been hired in part to “secure passage” of the Gramm-Leach-Bliley Act, which repealed some of the Glass-Steagall restrictions on banks set after the Great Depression. The law, signed in 1999, allowed investment banks and commercial banks to merge, creating the Wall Street powerhouses that eventually proved too big to fail during the crisis.

Anonymous said...

In 2008, the U.S. experienced its own banking crisis after a burst real estate bubble. Banks were bailed out with a transfusion of government money. Most major banks were spared bankruptcy and even the need to fully write off bad debts and recapitalize. Moreover, the practice of creating and selling dubious derivatives that helped trigger the crisis was never stopped. It continues to this day, without transparency, and without a clearing agency to create and oversee standards. Doing business as before permits excess leverage and continued risk for the U.S. banking system. Like the Japanese banks before them, American banks are not liquid enough to lend and take the risks needed to create strong economic growth. Bad loans that have not been written off continue to plague them.

Anonymous said...

Listen to the mainstream media and none of the above is placed into perspective. The reporting is serial and disconnected. In many cases it is determinedly optimistic. It wouldn't do for elite media to admit the truth. The idea that the Western dollar reserve system basically died in 2008 and only the injection of some US$50 TRILLION around the world has saved the system from complete collapse is not an acceptable epiphany.

The elite – in aggregate – needs to keep on spinning its promotions. They are hiding the collapse. They never tell the truth. In this case the operative plan seems to be top put on a happy face until the damage is so widespread and people are so miserable that they will agree to anything, including world government.

The mendacity is breathtaking. If people don't know what's going on, how can they plan? If they are being lied to by their most "trusted" mainstream media sources, how can they create valid strategies for themselves and their loved ones?

Anonymous said...

As Dennis Kucinich writes today:

We have to realize what this country's economy has become. Our monetary policy, through the Federal Reserve Act of 1913, privatized the money supply, gathers the wealth, puts it in the hands of the few while the Federal Reserve can create money out of nothing, give it to banks to park at the Fed while our small businesses are starving for capital.

Mark my words -- Wall Street cashes in whether we have a default or not. And the same type of thinking that created billions in bailouts for Wall Street and more than $1 trillion in giveaways by the Federal Reserve today leaves 26 million Americans either underemployed or unemployed. And nine out of ten Americans over the age of 65 are facing cuts in their Social Security in order to pay for a debt which grew from tax cuts for the rich and for endless wars.

There is a massive transfer of wealth from the American people to the hands of a few and it's going on right now as America’s eyes are misdirected to the political theater of these histrionic debt negotiations, threats to shut down the government, and willingness to make the most Americans pay dearly for debts they did not create.

These are symptoms of a government which has lost its way, and they are a challenge to the legitimacy of the two-party system.

Anonymous said...

Rakoff Allows Gupta's Lawsuit Against S.E.C. to Proceed
Judge Rakoff ruled that Rajat K. Gupta, the former Goldman Sachs and Procter & Gamble director, can proceed with a lawsuit that accuses the Securities and Exchange Commission of violating his constitutional rights.


Anonymous said...

Rakoff Allows Gupta's Lawsuit Against S.E.C. to Proceed
Judge Rakoff ruled that Rajat K. Gupta, the former Goldman Sachs and Procter & Gamble director, can proceed with a lawsuit that accuses the Securities and Exchange Commission of violating his constitutional rights.


Anonymous said...


The time has come to deploy this emerging stratagem against the greatest corrupter of our democracy: Wall Street, the financial Gomorrah of America.

On September 17, we want to see 20,000 people flood into lower Manhattan, set up tents, kitchens, peaceful barricades and occupy Wall Street for a few months. Once there, we shall incessantly repeat one simple demand in a plurality of voices.

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