One More SEC/Citigroup Sweetheart Deal - Five Reasons to Be Outraged

[Donnachaidh]

http://smirkingchimp.com/thread/rj-eskow/39079/one-more-sec-citigroup-sweetheart-deal-five-reasons-to-be-outraged

The President says he understands the frustration behind the Occupy Wall Street movement. That's nice. But the anger will keep growing as long as the government keeps handing out free passes instead of perp walks to bankers at serial corporate criminals like Citigroup.

The Administration is finally talking the talk, but without criminal investigations it's not walking the walk. Iit's still not too late. While the SEC's latest deal should outrage you, the Administration can makes things right with two decisive actions.

:snippage:

Here are five reasons you should be outraged. Warning: If you have high blood pressure, you should probably stop reading:

1. Once again, nobody had to confess.

:snip:

2. Once again the criminals won't pay for their crimes - you will.

more at the link --

[PETRUS]

1. Yup. nt

[Democrats_win]

2. Don't forget, it was Citi that DROVE the end of the Glass Steagall act.

When they bought Travelers, it basically forced the issue. Citi's new motto: Crooks since 1999.

[slipslidingaway]

3. knr, another snip ...

"...The SEC announced yesterday that Citigroup agreed to pay $285 million to settle charges that it misled (synonyms for that word include deceived; lied to; tricke and defrauded) investors in a mortgage securities deal, telling them it was a good investment when it knew otherwise and was secretly betting it would fail.

That kind of behavior isn't just slimy. As the Financial Crisis Inquiry Commission found in other instances, it's also illegal..."


And ...

SEC Doing Collusion Deals With Big Banks over Dodgy CDO Deals?

http://news.firedoglake.com/2011/10/21/sec-doing-collusion-deals-with-big-banks-over-dodgy-cdo-deals/

"Yesterday, I acknowledged and came within inches of praising an SEC resolution with Citigroup on a $1 billion mortgage-backed securities deal. They got $285 million in the settlement, all of which went to investors burned on the deal, which was similar to the setup of deals like Abacus or Magentar: end-bubble deals of synthetic CDOs that the bank knew would fail, where they had outside people with an interest in taking the other side of the bet construct the mortgage pool. This was rampantly illegal, and given some of the other settlements in this area, I thought a 28.5% return on the deal was noticeably higher.

But it turns out I was way premature in citing the SEC settlement as anything but craven. According to Pro Publica, Citi settled ALL its liability with the SEC from this one deal, even though they made plenty of other synthetic CDO deals at that time. They get this on the record from a Citi executive...

...Felix Salmon goes further, looking at all of the SEC’s CDO prosecutions. In all cases, they have made only one enforcement action for each bank investigated. That means that they make a high-profile and largely symbolic settlement on one deal, take back a thimble-full of cash, and ignore the dozens of other deals made under exactly the same premises for which they investigated and fined the bank.

...I think Felix uses the right word – collusion. This is regulatory capture of the first order. It’s different from constructing deliberately complex and confusing rules that will never be administered, or just looking the other way at misconduct. This generates the illusion of regulatory enforcement while letting off the offending parties for next to nothing. The exact same premise is at work with the Obama Justice Department’s attempted get out of jail free card for foreclosure fraud. It certainly makes the banks happy, but it’s also a primary reason why there are protesters in Zuccotti Park and across the country.

...Felix asks, “Is the SEC trying to protect the banks it’s meant to be prosecuting?” It sure looks that way."

[slipslidingaway]

4. kick nt

[riderinthestorm]

5. Kick again! nt

[Devil_Fish]

6. Great article. Read the whole thing! K&R NT

[slipslidingaway]

7. kick nt