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Here We Go Again: Goldman Subpoenaed

Tyler Durden's picture




 

2010. All over again:

  • GOLDMAN SACHS SAID TO GET SUBPOENA FROM MANHATTAN PROSECUTOR
  • VANCE SAID TO SUBPOENA GOLDMAN SACHS OVER LEVIN PANEL REPORT

From Bloomberg:

“We don’t comment on specific regulatory or legal issues,
but subpoenas are a normal part of the information request
process and, of course, when we receive them we cooperate
fully,” said David Wells, a company spokesman.

The request relates to the U.S. Senate’s Permanent
Subcommittee on Investigations report on Wall Street’s role in
the housing market collapse, which accused New York-based
Goldman Sachs of misleading buyers of mortgage-linked
investments, the people said. That report was referred to the
U.S. Department of Justice and the Securities and Exchange
Commission, which are also investigating.

A message left for Erin Duggan, chief spokeswoman for
Manhattan District Attorney Cyrus Vance Jr., wasn’t immediately
returned.

A subpoena is a request for information and doesn’t mean
the company is a target of a criminal investigation. Analysts
including Sanford C. Bernstein’s Brad Hintz have said they don’t
expect the firm to be criminally prosecuted.

 

And as a reminder here is why Brad Hintz hopes that should his research ever bring down Bernstein, that the firm will also be TBTProsecute:

“If an alleged violation is identified during a Goldman investigation, we expect a reasoned response from the Justice Department,” Hintz wrote. “In a worst case environment, we would expect a ‘too big to fail’ bank such as Goldman to be offered a deferred-prosecution agreement, pay a significant fine and submit to a federal monitor in lieu of a criminal charge.”

He kept his “outperform” rating on Goldman Sachs. The stock fell $2.32, or 1.6 percent, to $138.41 at 9:55 a.m. in New York Stock Exchange composite trading. Goldman Sachs has declined 16 percent this year through yesterday.

“As politicians continue to criticize the firm and the public scrutiny persists, we believe that Goldman’s clients will begin to rethink their relationship with the firm and the franchise will ultimately suffer,” he wrote. “With approximately 17 percent of the ownership in the hands of current and former partners, this control group has ample motivation to make amends with politicians and the public in order to reduce the threat to its franchise.”

 

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Thu, 06/02/2011 - 09:42 | 1332025 SheepDog-One
SheepDog-One's picture

1 govt again trying to sue the other govt...let's see how it plays out!

Thu, 06/02/2011 - 09:43 | 1332030 johny2
johny2's picture

+1 

Thu, 06/02/2011 - 09:48 | 1332042 DeadFred
DeadFred's picture

Last time this happened two just before the top but this time a day after it tanks. Is this evidence Goldman is now frontrunning the legal system?

Thu, 06/02/2011 - 10:21 | 1332123 Careless Whisper
Careless Whisper's picture

the story reads so much better with this music playing in the background.

http://www.youtube.com/watch?v=aTVSTnYIxEA

 

btw the phrase  "dead on the money" means bullseye

 

Thu, 06/02/2011 - 09:39 | 1332026 DavidC
DavidC's picture

You have to admit though, Tyler, that it makes very entertaining viewing, in a perverse way, watching the Goldman boys with their obvious lies on CSpan.

DavidC

Thu, 06/02/2011 - 09:43 | 1332031 augie
augie's picture

I must say, express has come a long way in their suit construction.

Thu, 06/02/2011 - 09:41 | 1332035 youngman
youngman's picture

another 50 Million penalty...or fine...ooops I mean settlement for a trillion dollar crime...alll is good in squidland

Thu, 06/02/2011 - 11:51 | 1332521 Harlequin001
Harlequin001's picture

The Fed hasn't spent the last three years stuffing this company with money through one sided bond trades to have some legal bod take it out over some mere legal matter...

$50 million is ample compensation for mere criminal activity when the survival of the entire western financial system is at stake.

These guys are patriots for christs' sake...

 

Thu, 06/02/2011 - 09:41 | 1332036 John McCloy
John McCloy's picture

Perhaps that was the true reason for yesterday's sell off. Wall St throwing a warning tantrum either over the theater debt ceiling vote or the GS subpeona. We all know it was not the ADP report since data is always ignored.

Thu, 06/02/2011 - 09:53 | 1332065 augie
augie's picture

I dont go to see the pictures anymore, the theater being played out right now in politics and business is far more entertaining than any jerry bruckhimmer production i've ever seen. Maybe not david lynch status yet, but give it time.

Thu, 06/02/2011 - 09:42 | 1332039 espirit
espirit's picture

Well brag about their commodities spec trades in this mornings WSJ, and see where that leads.

Next- JPMC, HSBC, et al.

Thu, 06/02/2011 - 09:43 | 1332040 Vincent Vega
Vincent Vega's picture

Which is the dog and which is the pony?

Thu, 06/02/2011 - 09:48 | 1332045 Temporalist
Temporalist's picture

Goldman down 3.5% after subpoena report. -Bloomberg

Thu, 06/02/2011 - 09:45 | 1332047 libertus
libertus's picture

Could it be that various factions in the government are starting to fight among themselves? As the government collapses, the numbers of groups fighting for the leftovers will be epic. Goldman may find itself isolated as more groups defect from their camp to save themselves. All is not sunshine, lollypops and rainbows in Washington. They know the jig is up. 

Thu, 06/02/2011 - 10:22 | 1332146 Alienated Serf
Alienated Serf's picture

states and feds always fight.  who do you think shut down spitzer for messing too much ith wall street.

Thu, 06/02/2011 - 09:49 | 1332050 rayban
rayban's picture

Wasn't a similar GS legal event the trigger that started thethe April 2010 sell-off, and eventually led to the flash-crash? GS stock reaction today very important.

Thu, 06/02/2011 - 09:47 | 1332054 silvertrain
silvertrain's picture

Flash Crash imminent..

Thu, 06/02/2011 - 09:50 | 1332055 GeneMarchbanks
GeneMarchbanks's picture

I've seen this show- great title, amazing preview and a plot that goes nowhere!

Thu, 06/02/2011 - 10:13 | 1332130 citrine
citrine's picture

+1

Thu, 06/02/2011 - 09:51 | 1332058 Dr. Engali
Dr. Engali's picture

Die squid die. My put options are looking pretty good right now.

Thu, 06/02/2011 - 09:56 | 1332075 augie
augie's picture

i'm in the same boat, i have 10X jun 11' 1310, 10X jul 11' 1180, and 50X dec 11' 600

if you dont mind me asking, what is your target? i'm looking for an exit on my jun/jul puts. Nice to know what other like-minded-individuals are thinking.

 

Thu, 06/02/2011 - 10:04 | 1332101 Dr. Engali
Dr. Engali's picture

Well my puts are on squiddy. I just exited my GS Jun 2011 135.000 put. I still have 100xGS Jan 2012 65.000 put.

Thu, 06/02/2011 - 10:05 | 1332113 augie
augie's picture

lol I find it amusing how most of us have exactly the same understanding of where this market is ultimately headed. Good luck fighting the squid, this subpoena news must be music to your ears.

Thu, 06/02/2011 - 10:10 | 1332122 Dr. Engali
Dr. Engali's picture

I love it and to see the squid squirm is an extra added bonus. About 2 weeks ago somebody opened up 4000 december 2012  65.00 puts. I'm just following the money.

Thu, 06/02/2011 - 09:52 | 1332060 somethingelse
somethingelse's picture

We need a 21st century Eliot Ness to really go after GS "untouchables" full bore

Thu, 06/02/2011 - 10:03 | 1332097 augie
augie's picture

Eliot ness? you need Ned Land!

http://www.youtube.com/watch?v=LNR-TKzHct4

Thu, 06/02/2011 - 10:12 | 1332120 Problem Is
Problem Is's picture

Oh but you have it! In the form of Cyrus Vance Jr. son of the One-Term-Carter administration douche-bag...

The more things change... the more elite relatives fail upwards in a crony capitalist system...

How else do you explain Shrub Jr. and the Senator's son Douche-Bag Dodd??

Thu, 06/02/2011 - 09:54 | 1332068 Temporalist
Temporalist's picture

I like the clip that Bloomberg chose to use of Blankfein in front of the investigation committee with the hecklers in the background dressed as inmates in their Prison Stripes.

Thu, 06/02/2011 - 09:57 | 1332077 White.Star.Line
White.Star.Line's picture

Another staged "rooting out corruption" investigation that will produce nothing other than fog, smoke, and mirrors.
If we were truly eliminating corruption in this country, the financial district in New York would end up looking like a ghost town, and government offices in Washington emptied and abandoned.

Thu, 06/02/2011 - 10:11 | 1332124 Problem Is
Problem Is's picture

+5... Excellent analysis... with ghost town analogy!

Thu, 06/02/2011 - 11:12 | 1332341 augie
augie's picture

Did someone say ghost town!?!!

 

http://www.youtube.com/watch?v=HpYyqaSYLyw

Thu, 06/02/2011 - 09:58 | 1332080 TopOnePercent
TopOnePercent's picture

Nothing is going to change until the market structure itself changes.

 

Glass Steagall, amongst other much needed restrictions.

 

Otherwise, some old names will be taken out just to be immediately replaced with the same ilk after paying a few small fines.

 

Thu, 06/02/2011 - 09:57 | 1332086 lizzy36
lizzy36's picture

And by the close a settlement will be announced.

Futures will be pumped into a horrific NFP report, as clearly all is going well in the financial system once again.

Thu, 06/02/2011 - 10:31 | 1332177 Dollar Bill Hiccup
Dollar Bill Hiccup's picture

A settlement? Don't be so naive. They will not be tempted by the Government.

Lloyd is out in the desert as we speak, sitting under a tree. He's hungry, he's cold and he just started. After forty days and forty nights, this will all disappear and an angelic choir will sing his praises.

No one said it's easy doing the Almighty's work Lloyd, but you are just the man for the job.

Thu, 06/02/2011 - 09:57 | 1332087 labrat
labrat's picture

Clever, real clever.

Let's see, instead of announcing this yesterday around 4:15 or later today, they pick mid-morning of a trading day.

That caused a sizeable and highly predictable move in various currencies and indices... I wonder if they they notified Goldman in advance.

Also, I wonder how much Levin and the Manhattan Prosecutor's Office made on the trade they placed just before the announcement.

Real clever fellas!

Thu, 06/02/2011 - 10:06 | 1332091 Problem Is
Problem Is's picture

From: CREEP
Committee to Re-Elect the President
1600 Pennsylvania Avenue, NW
Washington, DC 20500

 

To: Lloyd "Doing God's Work" Blankfein
CEO Goldman Sachs
200 West Street
New York, NY 10001

Dear Lloyd,

Time to pony up and renew your campaign bribe commitments for 2012.

Much Love, David Axelrod

Thu, 06/02/2011 - 09:59 | 1332092 labrat
labrat's picture

Uh... wait a minute.  Maybe Levin and the Prosecutor's Office just let Goldman place the trade for them, and they're taking a cut!

Thu, 06/02/2011 - 09:59 | 1332096 realitybiter
realitybiter's picture

The gubmint = The Mad Regulating Fury.....I'm thinking a red hood, red cape, and lightening bolt across the chest, through a ginormous G

 

Goldie = Evil Dr Dough....a green outfit, of course, with dollar signs everywhere

Oh, lets get back to the match!  They are coming out together from the same locker room....

 

ding, ding, ding.....and in this corner....

 

 

Thu, 06/02/2011 - 10:09 | 1332115 bhakta
bhakta's picture

Well if the Dept of Justice charges GS criminally, as they deserve, I think that will be the day we all rise from dead and ascend to heave.

Thu, 06/02/2011 - 12:26 | 1332685 aheady
aheady's picture

Already heaving, thank you.

Thu, 06/02/2011 - 10:12 | 1332121 slaughterer
slaughterer's picture

GS sold off the market yesterday to gather funds to short their own stock.  Easy as that. /sarc

Thu, 06/02/2011 - 10:26 | 1332168 espirit
espirit's picture

+1... No doubt!

Thu, 06/02/2011 - 10:23 | 1332161 I am a Man I am...
I am a Man I am Forty's picture

how does Hintz's outperform rating jive with that last paragraph, this guy is either a liar or a dipshit, and more than likely both

Thu, 06/02/2011 - 10:37 | 1332210 AldoHux_IV
AldoHux_IV's picture

TBTProsecute is absolute horse shit-- these bankster assholes think they commit economic genocide and also be above the law?  The hubris on these scumsuckers.

Thu, 06/02/2011 - 10:38 | 1332217 Alienated Serf
Alienated Serf's picture

1. manhattan DA is elected, there is some populist incentive (yes, even in NYC) to go after them.

2.  NY gov has always resented fed intrusion/total take over of financial biz it its backyard.  they want nothing more to exert power and be relevant.  don't under estimate how much they want to prove they can pick up where there feds have failed/aided abbeted the banks.

3. NY politics are much more dependant on public employees, welfare recipients and  pissed off people who see the bankers in person then big national party money.  It is good politics to go after them.

again, the feds will do all they can to thrwart this.

 

Thu, 06/02/2011 - 12:12 | 1332620 MIDTOWN
MIDTOWN's picture

Convictions, if any should arrive just in time for a presidential pardon.

Thu, 06/02/2011 - 10:44 | 1332237 buzzsaw99
buzzsaw99's picture

Again AG Holder at the DOJ is a great big pussy.

Thu, 06/02/2011 - 13:45 | 1333065 NotApplicable
NotApplicable's picture

Make that VAG holder.

Thu, 06/02/2011 - 10:43 | 1332239 Atomizer
Atomizer's picture

Oldy but classic..

Daily Show: These F@#king Guys - Goldman Sachs

http://www.thedailyshow.com/watch/mon-april-19-2010/these-f--king-guys---goldman-sachs

 

Thu, 06/02/2011 - 10:49 | 1332253 equity_momo
equity_momo's picture

Goldman isnt TBTF. I wish these industry scumbags would stop perpetuating that myth.

Thu, 06/02/2011 - 10:51 | 1332262 dark pools of soros
dark pools of soros's picture

a guy named Levin suing Goldman??  why not just make a musical? It would be less theatric

Thu, 06/02/2011 - 11:01 | 1332302 equity_momo
equity_momo's picture

Yeah hes just following orders though , you know, like Soros did in WW2.

Thu, 06/02/2011 - 11:10 | 1332325 traderjoe100
traderjoe100's picture

My neighbor a small state district attorney is thinking of sueing Goldman, because, hell, if they can pay off Congress they can afford a small state district attorney - ought to be good for a few hundred thou...

Thu, 06/02/2011 - 11:19 | 1332368 Alienated Serf
Alienated Serf's picture

locals are our only hope

Thu, 06/02/2011 - 11:17 | 1332348 williambanzai7
williambanzai7's picture

It is slightly more than ironic that the spokesmans name is Wells, as in Wells Notice.

Thu, 06/02/2011 - 11:22 | 1332387 Alienated Serf
Alienated Serf's picture

GS was fined 200k for not disclosing the levin investigation in a wells notice.  that taught them!

Thu, 06/02/2011 - 12:12 | 1332530 riley martini
riley martini's picture

  Manhattan New York DA Snider has voved to go after the fraudsters in banking that has left the reputation of New York Banking lower than than of a Nigerian lottery winner . RT did a piece yesterday. Or maybe Snider is just looking to shake down the crooks to run for higher office.

Thu, 06/02/2011 - 11:52 | 1332535 nathan1234
nathan1234's picture

By the time any action is taken the financial crisis will be in full swing and Goldman would be broke anyway. Individualy the Goldman bankers would be rich men with their assets in gold and silver.

Thu, 06/02/2011 - 12:08 | 1332602 tip e. canoe
tip e. canoe's picture

IF a shark must be sacrificed in order to save the System, it makes sense that GoldSacks will be 1st in line to the altar.   why?   no retail branches.   imagine the CRE hit if BoA or Citi has to start closing branches all across the country.   the Morgue & Wells were very smart in getting their claws into all these neighborhoods over the past 3 years.   Blankenfein's fatal flaw may be that he thought him and his boys too good for the same.

Thu, 06/02/2011 - 13:59 | 1333162 NotApplicable
NotApplicable's picture

Good point. Besides, I'm sure the principals have hollowed that sucker out so completely that there won't even be anything left to salvage for the bag-holders. Then they will coalesce in some other entity (like say, the Morgue) and pick up right where they left off.

Thu, 06/02/2011 - 14:18 | 1333249 PulauHantu29
PulauHantu29's picture

But...but...they're only doing "God's work" the Blankfeinman said.

Thu, 06/02/2011 - 14:35 | 1333353 mfoste1
mfoste1's picture

didnt the market crash right after they did this last year?duh....winning

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