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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, August 11, 2011

Goldman Sachs Being Investigated for Bribery

From Wikipedia concerning the bailout of the Mexican peso in 1995:

"The Mexican "bailout" attracted criticism in Congress and the press for the central role of the former Co-Chairman of Goldman Sachs, U.S. Treasury Secretary Robert Rubin. Rubin used a Treasury Department account under his personal control to distribute $20 billion to bail out Mexican bonds, of which Goldman was a key holder."

Goldman Sachs did all right from that deal. Now, however, it may not do so well with its deals in Libya. In 2008, Goldman Sachs was asked to invest $1.3 billion in a currency bet. The trade cost Khadafy 98% of his investment. Now Goldman Sachs is being investigated by the SEC for bribery in those deals with Libya:

SEC Probes Goldman Over Libya Deals
By Samuel Rubenfeld - Corruption Currents

Goldman Sachs Group Inc. said in a securities filing regulators are investigating whether the firm violated U.S. foreign bribery laws.

The Wall Street Journal reported Wednesday on the filing, which was made late Tuesday. Goldman said in the filing that a probe of the company’s “compliance with the U.S. Foreign Corrupt Practices Act” was among the string of investigations and regulatory reviews it faced in the past quarter.

The revelation was part of an 8,179-word “Legal Proceedings” section of its quarterly report to the Securities and Exchange Commission.

Goldman didn’t elaborate further in the text of the filing and declined to comment to the Journal about it. The SEC also declined to comment to the Journal.

Sources told the Journal that the SEC is looking over Goldman’s dealings with Libya’s sovereign-wealth fund, known as the Libyan Investment Authority. Goldman made options trades for the fund in 2008, but the trades ended up losing $1 billion.

The Journal reported in June about the scrutiny over Goldman’s work with the LIA, focusing on an initial agreement to pay the fund a $50 million fee to help it recoup some of the losses. Though Goldman never made the payment, it is still potentially exposed to the FCPA, which bans bribing — or offering to bribe — foreign officials to keep or obtain business.

Libya’s sovereign-wealth fund planned to pass the $50 million fee to an outside adviser called Palladyne International Asset Management BV, which was owned at the time by the son-in-law of the head of Libya’s state-owned oil company, documents reviewed by the Journal said.

The SEC’s investigation of Goldman is separate from its ongoing examination of ties between financial firms and sovereign-wealth funds, sources told the Journal.

See the article here


Anonymous said...

Welcome to the Age of Instability (August 11, 2011)

The phony fixes have failed, and the dam of toxic sludge and debt is leaking; instability will be the New Normal until the dam finally bursts and the financial Status Quo is swept away.

If you liked the past two weeks, you're going to love the next two years: welcome to the age of instability. As I explained yesterday, the quasi-religious belief in the stock market as a secure store of wealth has faded, and for good reason: The Junkie in the Pool and False Idols: Faith in Wall Street and The Fed Has Has Eroded (August 10, 2011).

In a nutshell, the Federal Reserve and Federal government's extend-and-pretend, mark-to-fantasy, paper over bad private debt with trillions in public bad debt "fixes" of the broken economy have failed, completely, utterly, miserably. Rather than drain the cesspool of impaired debt, risky bets gone bad and rampant abuse of the rule of law, the Fed and the Central State have poured trillions of dollars more bad debt into the fetid pool of sewage and sludge, which is now full to bursting.

You probably could start the investigation closer to home.

Anonymous said...

Robert Rubin, Bank America and the fate of the dollar

The reason for the inaction in Washington, needless to say, has to do with the vacuum surrounding President Obama, a lack of political substance which stems from the continuing influence, nay hegemony, of former Citigroup Chairmen Robert Rubin and his minions. Older more experienced Rubin operatives such as Larry Summers have already abandoned the sinking ship, but Treasury Secretary Timothy Geithner remains, we are told, until Rubin gives him permission to leave the table.

Anonymous said...


Hey you rebels, radicals and utopian dreamers out there,

We are living through a rare crisis and moment of opportunity. Western industrialized nations are now being masticated by the financial monster they themselves created. This is triggering a mood that alternates between angry denial and sudden panic. It looks like something is about to break, opening the space for a necessary transformation and a total rethink of global economic affairs. Events are playing perfectly into our September 17 occupation of Wall Street.

Anonymous said...

And top banking expert Chris Whalen says:

We need to seize and restructure Bank of America NOW! The Founders embedded bankruptcy into the constitution for a reason.

We're going into a double dip because the big, insolvent banks - like B of A - were bailed out and allowed to keep on committing fraud.

If we don't break them up now, we'll experience many more years of economic crisis.

Anonymous said...

Got to prevent haircuts for bondholders but those SS beneficiaries...just F@$% THEM!

Completing the Theft from the Social Security Trust Fund

The Catfood Commission rump report made it crystal clear that the political and financial elites have no intention of ever paying off the bonds held by the Social Security Trust Fund. You thought you were paying excess FICA taxes so that there would be enough money to pay your Social Security in your retirement, but that was never the intention. The intention was to raise your taxes and cut taxes on the rich.

The whole point of every charade version of “strengthening Social Security” is to insure that the income of the system is enough to pay the benefits that are due that year, hopefully with an overage that can be swallowed up in the General Fund and used keep the taxes on the rich at the lowest level since the time whereof the memory of man runneth not to the contrary. The Catfood Commission, the Great Compromise, the Gang of Six, the Chained CPI, and all other plans make it clear that the elites of both parties intend to complete the theft from the Social Security Trust Fund by raising your taxes and/or cutting your benefits.

You are not represented in the halls of government. Only rich people and their corporations and their lobbyists and their flacks, and their court jester economists, and their astroturf groups and their talk radio liars and their media companies and their think tanks and their foundations are represented in government.

Anonymous said...

These riots reflect a society run on greed and looting

While bankers have publicly looted the country's wealth and got away with it, it's not hard to see why those who are locked out of the gravy train might think they were entitled to help themselves to a mobile phone. Some of the rioters make the connection explicitly. "The politicians say that we loot and rob, they are the original gangsters," one told a reporter. Another explained to the BBC: "We're showing the rich people we can do what we want."

Most have no stake in a society which has shut them out or an economic model which has now run into the sand. It's already become clear that divided Britain is in no state to absorb the austerity now being administered because three decades of neoliberal capitalism have already shattered so many social bonds of work and community.

What we're now seeing across the cities of England is the reflection of a society run on greed – and a poisonous failure of politics and social solidarity. There is now a danger that rioting might feed into ethnic conflict. Meanwhile, the latest phase of the economic crisis lurching back and forth between the United States and Europe risks tipping austerity Britain into slump or prolonged stagnation. We're starting to see the devastating costs of refusing to change course.

Anonymous said...

Bribery..its pervasive...and normal

Pfizer Inc. (PFE) Confesses About "Potential" Overseas Bribes

8/12/2011 7:05:58 AM

In another instance in which a drugmaker appears to have bribed overseas officials, Pfizer has “voluntarily” provided the US Department of Justice and the US Securities and Exchange Commission with information concerning “potentially improper payments made by Pfizer and Wyeth personnel in connection with certain unspecified sales activities outside the US. The move comes amid increased scrutiny by the feds into the pharmaceutical industry and its interactions with foreign health care systems. In late 2009, the head of the Justice Department’s Criminal Division warned drugmakers that there will be more criminal enforcement against interactions with foreign officials as they seek violations of the Foreign Corrupt Practices Act (see here).

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