After four years of investigating Goldman Sachs’ blatant mortgage abuses, the crooks go free.
What the heck does this say to the next round of crooks coming out of Wall Street with their derivatives and toxic debris.
People go to jail for stealing a loaf of bread while others stay free after stealing from the entire global finance system and simply walk away unscathed.
This is one of the few things I don’t like about this administration. Some people say they are beholden to the Banks for helping to get Obama elected in 2008. I tend to believe that, but wonder why Obama is still in the tank with Goldman Sachs, et al. Now, they refuse to endorse or support Obama’s bid for a second term…
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.
- DOJ Will Not Prosecute Goldman Sachs (abcnews.go.com)
- US Won’t Prosecute Goldman Sachs, Employees Over CDO Deals – Bloomberg (bloomberg.com)
- Government won’t prosecute Goldman Sachs in probe (kansascity.com)
- DOJ Will Not Prosecute Goldman Sachs in Financial Crisis Probe (news.yahoo.com)
- Government won’t prosecute Goldman Sachs in probe (news.yahoo.com)
- Justice Department won’t prosecute Goldman Sachs for financial crisis (foxnews.com)