Rolling Stone Magazine: Eric Holder Has ‘No Balls’
WASHINGTON (CBSDC/AP) — Rolling Stone magazine has called out Attorney General Eric Holder for not pursuing criminal charges against Wall Street firm Goldman Sachs.
In an article entitled “Goldman Non-Prosecution: AG Eric Holder Has No Balls,” writer Matt Taibbi accuses Holder of not going after “smart criminals.”
“[I]t wasn’t surprising that Holder didn’t pursue criminal charges against Goldman. And that’s not just because Holder has repeatedly proven himself to be a spineless bureaucrat and obsequious political creature masquerading as a cop, and not just because rumors continue to circulate that the Obama administration – supposedly in the interests of staving off market panic – made a conscious decision sometime in early 2009 to give all of Wall Street a pass on pre-crisis offenses,” Taibbi said.
He later added: “Holder’s non-decision on Goldman is more than unsurprising. It amounts to an official announcement that the government is no longer in the business or prosecuting smart criminals. It’s pathetic. The one thing you pay any lawyer to have is balls, and our nation’s top attorney has none.”
The Justice Department announced last week it wasn’t prosecuting Goldman Sachs or its employees in a financial fraud probe.
In a written statement, the department said it conducted an exhaustive investigation of allegations brought to light by a Senate panel investigating the 2008-2009 financial crisis.
But the department added that if additional or new evidence were to emerge, it could reach a different conclusion about prosecuting Goldman.
A Senate subcommittee chaired by Sen. Carl Levin, D-Mich., in April 2011 found that Goldman marketed four sets of complex mortgage securities to banks and other investors but that the firm failed to tell clients that the securities were very risky. The Senate panel said Goldman secretly bet against the investors’ positions and deceived the investors about its own positions to shift risk from its balance sheet to theirs.
The Senate panel probe turned up company emails showing Goldman employees deriding complex mortgage securities sold to banks and other investors as “junk” and “crap.”
Levin said during his subcommittee’s investigation that he believed that Goldman executives “misled the Congress” and that Goldman “gained at the expense of their clients and they used abusive practices to do it.”
Levin questioned the accuracy of testimony Goldman Sachs executives gave to Congress about whether the firm steered investors toward mortgage securities it knew likely would fail.
Goldman CEO Lloyd Blankfein told the Senate panel that the company didn’t bet against its clients and couldn’t survive without their trust. The company lost $1.2 billion in the mortgage meltdown in 2007 and 2008 that touched off the financial crisis and the worst recession since the 1930s, Blankfein testified. He also insisted that Goldman wasn’t making an aggressive negative bet – or short sale – on the mortgage market’s slide.
In 2010, Goldman agreed to pay $550 million to settle civil fraud charges by the SEC of misleading buyers of mortgage-related securities. The agreement applied to one of the four deals cited by the Senate subcommittee.
The Justice Department said it would aggressively pursue investigations of “matters affecting our financial system.” The department pointed to its probe into the manipulation of the London Interbank Offered Rate. Britain’s Barclays bank admitted in June that it had submitted false information to keep the rate low. Barclays was fined $453 million in settlements with the Justice Department, the U.S. Commodity Futures Trading Commission and British regulators.
LIBOR, as it is known, is the interest rate that banks charge each other for short-term loans. It is used as the benchmark for bank rates all over the world.
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