Goldman's Dan "Shitty Deal" Sparks Sued For Selling “Junk,” “Dogs,” “Big old lemons,” and “Monstrosities”

Tyler Durden's picture

While the FHFA has targeted lawsuits at a whole bunch of employees of the 17 banks previously disclosed, nothing gives us as much amusement and frankly pleasure, as the fact that Goldman's definition of smugness - one Dan Sparks of "shitty deal" fame, is among the accused. Perhaps, even in uber crony communist America, what goes around eventually comes around. Now, if only someone can figure out how Warren Buffett's Wells Fargo, with its several hundred billion worth of Wachovia toxic biohazard, is not on the list of defendants...

As a reminder:

And some blurbs on Dan Sparks from the filing:

On March 9, 2007, Goldman’s Daniel Sparks wrote: “Our current largest needs are to execute and sell our new issues—CDO’s and RMBS—and to sell our other cash trading positions .... I can’t overstate the importance to the business of selling these positions and new issues.” A leading structured finance expert reportedly called Goldman’s practice “the most cynical use of credit information that I have ever seen,” and compared it to “buying fire insurance on someone else’s house and then committing arson.” Senate PSI Hearing Ex. 4/27- 76. As the Senate PSI found, Goldman “sold RMBS securities to customers at the same time it was shorting the securities and essentially betting that they would lose value.” Senate PSI Report at 513.

 

That Goldman knew of the originators’ abandonment of applicable underwriting guidelines and of the true nature of the mortgage loans it was securitizing is further evidenced by how Goldman handled its own investments. Goldman internally characterized its offerings as “junk,” “dogs,” “big old lemons,” and “monstrosities.” FCIC Report at 235–36. Nevertheless, it congratulated itself for successfully offloading such “junk” onto others. As the public learned in the FCIC’s Report, by January 2007, “Daniel Sparks, the head of Goldman’s mortgage department, extolled Goldman’s success in reducing its subprime inventory, writing that the team had ‘structured like mad and traveled the world, and worked their tails off to make some lemonade from some big old lemons.” Id. at 236.

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iDealMeat's picture

Now, if only someone can figure out how Warren Buffett's Wells Fargo, with its several hundred billion worth of of Wachovia toxic biohazard, is not on the list of defendants...

Just needed to be repeated...

spiral galaxy's picture

Ok.........here goes........."Now, if only someone can figure out how Warren Buffett's Wells Fargo, with its several hundred billion worth of of Wachovia toxic biohazard, is not on the list of defendants..."

:-)

Actually, can't be repeated enough.  Perhaps the Washington Post or NYT will have something on this?  ......next to the DOJ 'Fast & Furious" coverup article?

ghostfaceinvestah's picture

What about IndyMac?

Oh, yeah, the FDIC owns those liabilities...

Yes_Questions's picture

 

 

Liabilities is such a kind word.

spiral_eyes's picture

I suspect that bigger geopolitical "events" may emerge that prevent any of these cases from being properly prosecuted...

http://azizonomics.com/2011/08/14/pentagon-plans-for-war-with-china/ 

Kayman's picture

That plan is only an extension of the McArthur plan, beginning in 1950.  It ends with nukes.

Atlas_shrugging's picture

I've been wondering for weeks what Obama had over Buffett to get him to act like a hand-puppet and wax on about waxing off rich people...now we know.

crazyjsmith's picture

He had to pay $5 Big ones to buy his protection. Just like anyone who gets shaken down by the mob. You get to play Uncle Warren, also means you get to pay.

New_Meat's picture

meh-$1BB tax lien for $5BB "investment" into BK BAC?  Not Snowballz style.

He likes high "Death-Tax" because it forces rather-more-larger family concerns to sell off vs. liquidation when the princes go off to their reward.

Local example is "Jordan's Furniture" that sold to BRK, got a cash infusion to build a warehouse, and the Broz got to retire in style.

- Ned

Old Poor Richard's picture

Buffet's going roll back the clock, turn the sales fraud spigot back on, and Obama will buy up the truly odious junk that won't sell.

He's hanging onto the drug money laundering operation, though.

chubbar's picture

Yeah, Fast & Furious! Fat chance any newspaper covers THAT story. Holder should be run out of office and face criminal trial with the deaths he has directly caused by his actions, but you won't see that charge being levied anywhere in print. Now the cocksucker in chief is talking about limiting guns that have clips in the "border states" to prevent the fucking loser drug gangs from shooting border agents. See a connection here? The fucking White House funnels guns to the gangs, they shoot the border cops and now the Cocksucker in Chief wants to limit gun types! What a fucking asshole both he and Holder are! Just another attempt to grab our 2nd amendment rights. Fight these assholes and write your senators and congressmen about this flagrant attempt to usurp the constitution!!!!

chindit13's picture

How much securitization did WFC do?  Perhaps they still are holding the lion's share of their bad paper.  I'll have to go back and check the 10-Q's.

oogs66's picture

The only possible explanation, other than the obvious favoritism is that they were too stupid to sell any and own everything they originated?

More likely vanity fair or rolling stone will shed light on this issue than any of the business press

DosZap's picture

< spiral galaxy >@ 18:01,

BINGO!!!, another winner O.T. same principles.................

 

next to the DOJ 'Fast & Furious" coverup article?

Starts at Owhammy, and ends (to date) with over 2000 weapon handouts illegally by the PTB.

A Nation of Law.Breaking the Law, in the name of the Law, seems we have a Pandemic here, in a 10sq mile area.

Run by lawbreakers............................Top to Bottom.

LMAO's picture
"Now, if only someone can figure out how Warren Buffett's Wells Fargo, with its several hundred billion worth of Wachovia toxic biohazard, is not on the list of defendants..."

Uncle choo-choo "All-in bet on America" Warren is enjoying himself in the bathtub knowing another quid pro quo deal was landed in the BAC trade-off against the all-in bet on American infrastructure which the Big Zero is going to announce in the coming week. Warren The Saviour Buffet is becoming increasingly untouchable.

The Big O will be promising jobs, the taxpayer will pay for them and the stinking* orifice of Omaha will cash in once again.

 

* Sorry Warren, no bathtub visit will ever wash away that smell

Kayman's picture

 no bathtub visit will ever wash away that smell

Buffets not washing, he's drinking the bath water.

williambanzai7's picture

They signed a tolling agreement which waives the right to assert the statute of limitations as a defense.

ska11153's picture

WTF, no WFC??? Forget Wachovia..they also own Golden something or another, which has all sorts of crap from the West coast.  Amazing.....truly amazing.  Meanwhile, banks aren't lending yet....this obviously isn't going to help.  I don't understand what this dumb ass administration is doing.  On one hand they want to try to spur the economy, on the other hand they are now going after the banks. I welcome them going after these criminals, but it sure doesn't help the other agenda.  If anyone was uncertain on QE3 before, there is no doubt it is coming now......will it even help??

 

cossack55's picture

Only if helicopters are involved.

rcintc's picture

Golden West Financial - mostly Sub-Prime and Neg Am (real shitty) loans.

DosZap's picture

ska@18:48,

banks aren't lending yet, no one to lend to..........................no hiring, no new businesses.(simple)

On one hand they want to try to spur the economy......................No they don't,they do not want to SPUR anything positive.

 If anyone was uncertain on QE3 before, there is no doubt it is coming now......Never had a doubt it would come  pre-planned

will it even help??................Yep, their agenda, to Bankrupt the nation,that's the plan.Destroy the nation as a Republic.

Hugh_Jorgan's picture

I'll bet that Wells negotiated a "get out of jail free card" when they were pressured/enticed to take over Wachovia back in early 2009, that's why.

http://www.cbsnews.com/stories/2009/02/09/eveningnews/main4788018.shtml.

Remember, they were in good shape but they were forced to take TARP so that publicly ALL of the banks looked like crap to the sheeple.

reading's picture

The fact that they convinced you they were in "good shape" shows they are better at this then the others.  Wells has more toxic crap chugging through it and sold off as much shitty crap they just got lucky that big Warren had already invested.

Jim in MN's picture

Those (Wachovia sub Evergreen) are the fuckers that stuffed the Presbyterian Church's investment fund (New Covenant) full of toxic MBS garbage. 

They deserve to rot in jail and hell.  And Buffet with them for arranging the 'get out of lawsuit' card. 

barsenault's picture

bastards is all I can say!  lock'em up, and let the inmates have fun with them.

barliman's picture

"Sorry gentlemen, we are not serving any Buffet torts today."

barliman

Sophist Economicus's picture

When they bring suit against the Senate and Congress too, I'll pay attention....

DosZap's picture

<Sophist Economicus  >@18:01,

BINGO, give this man de prize....................!!!

T-Bond's picture

Better get a new toothbrush Dan.

HelluvaEngineer's picture

pound me in the ass prison, now!

brandy night rocks's picture

Putting Levin and Sparks in the same room together should've caused a Shitty Deals Getting Sold To Ignorant, Dependent Constituencies singularity.

Zero Govt's picture

 

"..Sued For Selling Junk, Dogs, Big old lemons, and Monstrosities

 

That just about covers Goldmans entire 80 year history and financial strategy in one sentance ..they started out with a pyramid selling scam and nothing much improved after that

uno's picture

if you pause the video at 3:19 you can see 3 poster children of in-breeding gone terribly wrong.

Bananamerican's picture

fucking gargoyles....The "Talent"  is nothing more or less than the spawn of Satan

Xibalba's picture

No one will ever see the inside of a cell.  THAT'S GUARANTEED.  I bet they settle for less than a billion collectively.  

Jasper M's picture

I'll take the Under on that trade.

Look through your history books. WHen the framework supporting this sort of thing fails, those that Were in favor become targets of popular hatred, and those claiming to serve the electorate find their careers demand they attack their former allies. 

Flounder's picture

If you connect the dots, Blankfein's hiring of Reid Weingarten for himself 10 days ago looks like the chief rat saying FU to the staff and trying to save whats left of his own skin.

chet's picture

That f**ker isn't listed in the lawsuit, but hopefully someone is cooking up a perjury suit against him.

I really thought that the politicians would try to set up the banksters as the great bogeymen of the 2010 election.  Maybe the 2012 election?

pamriallc's picture

What Tyler says here is true..... WFC/Wachovia was the king of option arm finance.  Only reason they may not have been named is again....because while BAC-CFC basically had to get baked in this process.....  the political opportunity to eviscerate BAC (again and again and again and again) is just too great.....  the fact remains that JPM *also* would  likely not have been named *EXCEPT* that they acquired the assets of Bear Stearns and also from Washington Mutual, in which case the lawsuits had to be filed vs the company.

So here we have it.....   "BANKSTERS" is getting old and tired.  For people who want the system to collapse on their watch, they may also consider PIIGS for their new home, perhaps a nice trip to a third world country?  Mayby something nice like a walk to Iceland?  The point being that at this juncture, the system has been purged enough, and that the system will never be perfect.  If we go and sue every chemical company in America for every spill and unearth every lawsuit and etc.... then we won't have a chemical industry either, and maybe technoloogy, maybe then we will completely gut Aerospace Defense?  $150.00 hammer, please?

Point is that WFC wasn't named but that somewhere Washovia will be.  JPM was named but because of WAMU and BSC.  The policymaker witch-hunt in an ELECTION year is precisely the wrong answer, and if I were a bank CEO at this point..... I would relish the opportnity to bring the policymakers to justice.  The next move will be CEO retailiation and policymakers will likely take a step back.  Most of the heads in banking have rolled, and it will never be enough for some people.  These same raving populists want a barter system and global failure to justify their indignation for what has ALREADY happened.  These are the same people typically *most* ill-equipped to deal with the same system that they are essentially *praying for* under the guise of "citizens for liberty---down wiith the bank-sters" line of argument.

Maybe instead of complaining further, the users of ZEROHEDGE could contribute to a fund that would create a bank f their own.  Zero-Financial?  Then the same users could run the bank the way they wanted to.  A brilliant idea, actually.  If it were run with the same zeal as we witness here daily, perhaps it would be well run and extremely successful?  Put all of the great advice from users to better use.

In the meantime, calling the end of the world over and over again is getting pretty pointless.  Make something better than we have today, and use that strength and independence as your unfair competiitve advantage.  That's what we did.

Solutions Delivered Daily.  shawnm@pamria.com

 

gmj's picture
Nassim Taleb: The American Economy Will Transfer $5 Trillion To Banker Pay And Bonuses Over The Next 10 Years

Read more: http://www.project-syndicate.org/commentary/taleb1/English#ixzz1Wpwhinni

Sounds like the problem is not behind us at all.  In fact, it sounds to me like the bankers will not be happy until they have stripped the bones of this nation clean.  So what are you saying, Shawn?  That we should passively accept our fate? 

Bananamerican's picture

"the system has been purged enough"

Moynihan? Is that you?

 

this system won't be "purged" until we see Banksters trying to walk down Wall Street with yachts in their rectums

eduard khil's picture

its pretty crazy that you feel threatened enough by a blog.  go spend your time defending yourself if the us dept of justice comes calling.  otherwise its pointless coming here to just say shut up.

you do raise one prospect as to what a bank run by zh folks would look like.  id imagine quite a few would just say eff banks, eff their crappy interest rates, eff all their stupid buildings that could be replaced with atms, eff crappy customer service, eff debt and loans and servitude.  theyd get cash every payday and put savings in gold or whatever they want.  the rest would be old school like me and go to a small local bank that loans only to worthy people, gives a decent rate on savings, and doesnt need a million branches.

problem is at some point like always, the tbtf banks and tptb align and make it damn near impossible for small banks to survive. my bank gets bought by another and then another and then im just another idiot at bac getting nothing for interest and crap customer srvice.  were  sick of tptb rigging the system, with their double speak and system in place to keep them at the top. and thats why zh is my favorite site on the web, as there is at least one outlet for peoplee that feel like i do

damnitalready's picture

 Most of the heads in banking have rolled, and it will never be enough for some people. 

Who?  Was I sick that day?  What did I miss?

11b40's picture

Amen to that.  Somehow, I don't think has the same definition of "head's rolling" that many here do.

I'm still waiting for some trials.   Sorry, but I have zero sympathy for the banker gangsters.

On top of that......bring back a newer & more stringent version of Glass-Stegall, change the bankruptcy laws back to the way they were, and put Usury Laws in place...ensuring a more complete examination of credit-worthiness.

Bust up all the TBTF banks.  Period.

Piranhanoia's picture

There is no evidence that the Morgue got anything from Washington Mutual. They didn't pay anything.  Fannie Pie was a delicate lassie that knew about icky men like JP and didn't want syphilis by letting them servicer her.  She had already financed their projects with the promise of marriage and affection until she saw the drip, drip drip coming from both their pantlegs and personalites. They all began to drool a lot more explaining why they couldn't pay her if she didn't give in. 

She laid down in the end, and got MER'sd. Poor old poodle wants her honey back, and she doesn't care about who gave it to her, so there.

StychoKiller's picture

Didn't your Doctor warn you not to take Greedquil AND Corruptol??

Side effects include loss of spine, and a strange urge to feel large objects inserted into one's anus!