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SEC Is Probing Goldman's Excess Variation Margin Demands On AIG
Sooner or later it was bound to happen: the SEC is now looking into whether Goldman's over the top variation margin demands on AIG caused an "improper distress" in the mortgage insurance market (not to mention a couple of competitors' bankruptcies here and there). Not that much will come out of it, you see, since the SEC is woefully underfunded to purchase even one copy of any Janet Tavakoli book... Although the fact that they are finally investigating it should be indicative that if you raise enough stink, even the brain dead Wall Street sycophants at the Syndicate Encouraging Corruption will stop watching pornography for a living and for a few short minutes pretend to push a few papers here and there and actually do their pathetic, anaerobic jobs (and bill taxpayers more than appropriately).
From Reuters:
On a conference call between Goldman and AIG executives early that year, the Wall Street bank wanted the insurer to pay more than the $2 billion it already paid to cover losses Goldman said it might suffer on complex securities, the paper said, citing AIG documents and an audio recording of the call.
AIG executives wanted some of the $2 billion back, saying Goldman had inflated the potential losses, the paper said, adding the call ended with nothing settled.
Then the world's biggest insurer, AIG insured Goldman's securities. It was bailed out with a $182.3 billion government aid package when the mortgage market-inspired financial crisis struck later in 2008.
Now, the Securities and Exchange Commission is examining whether the demands by banks were improper, the paper reported, citing people briefed on the matter.
"This is the New York Times' third attempt to develop a conspiracy theory about Goldman Sachs and AIG," Goldman spokesman Lucas van Praag said in an email. "The theories are disgracefully contradictory and the 'facts' don't stand up to serious scrutiny."
Way to go Mary. Oh and by the way, did you pay Sergey Aleynikov a few million to shut up yet? Inquiring minds want to know if stealing "market manipulative" secrets from Goldman Sachs is now considered an act of breavery and courage.
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the SEC is now looking into
i imagine it will be a "robust and vigorous" looking into....
Goldman has consistently maintained that they were "fully hedged" either way, regardless of the AIG outcome.
I wish for Mr. Van Praag to actually explain how and maybe even draw it out for some of us "slow on the uptake."
Specically indicate how the $12 billion payout from AIG was hedged?
Patrick
Manipulation? Fraud? Goldman?
nah...
Hopefully Chris Cox is there to set the record straight and maybe burn a few.
Patrick
We are tired of this game!! The SEC couldn't find it's way out of a paper bag--and now they are going to "probe" their Goldman masters??
Seriously--it's just not even funny anymore. This is fraud layered upon fraud, and the regulators have been clearly complicit the whole way!
Bring out the handcuffs already. And start with Mary Shapiro, please.
When is someone actually going to probe the SEC?? You know, the people that were supposed to be doing the probing, that weren't over the last 8 years??
Bernie Madoff was just the appetizer--
They might want to look at the blood funnel GS had into Soc Gen..sounds like another back door deal.
Goldman porn!
Holy Crap! Mary got the email.
Given the SEC's track record fighting fraud and what seems to be a complete reluctance to vigorously investigate Goldman Sachs I doubt this will amount to anything. That whole agency needs to be revamped and every senior level manager there should be replaced by people with a true belief in fighting fraud in the markets.
Could you imagine what Eliot Spitzer could do with $1 billion and the ability to choose his own senior staff.
Unfortunately, it could take a year or more just to revamp the staff.
We are living in a totally different reality, though.
SEC hear no evil see no evil. toothless.. part of the problem ...
if any one is holding their breath for some sort of justice .. you may expire lol
http://www.sec.gov/news/press/2009/2009-220.htm
Adam Storch Named Managing Executive of SEC’s Enforcement DivisionMr. Storch joins the SEC from Goldman Sachs & Co., where he was Vice President in the Business Intelligence Group.
Chief Operating Office, not Managing Executive. It's an admin role (a senior one), Nothing sinister about it.
nothing sinister? you know this how? is he a whistle blower? if not why is this not just more of the same? let's get someone in enforcement, if not from outside wall street, at least from another firm for a change.
Mr. Storch will supervise the Office of Market Intelligence, improving the collection, analysis, risk-weighing, triage, referral, and monitoring of the hundreds of thousands of tips, complaints and referrals that the agency receives each year.
Any relationship to Corporal Agarn of F-Troop?
Who exactly would be in charge of investigating the SEC? Does Goldman have a department that can be contracted for that kind of work?
There are a couple of ex GM Presidents available and one (Henderson) is a somewhat combative financial guy.
The only problem is that Henderson would think he was actually supposed to do the job. The political hacks that would do the appointing probablby wouldn't want that.
The SEC another taxpayer funded agency purposely not doing their job .
Tyler
I love you. When I get rich I am going to pay to fly you and Marla first-class to Sydney so that you can appropriately elucidate the ASIC here - our Aus Syndicate Inveigling Corruption - who regularly fornicates Macquarie Bank, our own little homegrown Goldman Sachs wannabe.
I will seriously pay for both of you plus your servants, spouses, nannies, and concubines to stay in the penthouses of your choice, with Sydney Harbour views, to do this. For years if that's what it takes.
When I get rich. I promise. We are in dire need of gifted prophets in the wilderness, and I can only aspire!
Ditto,
When I get rich, I am going to fly you guys out to Denver CO to see my medical plantation. I need some additional investors if anybody wants "in."
Patrick the Painter
On Macquarie Bank (They call themselves the Millionaire Factory.) If their prop desk is not propping up their share price, they are watching porn. Look where they got caught on national TV. (Very funny.) http://www.youtube.com/watch?v=E8wPRGw2jrE
SEC would never bite the hands that feed it....
An occasional small name well publicized now and then....
Lets the public know that they are omnicient....
FO
Just ask Arthur Levitt ...the ex head of the SEC....
Currently this guy runs GS PR on Bloomberg....Is paid by the SEC....Bloomberg...and GS....
And this is just one of them....
By the way ....what colr is a white horse ?
Can anyone see the elephant in the 10X10 room ?
By the way....has anyone noticed that the SEC generally prosecutes only those small fish where there are no future employment prospects ?
TYLER / BOOK LIST (A thought for the ZH readership) ???
You mention Janet Tavakoli's book above. Question or idea for you and your staff...
Would you be willing you post an article or thread maybe called "Books to Read" that you and staff, as well as many within the ZH readership, could also ADD to this list, a great LIST of BOOKS (like Janet's) that we could recommend to each other and ZH readership to READ ???
Thanks TYLER for your consideration...
SEC probe? LOL What they gonna do, slap them on the wrist, give them a 500k fine and say don't do that again LOL They stole billions and will get off the hook. If I can steal 13 billion dollars and only have to pay 500k in fines, what do you think I am gonna do next time? The regulators we have are clueless. I guess the porn websites keep them busy these days.
anaerobic lol