Hedge Fund SAC Facing Criminal Charges for Insider Trading

[Recursion]

http://www.slate.com/blogs/moneybox/2013/07/25/sac_criminal_charges_for_insider_trading.html

This has been expected all week, but it's official today that Steven Cohen's hedge fund SAC Capital is going to be hit with criminal charges relating to the insider trading allegations it's been facing for a while.

You probably don't care too much about the details of the case. Suffice it to say that if you're putting yourself in a position to personally suffer investment losses as a result of hedge funds insider trading, you're investing wrong. But the political signal here is important. In the wake of the Arthur Andersen case, the federal government started really shying away from leveling criminal charges against firms. The financial crisis actually further entrenched that instinct even as many people in the public felt it should push things in the other direction. The view was that criminal cases were unduly destabilizing to the economy as well as being relatively difficult to win. Better to keep them as a vague threat and reach settlements of various kinds.

The appointment of Mary Jo White to be the new SEC chair in Obama's second term was a pretty clear signal from the top down that there'd be much less of a good cop attitude going forward, but a lot of folks chose to misread this situation on the grounds that between serving in the Clinton administration at a high level and serving in the Obama administration at a high level White did white collar defense. But she's told her troops to knock it off with neither-admit-nor-deny settlements and now we've got the criminal case against SAC. My sense is that this is the right direction to go in, but I'll admit that my confidence level in that is fairly low. However, this is the kind of job you bring a badass prosecutor in to do—some badass prosecuting. There's some disquiet that Cohen isn't personally facing criminal charges here, but based on the accounts I've seen he really did structure things so as to make it exceedingly unlikely that he could be convicted of criminal charges. Which is to say he was smart. But he's looking at pretty serious civil penalties and the destruction of his business.

Yes, Obama is just like Bush

[SidDithers]

1. DU rec...nt

Sid

[KansDem]

2. Fine...and go after the rest of them!

Arrest HSBC Bank for laundering drug money --

NEW YORK — British banking giant HSBC agreed to pay a record $1.92 billion settlement Tuesday after a broad investigation by U.S. federal and state authorities found the bank violated federal laws by laundering money from Mexican drug trafficking and processing banned transactions on behalf of Iran, Libya, Sudan and Burma .

The settlement, a combination of forfeitures and civil penalties, shows the London-headquartered financial powerhouse for years deliberately channeled hundreds of millions of dollars of the prohibited transactions through its U.S. arm.

"HSBC is being held accountable for stunning failures of oversight — and worse — that led the bank to permit narcotics traffickers and others to launder millions of dollars through HSBC subsidiaries, and to facilitate hundreds of millions more in transactions with sanctioned countries," said U.S. Assistant Attorney General Lanny Breuer in announcing the largest settlement of its kind.

"The record of dysfunction that prevailed at HSBC for many years was astonishing," said Breuer.

--more--
http://www.usatoday.com/story/money/business/2012/12/11/hsbc-laundering-probe/1760351/

"Stunning failures of oversight?" Is that what they call it?

I break the law, I go to prison. They break the law, it's a "stunning failure of oversight!"

Who comes up with this horseshit? Oh, wait...from the article --

In January, HSBC hired Stuart Levey, a former Treasury undersecretary for terrorism and financial intelligence, as chief legal officer. And a former policy adviser in the Obama administration, Preeta Bansal, in October became HSBC's global general counsel for litigation and regulatory affairs.

Ah, yes...it's all clear now.