SEC Blows Easy Prosecution of Toxic CDO Salesman

By: Wednesday August 1, 2012 6:54 am

The SEC managed to lose a layup of a case against former Citigroup executive Brian Stoker, in a case which revolved around CDO sales where Citi has already agreed to pay fines on the grounds that they misled investors and took the other side of the bet. The Securities and Exchange Commission had accused Brian [...]

Criminal Indictments in Credit Suisse Case Investigated Four Years Ago… By the Bank

By: Wednesday February 1, 2012 6:29 am

We open the day by hearing about criminal indictments for bond traders. Federal prosecutors are preparing to file criminal charges against former Wall Street traders alleging they misstated the value of mortgage bonds, an issue central to the 2008 financial crisis, according to people familiar with the matter. The Manhattan U.S. Attorney’s office is planning [...]

Banks Continue to Wriggle Out of New International Standards

By: Tuesday January 10, 2012 8:55 am

Major banks caught a break when federal regulators determined that financial institutions could plunge below international liquidity levels in the event of a financial crisis. Banks will be allowed go below minimum liquidity levels set by global regulators during financial crises to avoid cash-flow difficulties. “During a period of stress, banks would be expected to [...]

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

By: Friday October 21, 2011 7:35 am

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 [...]

SEC Puts Standard and Poor’s on Notice for Civil Charges on 2007 MBS

By: Tuesday September 27, 2011 6:55 am

The SEC has told Standard and Poor’s that they may file civil charges over the rating agency’s role in a 2007 mortgage backed securities deal. The formal warning of potential imminent charges, known as a Wells notice, was delivered yesterday. This warning, thought to be the first Wells notice against a rating agency related to [...]

Levin Report Postscript: Wall Street and Its Regulators Basically the Same Post-Crisis

By: Friday April 15, 2011 2:01 pm

Yesterday, Carl Levin introduced his long and relatively effective report on the financial crisis. It focused on four major aspects: mortgage fraud, weak and deferential regulation, the credit rating agencies and investment bank malpractice with mortgage bonds. Levin said that he referred some issues to the Justice Department for potential prosecution. But we can actually [...]

The Fall Of Goldman Sachs?

By: Monday April 19, 2010 6:15 am

The last 72 hours have left Goldman Sachs with a shattered reputation among the people who matter to them, their customers and the politicians they have courted. The SEC’s civil fraud suit over one of their synthetic CDO deals is bad enough, but it’s just getting worse and worse for them. First of all, the [...]

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