Those "Too Big To Stay In Jail" Walk: The "GE Three" Go Free

Tyler Durden's picture

From Jonathan Weil, originally posted in Bloomberg

The "GE Three" Go Free

It wasn't long after three former General Electric Co. executives were convicted of rigging auctions for municipal-bond investment contracts that they received the ultimate sendoff: A 7,400-word torching in Rolling Stone magazine by Matt Taibbi, the writer who branded Goldman Sachs Group Inc. with the nickname "vampire squid."

"Someday, it will go down in history as the first trial of the modern American mafia," Taibbi began his June 2012 opus about Dominick Carollo, Steven Goldberg and Peter Grimm. "Over 10 years in the making, the case allowed federal prosecutors to make public for the first time the astonishing inner workings of the reigning American crime syndicate, which now operates not out of Little Italy and Las Vegas, but out of Wall Street."

Then came a surprise last week, right before Thanksgiving. A federal judge ordered the men released from prison. An appeals court had reversed their convictions the day before, without explanation. An opinion would be issued "in due course," it said. Bloomberg News ran a short story this week. The rest of the news media barely noticed.

Americans tend to like their crime stories simple: Good guys catching bad guys and sending them to jail. Nuances and complexities can complicate morality tales. The country is still baying for blood after the financial crisis. Folks want the people who they think helped crash the economy locked up and fed bread and water in place of Cristal and lobster.

The case against the former GE bankers is a reminder that high-profile financial-crime cases rarely are cut and dry. Even when prosecutors win, they still might lose later, especially if the defendants can afford top-notch appellate lawyers. Until last week the GE Three were considered criminals. Now they are innocent in the eyes of the law, and we don't even know why yet. It's possible that the government will appeal further and win in the end. A resolution seems far from final.

A reversal like this helps explain why some prosecutors might hesitate to bring difficult white-collar cases to trial. The Justice Department seemed to pull back from pursuing financial-crisis cases after two former Bear Stearns Cos. hedge-fund managers were acquitted of fraud charges in 2009. (One of the jurors said after their trial that she would invest with them if she had the money.) It's easier to rack up wins by going after small fry for simpler crimes.

Carollo, Goldberg and Grimm each had been convicted on multiple counts of conspiracy to commit wire fraud. Prosecutors accused them of paying kickbacks to brokers hired by cities and towns to oversee the bidding on municipal-investment contracts, which local governments use to invest the proceeds from bond sales. Goldberg was sentenced to four years in prison. Carollo and Grimm got three years each.

Although the appeals court hasn't yet explained its decision, the defendants claimed that the statute of limitations had elapsed by the time they were indicted in 2010. They also complained that they hadn't been allowed to finish cross-examining one of the government's key witnesses after he attempted suicide during a break. The government said he couldn't return for further questioning.

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Cast Iron Skillet's picture

That's why the laws should be simple and clear-cut.

gmrpeabody's picture

Corruption by cops, DAs, judges, or an attorney are capital crimes.

Pegasus Muse's picture
This is why we need guillotines to quickly administer justice to financial industry mafiosos.  The scumbags can appeal their case to the Big Guy upstairs …
Jumbotron's picture

This is why the reason for revolution is simple and clear-cut

Sabibaby's picture

I was going through my guns and thought "why not make this a peaceful revolution?"

ZDRuX's picture

Revolutions only reset the clock, they don't fix the underlying problem of a select few that run every facet of your life. You don't have a choice of not being bossed around, you only have a choice of picking your boss.

Until people realize that none of this would have happened was it not for an entity through which this could be done (government), nothing will ever change.

Kirk2NCC1701's picture

Well, it is "Home of the Brave, and The Land of the Free"** 

"Give me your poor, downtrodden" Oligarchs, so they can do what they do best in an unregulated, crony-capitalism of the New Wild West.


** Brave and ballsy enough to Freely rip off the 99.999%.

0b1knob's picture

"one of the government's key witnesses ... attempted suicide during a break"

Like something in the Godfather.  More like he got an offer he couldn't refuse.

NoDebt's picture

That's what I keyed in on, too.  Musta been one heluva trial.

FieldingMellish's picture

Well.... I never expect that... I am shocked. Shocked! Justice = just us.

Ban KKiller's picture

Violent revolution is looking better and better everyday as we, the people, figure that there is no justice anyway so why not burn the whole thing down so the rich can suffer equally? Our "rational" minds are losing to irrational thoughts as we are betrayed by TPTB. When you feel that you have nothing to lose then you want to see others in the same light. The rich have much to fear. 

I don't mean you, you with a few million dollars. I mean the one half of one percent who control Amerika. Is Greenwich fireproof? If you don't address the lawlessness by the rich then you will suffer. Not today....but soon enough. 

Dr. Engali's picture

I don't care what happens, there will never be a revolution. The empire has done a fantastic job of carving up the populace into neat little groups who are constantly arguing with each other while the real criminals do as they please. The best case/worst case scenerio is a violent uncivil war.

NOTaREALmerican's picture

Re:  The empire has done a fantastic job of carving up the populace into neat little groups who are constantly arguing with each other while the real criminals do as they please.

It's actually, really, survival of the fittest.

The smart-n-savvy people simply do what smart-n-savvy people do: screw the dumbasses.

The dumbasses who have political, religious, moral, economic, ISM, nationalistic, and/or racial OCD are to distracted with their OCD to notice who is screwing them.

So,  in reality, the system is working as the smart-n-savvy people are wealthier, have females with the best teeth, and their DNA bling will inherit the earth.    The OCD people will never figure out how.

Rafferty's picture

It kills me to say, but you're right.

Still doesn't mean we can't set up the guilletines tho'

Metal Minded's picture

"Violent revolution is looking better and better everyday"

And who are you going to fight? You are going to fight yourself! Using violence, you pit yourself against law enforcement and the military, which is made up of people just like you and me, only they are wearing uniforms. The Ownership would love to see you start something like that. The .01% will stand by and profit from the violence, while we fight amongst ourselves.

Violence would only consolidate the Ownership's power at a time when their power has never been weaker.

If your feelings are towards violence, I suggest you spend some time at, an organization of gun owners, law enforcement, and military(active and retired), who are seeking change and restoration of the Constitution.

Dr. Engali's picture

"A reversal like this helps explain why some prosecutors might hesitate to bring difficult white-collar cases to trial."


So hell why don't we just throw up our arms and let them do as they wish? Oh wait......

Crash Overide's picture

What did you expect, John Corzine?

max2205's picture

Campaign contributions really do pay off Virginia. ..nice work Barry.....disgusting

starfcker's picture

Having holder at AG at this juncture is no accident. he is a fixer, not a prosecuter. that's why everything gets fixed, and nobody gets prosecuted. it's just what he does.

Seize Mars's picture

What a fuckin' joke. Jukebox Judge. Put in some $$, you can hear any fuckin' tune you want.

medium giraffe's picture

'attempted suicide'? O Rly?

NoDebt's picture

I have this mental picture of him jabbing himself in the arm over and over with the swizzle-straw from his coffee, shortly after a brief conversation with an unidentifed gentleman in a dark suit.

LawsofPhysics's picture

Why do all the good witnesses get "sucicided"?  When fraud is the status quo, possession is the law.  Roll the guillotines, nothing changes otherwise.

shovelhead's picture

What ever happened to good ol' fire ants and honey?


Everybody is gaget crazy today...


Another old fashioned favorite is a bagful of rats over the head.

AccreditedEYE's picture

Weil, are you F-ing kidding me? "Guts to stand up to the government?" I guarantee you that if this were a blue-collar Union offering kick-backs to get a large government contract and it was exposed, the criminals would face full charges. The double standards in this country continue to smack the populace in the face and their continued response is to just not care.The only way this will change is when these money-diabetics, blinded and bloated by their own short-sightedness, take the whole system down... again. They have to destroy it all and you can safely bet that they will be unable to control themselves which will lead to it happening... again.

shovelhead's picture

You mean like the SEIU...? Illegal activities getting prosecuted?


Funny guy.

Kaiser Sousa's picture

nice selloff at the Crimex close - again...


atomp's picture

What's with the high freq jitters between NY close and open?

curbyourrisk's picture

American Justice is no longer found in the courts.

SDRII's picture

Barrick’s Thornton Weighs Return to Gold Hedging


Munk says his Zambia deal was "hubris"


And the resident FT Shill a month ago whoring the same idea.


...because as a shareholder with your stock down to 2002 levels (-75%  peak) when gold was ~$300 (vs 4x that now), shareholders really want you to hedge. On the other hand the new CEO...

alien-IQ's picture

I'll bet they wouldn't have had their verdict overturned if they were minimum wage workers who stole $100.


American Justice...what a fuckin joke.

NOTaREALmerican's picture

Good thing the law still applies to "those people" tho, or they'd have all our females now.

HamRove's picture

Justice for the plebs will only be found in grass roots Citizen Grand Juries.

We the people want justice. Become a juror or a county organizer and help get this lawless mass a S--t under control.

...Just sayin

Uncle Remus's picture

A stout rope and a sturdy tree.

Dugald's picture

A stout rope and a sturdy tree.

One sturdy missing......the people with the will and the heart to do it......but all you ever hear are people bumming their chat!

jimmytorpedo's picture

4 horses and 4 ropes is MUCH more dynamic.

Even more so if your slice them up the abdomen first.

Apart from the twitching and trickle of piss, hangings are pretty boring.

alibi's picture

two words:



starman's picture

welcome to the dark ages , yes again 

JR's picture

It’s the fine print; it’s the bending of the law and the use of regulations to override freedom and equality under the law.

“This,” said Oliver Wendell Holmes, Jr., “is a court of law, young man, not a court of justice.”

The manipulation of the laws and the courts give the tyrants the upper hand over the people, and with the international bankers sitting at the seat of government the law is used against the people.

From Ambrose Bierce (The Devil’s Dictionary):

SATAN, n. One of the Creator's lamentable mistakes, repented in sashcloth and axes. Being instated as an archangel, Satan made himself multifariously objectionable and was finally expelled from Heaven. Halfway in his descent he paused, bent his head in thought a moment and at last went back. "There is one favor that I should like to ask," said he.
"Name it."
"Man, I understand, is about to be created. He will need laws."
"What, wretch! you his appointed adversary, charged from the dawn of eternity with hatred of his soul – you ask for the right to make his laws?"
"Pardon; what I have to ask is that he be permitted to make them himself."
It was so ordered.

Bending the law and using judges who make law is exactly the reason why Harry Reid pushed aside the two-thirds filibuster rule with a simple majority on judicial appointments last month. It’s called packing the court so that when Obama’s prejudiced policies reach the courts (except the U.S. Supreme Court) such as the Court of Appeals for the D.C. Circuit, they can be rubber stamped. The latter is the court that’s checked President Obama more than once, and Harry fixed it.

Within seven seconds after the decision, government press releases were on their way showing Obama had nominated more than 30 judges.

IdiocracyIsAlreadyHere's picture

Only problem is that you are making it all about Obomber's nominees.  Bush's nominees were every bit as despicable and had the same, if not greater, disdain for the common people and the Constitution.  The fix has been in for a long time.

JR's picture

The difference in Bush’s case was that the filibuster rule offered some opportunity for opposition to completely partisan candidates.

In Harry Reid’s Senate, Democrats can nominate, approve and install the most radical, hard-left lawmaking judges that exist in the country and no single minority party member can have anything to say about it.

By the way, have you noticed that the tsunami of socialism and executive branch tyranny is at least a thousand percent stronger than any other partisan movement in the last fifty years? Congress can pass a law such as Obamacare but the president unilaterally can change the deadlines, delay some parts of the law, exempt whole classes of Americans from provisions of the law, and redistribute the wealth at will while bragging about it - and no action is taken to stop him.

How dare you compare the mail fisted power grab of this government with the performance of the admittedly non-conservative George Bush. Surely, even though you are a Democrat, you must see that if the abandonment of Constitutional guarantees is not stopped there will be no America.

Or do you even want an America?

OneTinSoldier66's picture

Go ahead. Keep on believing that the ballot box and voting booth is the holy grail of the religion called Government.


I pledge alleginace to the flag, and the government and bankster debt for which it stands.

highwaytoserfdom's picture

JR      Cato minor and Caesar and Republic ended....  


As the great Yogi Berra said  "It's like déjà vu all over again."

madcows's picture

Justice is blind, right.  As in, she is so blind she can't enact any justice at all.

nope-1004's picture

Black prez in a white house making gray laws.


NOTaREALmerican's picture

WTF...    When were the laws written.    At least TRY to make the racism believable.  

madcows's picture

it's tough to get justice when those responsible for enacting it are part of the perpetrators.


JR's picture

Throughout history bankers have been parasites but when got their hands on the top levers of government such as in the City of London they then became controllers of the society.

The New Statesman in the 1980s called the City “an unpatriotic casino which pays itself obscenely high salaries for dancing on the grave of British industry.”

Of course, this was nothing compared to the present day control the banks use through the Federal Reserve to control most all levers not only of American government but of the European Union.

John Dryden, 1682: “They who possess the prince possess the laws.”