from Hacker News

Why the S.E.C. didn't hit Goldman Sachs harder

by JMiao on 4/21/16, 5:51 PM with 191 comments

  • by inthewoods on 4/22/16, 3:58 AM

    Abacus is a more complicated case. The more shocking one to me is why Dick Flud isn't in jail. His use of the Repo 105 to move assets off the books to make Lehman look less leveraged and in better condition is a clearer case of fraud. He essentially did the same thing that Enron did - and Sarbanes Oxley requires that CEO sign off on the truthfulness of financial statements. Here's a guy that seems to have deliberately misled in those financial statements, yet he walks free. To me, that case is a more clear case of how the SEC is a toothless agency.

  • by Annatar on 4/22/16, 12:29 AM

    When I was growing up, my father used to tell me "bankers cause wars; they are the biggest criminals in the history of mankind." The article, and my own personal experience, which I'd rather not divulge in public, illustrate this perfectly. I know all the managers knew about the scam; they perpetrated it; and yet, they walk free and flush with cash from such deals, while ordinary people lost their homes and jobs. The S.E.C. is in cahoots with them. Essentially, the managers and lawyers inside of the S.E.C. and the banks found a way to commit criminal acts without going to prison.

    "Liberty and justice for all."

  • by Synaesthesia on 4/21/16, 8:18 PM

    Goldman Sachs has many well-documented connections to the US government & White house. https://prof77.wordpress.com/politics/an-updated-list-of-gol...

    http://www.whiteoutpress.com/articles/q42012/list-of-goldman...

  • by nickpsecurity on 4/21/16, 7:32 PM

    It's pretty simple: the Treasury head and many others in regulators are ex-Goldman. The word is subversion. The biggest violators have people embedded into the regulators to make sure they're not a problem.

  • by chollida1 on 4/21/16, 7:31 PM

    For those of you who haven't spent the past 10 years of your lives following this and want a quick TL/RD, the below link has a good recap of what Abacus is.

    http://www.reuters.com/article/us-goldmansachs-abacus-factbo...

  • by Von_Jones on 4/22/16, 7:17 AM

    I am not an American and I wonder why the most likely presidential candidate is the one taking somewhat opaque "speaker's fees" from an organisation that a lot of Americans realise operates in ways akin to a mafia. From the outside it like turkeys voting for Xmas.

  • by arca_vorago on 4/21/16, 8:55 PM

    I boil this down to a few categories of people in positions of government. There is a certain word, don't say it too loud or they might run or grab pitchforks, but the word is... cough... accountability.

    Looks around carefully. I spent some time contracting in DC, and the conclusion I came to is that there are three main types of people around the government and financial centers of power.

    1) Those who are aware of the coming shitstorm and the complete corruption and subversion, and are just trying to "get theirs". This usually ends up in a "I got mine, fuck you" attitude. They don't push back because they know they would get punished for it, so they instead use their knowledge to further their career at the expense of their duty, and principles. They know, but don't care (enough to risk anything) about the status quo.

    2) Those who know about the situation, and agree with it. These are usually indoctrinated extremists on either side of the spectrum, neocon, ultra-lib, the kind of people who now think capatalism in it's current form is the best gift from god and they speak of peace while selling massive amounts of weapons to dictators they setup all around the world. They know, and they care (for the wrong things), and actually perpetrate many of the abuses of the system.

    3) Those who are too ignorant or stupid to know, or the slightly modified, those who have an idea about how bad it is but would rather stick their head in the sand and pretend reality doesn't exist. They don't know and don't care.

    Don't tell me where all the true patriots went. I have told my friends, that "I know not one brave soul, not one." (keep in mind I'm not talking about media figures, like Snowden, Manning, Drake, Binney, Tice, Edmonds, all of whom I do consider brave souls) To me, that is the real problem I faced when I had my Descartes reset, in that I started to realize that while I still believe in the power of an oath, and the duties that come with them, the majority of the people around me and in positions of real power pay tons of lip service to principles, but never actually do them. Personally, I think this is causing a kind of mass cognitive dissonance and compartmentalization that we have yet to realize the full impact of.

    When I think about the leadership traits I learned in the Corps, and how little of them I see in our leaders, I fear for the future of my country.

    (in case anyone is wondering, they are: Justice, Judgement, Dependability, Initiative, Decisiveness, Tact, Integrity, Enthusiasm, Bearing, Unselfishness, Courage, Knowledge, Loyalty, and Endurance.)

  • by whatok on 4/21/16, 8:58 PM

    For people complaining about revolving doors, how do you get regulators with current industry expertise without.... industry experts?

  • by qaq on 4/22/16, 12:27 AM

    Mainstream Banks laundered close to 400 billions in drug money and got slapped with fines in 10 mil. range. Everyone is up in arms about GS. GS counterparties are supposed to be sophisticated Fund managers they are payed millions in fees for managing money. It's their job to do due diligence on the deals they do with GS or otherwise.

  • by cloudjacker on 4/21/16, 8:44 PM

    Sometimes I like to imagine that there are esoteric business relations like this in places like Palestine with an Israeli regulator.

    But I can never get a discussion deep enough going on about how the rule of law is implemented there.

  • by known on 4/22/16, 6:20 AM

  • by jbob2000 on 4/21/16, 6:56 PM

    Here's the TL;DR:

    "In our conversations, Kidney reflected on why that might be. The oft-cited explanations—campaign contributions and the allure of private-sector jobs to low-paid government lawyers—have certainly played a role. But to Kidney, the driving force was something subtler. Over the course of three decades, the concept of the government as an active player had been tarnished in the minds of the public and the civil servants working inside the agency. In his view, regulatory capture is a psychological process in which officials become increasingly gun shy in the face of criticism from their bosses, Congress, and the industry the agency is supposed to oversee. Leads aren’t pursued. Cases are never opened. Wall Street executives are not forced to explain their actions."

    Basically, regulators don't have the balls to go after the big guys.

  • by jheriko on 4/21/16, 11:56 PM

    TL;DR;

    they are inept and impotent.

  • by ErikAugust on 4/21/16, 7:25 PM

    The lyrics of this song contain the answer: https://www.youtube.com/watch?v=s2VG53RIJ50