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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, April 6, 2013

Goldman Sachs Creates "Rogue Traders"

A former Goldman Sachs trader, Matthew Marshall Taylor, has pleaded guilty to unauthorized futures trading that cost Goldman $118 million.  He may get from 3 to 20 years in jail and $75,000 in fines.  Goldman paid a fine of $1.5 million to CFTC for not properly supervising its personnel.

Compare that treatment with MF Global Chief Executive, Jon Corzine (also formerly of Goldman Sachs) who is being accused by the trustee of causing the firm's collapse.  Corzine was also responsible for the disappearance of $1 billion in customer money.  However, Corzine was not deemed negligent and he does not admit doing anything wrong.

Note the differences in treatment for the lowly trader who pleads guilty and the might CEO who admits to nothing.

That is what a corrupt financial system and a rotting legal system looks like:  fines all round and only jail time for the small fry.

Ex-Goldman trader charged in $7.6 billion rogue trade
By AFP - The Newcastle Herald

A former trader at Goldman Sachs pleaded guilty Wednesday to fraud linked to a scheme to hide an unauthorised $US8 billion ($7.6 billion) futures bet he made at the US banking giant.

Matthew Marshall Taylor surrendered to the Federal Bureau of Investigation early in the day, then entered his guilty plea in Manhattan federal court. He could face a maximum penalty of 20 years in prison, but prosecutors recommended a much lighter 33 to 41 months as a result of the plea deal.

The trader was on Goldman Sachs Capital Structure Franchise Trading desk in New York with a salary of $US150,000 and expecting a bonus of $US1.6 million in 2007, the year that he turned rogue, prosecutors say.

In November 2007, after he lost a "significant portion" of profits he'd earned in his account that year, Taylor was told by superiors to scale back his risk-taking and informed his bonus would be cut back.

Read the entire article here 


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