Goldman to pay $550M to settle civil fraud charges

[Modbert]

Goldman to pay $550M to settle civil fraud charges - Yahoo! News

WASHINGTON – Goldman Sachs & Co. has agreed to pay $550 million to settle civil fraud charges that accused the Wall Street giant of misleading buyers of mortgage-related investments.

The deal calls for Goldman to pay the Securities and Exchange Commission fines of $300 million. The rest of the money will go to compensate those who lost money on their investments.

The fine was the largest against a financial company in SEC history.
Goldman earned $3.3 billion in the first quarter of this year. The company earned $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 center of the charges omitted key information for buyers.

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.

Thoughts USMB?

 

[hvactec]

should read: The Paulson Lloyd Gangsters and thugs better known as Financial terrorists commit Fraud & Treason then do a 550 Million payoff!

 

[Oddball]

So, they basically paid back a fraction of the bailout they got funneled their way from AIG.

Whoop-de-doo.

 

[topspin]

Love that analogy.
It's great for the market. To the investor class GS is the best financial company and is the gold standard.

 

[editec]

Goldman to pay $550M to settle civil fraud charges - Yahoo! News

WASHINGTON – Goldman Sachs & Co. has agreed to pay $550 million to settle civil fraud charges that accused the Wall Street giant of misleading buyers of mortgage-related investments.

The deal calls for Goldman to pay the Securities and Exchange Commission fines of $300 million. The rest of the money will go to compensate those who lost money on their investments.

The fine was the largest against a financial company in SEC history.
Goldman earned $3.3 billion in the first quarter of this year. The company earned $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 center of the charges omitted key information for buyers.

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.

Thoughts USMB?

I doubt the fines exceed how much they ripped off.

I doubt it's even10% of how much they made ripping off their clients.

That's how our American criminal justice system works for the insiders, folks.

 

[Oddball]

It's a drop in the bucket to the $12 BILLION Goldman got from the bailout.

What a charade.

 

[CrusaderFrank]

...and the band played on

 

[topspin]

Goldman almost exclusively deals with upper class people who know what they are buying and selling. their stock will go way up.

 

[hvactec]

American people should file a class action Lawsuit against Goldman, pension funds lost jobs lost, homes etc. the list goes on Fraud & more..

 

[topspin]

Simpletons

 

[hvactec]

Love that analogy.
It's great for the market. To the investor class GS is the best financial company and is the gold standard.

Goldman sachs is nothing more then Organized Crime Family of low life greedy blood sucking fraudsters that are sucking the life out of America...Enron

 

[FireFly]

Goldman almost exclusively deals with upper class people who know what they are buying and selling. their stock will go way up.

Many municipalities who invested in Goldman's "AAA" shit paper were not using money from upper class sophisticated investors. If you are wondering why your utility bills climbed 30% over the past few years while we were having deflation you can bet it was these type assholes who robbed your municipality of the money they had parked in "AAA" bonds waiting to pay for that new sewer or water treatment plant they had under construction.

These assholes robbed municipalities all over the planet. Now we get to pay these rich bastards through our higher monthly utility bills. Talk about robbing from the poor & retired elderly on fixed incomes.

Technically it may not have been illegal, but it is corruption of the highest order. Just imagine the politician or treasure at the municipality who made the decision to lose their municipalities funds getting kickbacks & campaign contributions from the winners who bet against these investments. It was a grand scheme between politicians & wall-street to rob citizens.

 

[sparky]

you mean Moody's ratings FF, G&S made sure they were the gold standard because they paid GOLD out to have it be so

and $500M?

that's merely supplying incentive to go on out and do it again to this class of people

 

[Baruch Menachem]

So, they rip of billions, break the world financial system, and they are have to pay a fraction of their petty cash.

It is like Bernie Madhoff being obliged to pay 3 cents in fines and two cents in restitution.

For what they did, there should have been long terms behind bars for most of the partnership, and all the partners should have been cleaned out down to their socks and undies to do the restitution.

 

[boedicca]

Thoughts: token slap on the wrist as part of the Kabuki Theater in promotion of the Financial Deform Bill which institutes Too Big Too Fail as a key mission for our the Feds, and which Lloyd Blankfein himself claims will be very profitable for Goldman Sachs.

 

[hvactec]

SEC Split Over Goldman Deal - JULY 16, 2010, 9:06 P.M. ET

By KARA SCANNELL and SUSANNE CRAIG
The Securities and Exchange Commission split in its decision to settle its landmark lawsuit against Goldman Sachs, The Wall Street Journal has learned, in a dispute over the agency's move to levy a $550 million fine even after diluting its fraud allegations against the giant bank.

The 3-2 decision on party lines Thursday came after a 30-minute closed-door session where the SEC's two Republican commissioners voted against settling, said people familiar with the matter. Mary Schapiro, the SEC chairman appointed by President Obama, cast the deciding vote, the people said.

Thursday's settlement—in which Goldman agreed to pay a $550 million fine, but didn't have to admit it committed fraud—capped one of the most closely watched cases in the SEC's 76-year history. The agency had charged Goldman with intentionally duping clients by selling a mortgage-security product that secretly was designed by another Goldman client betting that the housing market would crash.

People familiar with the matter say Republican Commissioner Kathleen Casey questioned the SEC staff Thursday on their decision to abandon the strongest fraud charge and strike a settlement involving a lesser allegation, and given that, how the SEC could justify such a large penalty on a lesser charge.

The political split over the case comes at a time when the agency remains under fire for its policing of the financial markets during the financial crisis. The SEC commissioners often split on party lines over policy decisions, but rarely do so on such high-profile enforcement cases.

full story
SEC Split Over Goldman Deal - WSJ.com

 

[william the wie]

So, they rip of billions, break the world financial system, and they are have to pay a fraction of their petty cash.

It is like Bernie Madhoff being obliged to pay 3 cents in fines and two cents in restitution.

For what they did, there should have been long terms behind bars for most of the partnership, and all the partners should have been cleaned out down to their socks and undies to do the restitution.

You have overstated the severity of the penalty (0.5/12= 4.17%) by more than 20%.