Goldman Sachs & Co. has agreed to pay US$550 million to settle civil fraud charges that accused the Wall Street giant of misleading buyers of mortgage-related investments.
The settlement came on the same day that the Senate passed the stiffest restrictions on banks and Wall Street since the Great Depression.
The deal calls for Goldman to pay the U.S. Securities and Exchange Commission fines of $300 million. The rest of the money will go to compensate those who lost money on their investments. Investors get $0.25 on the dollar for Goldmans Sachs deliberate defrauding them of $1 billion. A slap on the wrist for Goldman Sachs who earned $3.3 billion in the first quarter of this year and $13.4 billion in 2009.
The settlement also requires Goldman to review how it sells complex financial mortgage investments. Goldman acknowledged in a court filing that its marketing materials for the deal at the centre of the charges omitted key information for buyers.
But Goldman did not admit legal wrongdoing.
The investments were crafted with input from a Goldman client who was betting on them to fail. The securities cost investors close to $1 billion while helping Goldman client Paulson & Co. capitalize on the housing bust.
The civil charges the SEC filed April 16 were the most significant legal action related to the mortgage meltdown that pushed the country into recession.
A very sweet deal indeed for Goldman Sachs as the SEC just gave Goldman Sachs a Get out of Jail Free Card deal. Not only did Goldman Sachs defraud investors of $1 billion but they also defrauded the American people of over $4.5 trillion. In 2008 Goldman Sachs converted to a bank holding company and took $10 billion from the U.S. taxpayers after declaring a 2008 fourth-quarter loss of $2.12 billion. Not bad of a deal. Claim to lose $2.2 billion and get $10 billion - nearly 5 times more than what was needed to balance the books. A $7.8 billion profit taken in, not from banking, but given freely by the US government. No wonder the US got into a financial crisis so quickly. Washington can’t do simple arithmetic.
It was Goldman Sachs subprime mortgage scheme that caused the mortgage meltdown and plunged the US into a recession. The damage they caused to the United States economy demanded a full investigation and civil trial. Before it was just Goldman Sachs being charged with fraud, Now that the SEC has allowed them to walk away screams of a conspiracy. The question now is why did the SEC make a deal with Goldman Sachs? Did the Obama government have anything to do with this grave injustice? The Democrats were after all the main beneficiary of Goldman Sachs’ campaign contributions and the Obama administration is stacked with former Goldman Sachs workers, advisors and CEOs.
HILLARY CLINTON, United States Secretary of State received $millions from Goldman Sachs when she was first lady and then Senator for New York State from 2001 to 2009. The New York investment giant Goldman Sachs paid her husband, former United States President Bill Clinton, $650,000 for four speeches in recent years. Goldman Sachs employees and PAC have given her $270,000 since 2000 — putting it second on the list of her most generous political patrons. Although Barack Obama was the overwhelming favorite of Goldman Sachs to be president in 2008, for he could serve as their Trojan Horse, they were smart enough to hedge their bets, so to speak and back Hillary too. According to the Washington Examiner, Goldman Sachs in 2008 alone gave Hillary: $415,595.63 (inflation adjusted), which was itself almost three times as much as Bush received as well. Henry M. Paulson, Jr., then C.E.O. of Goldman Sachs and now former Treasury Secretary, Mayor Bloomberg, then Sen. Clinton and Sen. Schumer were all at the Goldman Sachs’ groundbreaking ceremony in Battery Park City on November 29, 2005, heralding the start of construction on a glimmering new 43-story tower that will serve as Goldman Sachs’s world headquarters come 2009. It was Hillary’s hubby Bill Clinton who chose ex-Goldman chief Robert Rubin to serve in his White House - served as the 70th United States Secretary of the Treasury during both the first and second Clinton administrations. Former President Bill Clinton and Secretary of State Hillary Clinton’s daughter, Chelsea, is engaged to the son of former Iowa congressman and convicted felon Edward Mezvinsky and former NBC reporter and congresswoman Marjorie Margolies Mezvinsky, and Goldman Sachs Investment banker Marc Mezvinsky. Engaged to Chelsea Clinton in November 2009. Expected to marry on July 31, 2010. Purchased a 1,900-square-foot Fifth Avenue apartment for about $4 million in February 2008.
ELENA KAGAN, was appointed by Obama to serve as the Solicitor General. The Solicitor General, often called the 10th Supreme Court Justice, is the person who argues the U.S. government side of cases before the court. From 2005 to 2008, according to USA Today and other sources, Kagan served as a member of the Research Advisory Council of the Goldman Sachs Global Markets Institute. Kagan received $10,000 from Goldman Sachs for her services in 2008, per federal disclosure forms. But since she was doing the same thing in 2005, 2006, and 2006, it would appear that she pulled in $40,000 from Goldman Sachs for what appears to be sitting in on one day sessions looking at big issues affecting the global economy.
HOWARD P. BERKOWITZ, serves as the Chairman, Board of Directors of the Washington Institute for Near East Policy (WINAP). It is an important Washington think tank that gives input to Obama. It was established by the American Israel Public Affairs Committee (AIPAC) in 1985, according to Wikipedia. People affiliated with WINAP are a virtual Who’s Who of foreign policy including Henry Kissinger, Warren Christopher, Lawrence Eagleburger, and Richard Perle. Berkowitz also is Managing Director of BlackRock and sits on the Advisory Council of the Goldman Sachs funded Hamilton Project (Brookings Institution). BlackRock is a global investmentment management firm with over $3.35 trillion under management.
WILLIAM C. DUDLEY, according to the Federal Reserve Bank of New York web site: “became the 10th president and chief executive officer of the Federal Reserve Bank of New York on January 27, 2009. In that capacity, he serves as the vice chairman and a permanent member of the Federal Open Market Committee (FOMC), the group responsible for formulating the nation’s monetary policy. Mr. Dudley was a partner and managing director at Goldman, Sachs & Company and was the firm’s chief U.S. economist for a decade. Earlier in his career at Goldman Sachs, he had a variety of roles including a stint when he was responsible for the firm’s foreign exchange forecasts. Prior to joining Goldman Sachs in 1986, he was a vice president at the former Morgan Guaranty Trust Company. Mr. Dudley was an economist at the Federal Reserve Board from 1981 to 1983.”
BLAIR W. EFFRON, is a money man. As a bundler for the 2008 Obama campaign, he raised more than $100,000. A “Mega Donor” to Obama in 2008, giving more than $28,500 though committees supporting Obama. His wife is also a major contributor, giving tens of thousands of dollars. Effron is a founding partner of Centerview Partners LLC. Their web site indicates he has executed over $400 billion in transactions. Effron is also on the Advisory Council of the Goldman Sachs/Robert Rubin funded Hamilton Project.
Michael FROMAN, is deputy assistant to the president and deputy national security adviser for international economic affairs, a position to be held jointly at the National Security Council and the National Economic Council. His responsibilities will include serving as the White House liaison to the G7, G8 and G20 summits of economic powers. Froman’s days with Obama go back to Harvard Law School. Froman appears to be the original link between Robert Rubin/Goldman Sachs and Obama. Froman received a bachelor’s degree in Public and International Affairs from the Woodrow Wilson School of Princeton University in 1985, a doctorate in International Relations from Oxford University and a law degree from Harvard Law School where he was a classmate of Barack Obama, and also an associate of Obama’s on the Harvard Law Review. After Harvard, Froman had lost touch with Barack Obama until Froman heard of Obama’s Senate run. Froman volunteered at that point to help, began raising funds for the candidate, and introduced the candidate to Robert Rubin (who spent 26 years at Goldman Sachs eventually serving as a member of the Board, and Co-Chairman from 1990-1992. Rubin sparked controversy in 2001 when he contacted an acquaintance at the Treasury Department and asked if the department could convince bond-rating agencies not to downgrade the corporate debt of Enron, a debtor of Citigroup. Rubin wanted Enron creditors to lend money to the troubled company for a restructuring of its debt.), whom Froman had followed from the Treasury Department to Citigroup [Froman served as Rubin’s Chief of Staff] after the Clinton administration. Before moving to the Obama administration, Froman most recently was a managing director of Citigroup’s Citi Alternative Investments Institutional Clients Group, where he was head of infrastructure and sustainable development. He also served on 12-member advisory board of the Obama campaign’s transition team.
ANNE FUDGE, appointed by Obama to his budget deficit reduction committee. Fudge has been the public relations craftsman for some of America’s largest corporations. She sits, according to the Washington Post, as a Trustee of the Brookings Institution within which the Goldman Sachs/Robert Rubin funded Hamilton Project is embedded.
PHILLIP MURPHY, appointed by Obama to serve as his Ambassador to Germany. In the 1990’s, Murphy, who worked for decades with Goldman Sachs, served as GS’s head of its German offices. From 1997-1999, Murphy served as President of Goldman Sachs, Asia (during the Asian economic crisis). In all, according to Wikipedia, Murphy spent 23 years at Goldman Sachs including as a Senior Director of the firm in 2003 before retiring from GS in 2006.
MICHAEL D. GRANOFF, is another money man, and a “mega donor” to the Obama campaign. At least $28,500 according to Public Citizen. Granoff is President, CEO and Founder of Pomona Capital, a venture capital group. Granoff is also one of the 19 members of the Goldman Sachs-Robert Rubin funded Hamilton Project.
EDWARD MICHAEL LIDDY, was, until recently, the CEO of AIG which, during the Obama administration, was essentially taken over by the US government. He served in high positions at Goldman Sachs including : Board Member (Chairman, 1990-94; Director, 2003-2008). He was picked to the Goldman board by none other than Hank Paulson, former head of Goldman Sachs who was Bush’s Treasury Secretary who with Obama’s Treasury Secretary (Geithner) fashioned TARP. Barack Obama as President kept Mr. Liddy on while AIG was essentially in receivership under the Obama administration. How about this for a conflict of interest, as reported by Wikipedia: Liddy owns 27,129 shares in Goldman Sachs, at the time worth just over $3 million. In April 2009 members of Congress called for Liddy to sell these shares, as they create a conflict of interest due to Goldman Sachs’ receipt of bailout money. Liddy announced on May 21, 2009 that he would resign as AIG Chairman and CEO when replacements were found, suggesting that the two roles be split. On August 3, 2009, Robert Benmosche was named President and CEO of AIG.
DUNCAN NIEDERAUER, is CEO of the New York Stock Exchange. While a private entity, it is heavily regulated by the government and has close government ties. Niederauer, for instance, is a frequent speaker at Federal Reserve events and has an extensive Goldman Sachs background: He joined NYSE Group following a 22-year career at Goldman Sachs. He served as a Managing Director of Goldman Sachs since 1997 and was responsible for U.S. cash equities operations, including Institutional and Member Firm Client Group sales and client services for … both the New York Stock Exchange and NYSE Arca. Mr. Niederauer was previously a Partner at The Goldman Sachs Group, Inc. (United States) (”GS”) where he held many positions.
RICHARD PERRY, is an Obama supporter, adviser and fund raiser. He worked for Goldman Sachs and is on the Goldman Sachs’ funded, Hamilton Project’s Advisory Council. He is also CEO of Perry Capital, a hedge fund. Perry owns the full floor penthouse at 1 Sutton Place in NYC and according to the Washington Examiner is one of 15 ” fat cat Wall St. Banker” friends of Obama.
LAEL BRAINARD, is the United States Under Secretary of the Treasury for International Affairs in the administration of President Barack Obama. She is an associate and protege of Mr. Goldman Sachs, Robert Rubin. She has written numerous articles and bookson the joys of outsourcing work overseas. Brainard also worked at Brookings which has embedded within in Goldman Sachs and Robert Rubin’s Hamilton Project.
JOHN THAIN, has served as a Henry Paulson aide whom Timothy Geithner has retained at Treasury as an adviser. Thain was President and Chief Operating Officer of Goldman Sachs from 1999 to 2003.
LAURA D’ANDREA TYSON, an economic adviser to President Obama. Tyson is a Hamilton Project Advisory Council Member. The Hamilton Project as noted above was founded by Bob Rubin and Goldman Sachs and has close links to Obama personally.
STEVEN SHAFRAN, served as an advisor/aide to Timothy Geithner especially on TARP. Shafran, like a lot of other TARP advisers, has extensive ties to Goldman as a executive for years.
GARY GENSLER, Chairman of Commodity Future’s Commission, spent 18 years at Goldman Sachs.
MARK PETERSON, chief of staff to Timothy Geithner, is a former lobbyist for Goldman Sachs
DIANA FARRELL, Deputy Director to the National Economic Counsel, was formerly with Goldman Sachs.
With that many Goldman Sachs people installed in key places in the United States government it would be safe to say that Goldman Sachs controls Washington. It is no wonder that the SEC dropped fraud charges against Goldman Sachs. To many high ranking government officials in control of the White House.
