Posted on 04/16/2010 7:43:50 PM PDT by NormsRevenge
Paulson does not appear as a defendant in the SEC’s lawsuit, which hones in on whether Goldman Sachs (GS, Fortune 500) disclosed conflicts of interest. But if the allegations in the suit are true, then Paulson had inside, perhaps non-public, and very material knowledge about a security that made him money — and lost Goldman clients $1 billion.
“Paulson’s fund is a private entity and his records are not public, which is probably why you haven’t seen charges brought against him,” says Keith Springer, president of Capital Financial Advisory Services. “The government may still be gathering information, but I can’t imagine them not going after him.”
In light of today’s SEC’s allegations, it seems inevitable that questions will arise regarding whether Paulson was manipulating the subprime market for his hedge fund’s gain, and what lengths he went to in order to make sure his big bet against the American economy came up a winner.
http://money.cnn.com/2010/04/16/news/companies/SEC_goldman_paulson.fortune/index.htm
He was buying everyone off. And Goldman got quite a bang in bail out bucks! Generations of debt for Americans. I wish we had representatives as good as Goldman does.
“corporatist “
Ron Paul is that you? Marxists like people with money. They are part of the elite and not the masses.
Protection money...
The billionaire hedge fund manager at the center of an alleged fraud hatched at Goldman Sachs, a leading investment bank, has given tens of thousands of dollars to both parties. Campaign fundraising records show that John A. Paulson, founder and chairman of the hedge fund Paulson & Co., gave $30,400 to the Democratic Senatorial Campaign Committee in June, qualifying him as a major Democratic donor. He also gave $2,300 to Senate Majority Leader Harry Reid's (D-Nev.) reelection campaign in February of last year and $4,800 to Senate Banking Committee Chairman Chris Dodd (D-Conn.) last April, according to records filed at the Federal Election Commission... Paulson's support of Democrats, however, may give Republicans ammunition when Democrats bring their financial regulatory reform bill to the Senate floor next week, as planned... The SEC alleged that Paulson & Co. participated in a scheme in which Goldman sold subprime residential mortgage-backed securities to investors, such as foreign banks and pension funds, that were expected to lose value. Paulson & Co. bet heavily against the value of the fund, named Abacus 2007-AC1, which included mortgage bonds it viewed as overvalued, earning millions at the expense of Goldman clients who invested in it... Goldman earned between $15 million and $20 million to create and market the fund to investors who did not know that Paulson helped select its holdings and then bet it would lose value, according to the SEC. Reid seized on the allegations to argue that the Senate should pass a Democratic Wall Street reform bill... "We will stop banks from becoming 'too big to fail' and end taxpayer bailouts," Reid said... Paulson gave thousands to other senior Senate Democrats in previous election cycles. He gave $4,600 to Sen. Carl Levin (D-Mich.) and $4,600 to Sen. Max Baucus (D-Mont.) in 2008, according to FEC records. Paulson... gave $2,300 to Rudy Giuliani's presidential campaign and $2,300 to Mitt Romney's presidential campaign[s] in 2007. He gave $5,000 to House Republican Whip Eric Cantor's (R-Va.) leadership PAC in 2009 and a $1,000 contribution to Republican Rep. Virginia Foxx (N.C.) in 2008.Thanks NormsRevenge.
My question to Reid and every pol accepting huge sums of money from individuals involved in financial fraud:
How can we trust them to write anti fraud legislation that will hurt their biggest donors?
Isn’t it more likely this legislation will encumber honest financiers and provide cover for the frauds driving 18 wheelers through loopholes in the law?
“Once the bets are made they want a return on their investment.”
Well, they sure got it when Paulson was working “for” President Bush. It is also interesting to note the as of 0/3/07, the CEO of GS had a $37 million salary. On 4/30/08 as the market was tanking his salary was upped to $74 million. That spring 43% of the stockholders voted for a Proposal that stockholders have an advisory vote on executive compensation. At that time the top 3 GS people were all paid more than $65 million. And this does not include stock options and other perks. This may have made them a little nervous, because on 4/22/09 the CEO salary was only $26 million. Cant’t wait to see what this spring’s info is.
SOURCE: Google “Forbes CEO Compensation” for the above dates. Look at a lot of the CEO salaries, both the financials, insurance, and health related. Gives one a much better idea of what all the fusses are about.
Check out my Comment #27 for more interesting Goldman Sacks fact.
Folk, we have a
W I N N E R !!!!!!!!
No problemo... Holder will stop the process as soon as he gets another fat dem “donation.”
No orange jumpsuits here. These are civil charges from the SEC.
Don’t forget this...
The U.S. Securities and Exchange Commission hired Adam Storch, a 29-year-old former employee in Goldman Sachs Group Inc.’s business intelligence unit, as the enforcement division ...
www.nydailynews.com/.../10/16/2009-10-
Also, buzz from Zerohedge..
Goldman sold 1,000 big SP today over 1,200.00. Was it just a hedge because they KNEW the SEC would do nail them to the cross? Is that insider trading? Who knows how many tens of thousands they sold in the ES?
(GS knew this was coming for a while. How much money did they make off of the actions of the SEC??)
Filing this [and your post 3] in ...
Obama-nomics link-list
http://www.freerepublic.com/focus/chat/2464021/posts
Lots of Goldman Sachs research at the bottom of the thread, strangely it was right before the investigation. G. Sachs is one of the sleaziest firms we ever had. FRegards ....
His “political investment strategy” could use a bit of re-tooling.
Just so there is no confusion - John A. Paulson, the hedge fund manager, who is the central figure in the article, is not the same person as former CEO of GS Henry “Hank” Paulson that was working “for” President Bush.
To be precise, the SEC lawsuit against GS is for "fraudulent misrepresention" in the marketing of the nature and potential liabilities or problems with Abacus 2007 AC-1 $1B CDO. Paulson was not and could not be charged because he was not marketing and "misrepresenting" AC-1 CDO.
As a matter of fact, John Paulson - who was one of the pioneer of using Credit Default Swaps "insurance" instruments for synthetic shorting of other financial instruments (like CDOs, MBSs, SIVs) and financial firms that bought them - was buying cheap puts in the form of CDSs on these CDOs and paid GS $15M for structuring and marketing Abacus 2007 AC-1 CDO.
From SEC: "Goldman wrongly permitted a client that was betting against the mortgage market to heavily influence which mortgage securities to include in an investment portfolio while telling other investors that the securities were selected by an independent, objective third party."
The SEC lawsuit itself, though, is very iffy. This particular Goldman's CDO was a private placement, not registered offering, so the buyers were all pretty sophisticated institutional investors and funds, not naïve retail investors.
"This case didn't come as a surprise to Goldman. Presumably, Goldman believes that its defense is strong or they would have settled with the SEC," wrote Brad Hintz, brokerage analyst at Sanford C. Bernstein, in a client note Friday.
The real reason Goldman Sachs was hit with this SEC nuisance / publicity lawsuit is that Obama and Dems in the Senate are hoping to use the Republicans' and conservatives' intense dislike of Goldman Sachs and get them on board to push through [tougher] Finance Reform bill.
Of course, just like ObamaCare doesn't even attempt to deal with and contain rising medical costs, Obama's Finance Reform has nothing to do and doesn't deal with the sources of real estate bust and consequent financial crisis - insane Community Reinvestment Act (CRA) laws and de facto mortgage market regulators, government-owned Fannie, Freddie and FHA, which between them now own or control 9 out of 10 mortgages in U.S.
SEC lawsuit is just a red herring to make Financial reform possible or "tougher" than it othwerwise may be.
Say it ain’t so, Joe! Say it ain’t so....
Well yeah!!!! The list went across the scroller on Fox last night, 40K to the DNC, a ton of money to Schumer and Dodds and Obama..
The only thing that surprises me is that this is news, I looked this info up back in the run-up to the vote for stimulus and I never did trust Hank Paulson, plus anyone paying attention new all bailout roads led money-wise right back to Goldman Sacs....
Thanks CP.
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