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Quote of the Day
From Securities and Exchange Commission enforcement chief Robert Khuzami, describing the way that Galleon Group's Zvi Goffer tried to keep his insider trading a secret:
If you find yourself chewing the memory card in your cellphone to destroy any record of your misconduct, something has gone terribly wrong with your character.
Roger that. As an added bonus, the linked article also interviews "an eavesdropping-detection specialist" who says he's turned down three separate firms recently who were all desperate to know if the government was bugging them. Hooray for Wall Street!
Going on for years
A few years ago a friend of mine was applying for a job as a broker at a Wall St. firm (located in Midtown, of course) and he was searched before the interview to make sure he wasn't wearing a wire for the FBI.
These are the people we bailed out.
Solid state memory is
Solid state memory is actually quite resilient. The memory chip itself is probably a small component that could be removed and placed in an unchewed card.
Besides doesn't the phone company have all the damning information on their end?
Goffer is small potatoes,
Goffer is small potatoes, basically unrelated to the real meltdown, and maybe just enough to let them pretend they're prosecuting financial crime.
According to William K. Black, a major figure in unraveling the S&L crisis, the lack of convictions in the bank meltdown is very suspicious:
INTERVIEWER: You have written and spoken a lot on the topic of the fraud and lawlessness that led to the S&L crisis and the current financial crisis. What do you say to those who suggest that the current crisis is not so much about out-and-out fraud -- such as in the S&L crisis -- as it was about people “gaming the system”?
BLACK: Oh no, is precisely parallel to S&L crisis. The way that they gamed the system was through accounting fraud. In the financial sector, accounting is the weapon of choice. And accounting fraud when you are a publicly traded firm -- and these were all publically traded firms -- is a felony.
In the S&L crisis there were over 1,000 priority case convictions, those were senior insiders, and most of those folks actually did prison time. The huge difference between then and now is that back then, regulators were pushing for criminal convictions. They were providing enormous resources to Department of Justice and the FBI, and they were demanding that they take action. That is what produced the successful convictions along with some very good FBI agents and prosecutors.
easy and unimaginable wealth through financial fraud
The bailout should be financed with steep fines on the Wall St. traders and bankers, whose every transaction should be perused for illegality. Every infraction should be prosecuted, and the perpetrators given a choice of long jail sentences or millions in fines for each and every unlawful act. The government did not do this during the S & L failures and is not doing it with the failure of the entire finance industry because it has also been corrupted by the easy and unimaginable wealth financial fraud generates.
Beyond Black's well founded
Beyond Black's well founded suspicions (few other people have as much experience with this as him) there's the simple fact that not closing down insolvent "TBTF" banks is a violation of federal law.
WILLIAM K. BLACK: Well, certainly in the financial sphere, I am. I think, first, the policies are substantively bad. Second, I think they completely lack integrity. Third, they violate the rule of law. This is being done just like Secretary Paulson did it. In violation of the law. We adopted a law after the Savings and Loan crisis, called the Prompt Corrective Action Law. And it requires them to close these institutions. And they're refusing to obey the law.
BILL MOYERS: In other words, they could have closed these banks without nationalizing them?
WILLIAM K. BLACK: Well, you do a receivership. No one -- Ronald Reagan did receiverships. Nobody called it nationalization.
BILL MOYERS: And that's a law?
WILLIAM K. BLACK: That's the law.
BILL MOYERS: So, Paulson could have done this? Geithner could do this?
WILLIAM K. BLACK: Not could. Was mandated-
BILL MOYERS: By the law.
WILLIAM K. BLACK: By the law.
Just because your paranoid
He turned down overly paranoid billion dollar businesses? What an immoral thing to do! The right thing to do would be to look for days of big swings in stock prices and people cashing in stock bonuses. Then you "find" lots of bug in their offices and say they must have been there at least months before the suspicious trades... and watch them running for the shredders ;-)
Just because your paranoid doesn`t mean you don`t deserve people out to get you.