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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

Sunday, December 9, 2012

Goldman Sachs's "Puny" Fines

Finally, someone from a regulatory body agreeing with us that Goldman Sachs's fines are ridiculously low and do not prevent Goldman from committing more offenses.  Here the offense is called a "goof" as though the bank is just a little bit stupid and does things without thinking but really means no harm.  Goldman really commits fraud for which it little cares whether or not it causes harm as long as the end result is profit and big salaries and big bonuses.  (See our definition of fraud above.)

Goldman routinely commits these offenses and frauds and expects to pay monetary penalties that it budgets for out of its massive profits each year.  It is laughably the least amount of pain that Goldman can ever experience because, ironically, these fines are miniscule in comparison with the harm they do to the financial system and compared with the monetary gains obtained by breaking the rules and/or breaking the law.  This is one crazy world.

A 'puny' fine for GS goof
By Kaja Whitehouse and Mark De Cambre - New York Post

An outspoken regulator lashed out at a $1.5 million settlement between Goldman Sachs and the Commodity Futures Trading Commission — calling the deal a steal for the Wall Street bank.
Bart Chilton, a CFTC commissioner, described the cash amount as “puny” and “a slap on the wrist” when compared to the whopping $8.3 billion trade at the center of the case.

In 2007, a Goldman trader hid the outsize trade as the market unraveled.

“This is another example of where puny penalties send the wrong message for these guys who are breaking the law,” Chilton told The Post.

“It’s not even a sneeze for them,” he said of the fine, which is roughly equivalent to what Goldman’s CEO Lloyd Blankfein would have pocketed in one week in 2007, when he earned $68 million.
Chilton was the sole dissenter on a 3-1 vote to fine Goldman.

CFTC Chairman Gary Gensler, who worked at Goldman Sachs for 18 years, recused himself from the case. 

Read the whole article here


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