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Date: 2024-10-31 Page is: DBtxt001.php txt00002996

Companies ... Goldman Sachs
Still an anti-social operation

Justice Dept. Ends Investigation Into Goldman Sachs Mortgage Abuses Without Pressing Charges

COMMENTARY
Why did the Department of Justice close this investigation? Was it because the Obama campaign is not getting enough campaign contributions from Wall Street or was it because the Obama administration has to follow the law. My impression is that the rule of law in modern society has been deeply corrupted by lobbyist who have inserted all sorts of loopholes into the law so that behavior that most ordinary people would consider to be wrong, is in fact, legal. This has been going on for at least forty years ... probably a lot longer.

On partisan politics it is easy to say this case was dropped because of the campaign finance issue ... but the reality is likely to be loopholes in the law that made making the case impossible.

In the court of public opinion, Goldman Sachs is a criminal operation ... and it would not surprise me at all if the firm loses out in the not so long run. I know I have seen very little about Goldman Sachs in the last few years that casues me to have any respect for the firm, its staff and increasingly its alumni.
Peter Burgess

Justice Dept. Ends Investigation Into Goldman Sachs Mortgage Abuses Without Pressing Charges

After a year-long investigation into Goldman Sachs, the bank singled out by a Senate investigative committee for its abusive mortgage practices in the run-up to the financial crisis, the Justice Department announced Friday that it would not press charges against the bank. Goldman Sachs became of the face of widespread mortgage fraud and abuse that led to the subprime mortgage crisis when evidence that it had made trades described by its own bankers as “shitty deals” came to light during a Senate investigation in 2011.

The Department of Justice, however, concluded that it did not have enough evidence to meet the “burden of proof” required for charges, the Wall Street Journal reports:

“Based on the law and evidence as they exist at this time, there is not a viable basis to bring a criminal prosecution with respect to Goldman Sachs or its employees in regard to the allegations set forth in the report,” the statement read. [...]
In a statement Thursday, Goldman said: “We are pleased that this matter is behind us.”

DOJ’s investigation began after an April 2011 report from the Senate Permanent Committee on Investigations revealed that Goldman Sachs had pushed its clients to make trades on risky mortgage-backed securities and credit default swaps even as the bank was betting the same securities would lose value. Though Goldman Sachs was “doing God’s work,” according to chief executive Lloyd Blankfein, other bankers described pushing “shitty deals” on customers. In March of this year, a Goldman Sachs trader lambasted the bank’s “toxic and destructive” culture in a scathing resignation editorial in the New York Times; a former Goldman partner followed up the next week by admitting that the bank’s “commercial animals” had duped customers and peddled “junk” to its clients.

The Securities and Exchange Commission also declined to press charges related to the bank’s role in a $1.3 billion sale of mortgage-backed securities, a reversal from last month when it indicated that it would recommend criminal prosecution. In July, Goldman settled a civil suit with the SEC for $550 million, and it faced sanctions from the Federal Reserve in September.

DOJ reserved the right to re-open the case and press charges should new evidence emerges, but for now, the case seems the latest in a string of them in which the biggest purveyors of the toxic assets that led to the financial crisis walk away with minimal penalties and, in many cases, no penalty at all.


By Travis Waldron
on Aug 10, 2012 at 10:45 am
The text being discussed is available at
http://thinkprogress.org/economy/2012/08/10/670951/goldman-sachs-justice-department-no-charges/
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