Good luck, Lloyd. You’ve had a hell of a run. Should I remind readers that this story was reported in the LA Times? I’ll remind them also that Goldman Sachs and the other big investment banks got $1.2 trillion in easements in 2008 and that profits soared subsequently, along with bonuses. In short, we the people rescued the same guys that crashed the system and did practically nothing for the homeowners who were gamed and lost their homes and money and are still suffering foreclosure.
In this criminal climate, one of the most unforgettable scandals was the CDOs (collateralized debt obligations) created by Goldman. They were the worst home loans made, purposely selected and bundled together into securities and sold to clients of Goldman Sachs. In fact, Sachs hedged $6 million of their own money on them to fail and made hundreds of millions from clients who bought them thinking Goldman had bought them also to get a piece of the action.
Goldman became the standard of corruption in a very corrupt investment banking business, in which no one has yet to go to jail, or gotten fired for incompetence or thrown out a window out of sheer investor anger. But now, something’s happening.
Lloyd Blankfein retained the lawyer Reid Weingarten. It seems that a result of the inquiry into the financial crisis conducted by the Senate’s Permanent Subcommittee on Investigations, the group released a report about the crisis that accused Blankfein of lying to Congress, a report then passed on to the Department of Justice. In addition, New York’s district attorney is reportedly looking into the issues raised by the report and had subpoenaed Goldman. So Lloyd’s got a migraine.
Reid Weingarten is an attorney known for representing clients in high profile cases of alleged corporate wrongdoing. His clients have been former executives of WorldCom, Inc., CEO Bernie Ebbers (now in jail for 25 years) and former Tyco International Lt. General Counsel Mark Belnick, who received no jail time for stealing but paid a $100,000 fine. So Weingarten’s batting around 450. That one-hundred grand fine stung, but is basically chump-change in this ballgame.
Weingarten’s firm’s areas of special competence include “cases involving public corruption, the Racketeer Influenced and Corrupt Organizations Act, bank fraud, bribery, government procurement fraud, antitrust, healthcare fraud, and tax and securities fraud.”
The L.A. Times reports a Goldman Sachs’ spokesperson saying, “As is common in such situations, Mr. Blankfein and other individuals who were expected to be interviewed in connection with the Justice Department’s inquiry into certain matters raised in the [Senate subcommittee] report hired counsel at the outset.”
The L.A. Times goes on say, “The decision to bring in a top legal name such as Weingarten suggests how seriously Blankfein is taking the investigation and that there could be a new push to investigate the firm and its executives on criminal grounds. The move hire an outside attorney was first reported by Reuters. Good for Goldman. Bad for Blankfein. Sucks for Sachs. But so it goes. Somebody has to sound a wake-up call to these bozos before they do it again, and again, and again, thinking like bad kids that nobody’s watching the cookie jar so why not empty it. Because it’s stealing, schmucks.
“The firm has been dogged by investigations, but so far the cases have not involved criminal charges and have been settled without Goldman admitting to any wrongdoing. Though last summer, Goldman paid $550 million to the Securities and Exchange Commission to settle charges that it helped create low-quality-backed securities (the CDO’s) that it knew would fall in value.”
Moreover, the firm’s stock finished down 4.7% on August 23, 2011 (the day of the announcement), down $5.25 to $106.51. It’s good to see Goldman moving in a different direction for a change. “The stock fell further,” the L.A. Times said, “after hours.”
Those commenting said . . .
“He’s got an incredible amount to lose, and there’s a lot of anger out there,” said Philip Hilder,” a criminal-defense attorney in Houston. “It signifies that the investigations are serious in tone and that he’s not taking them lightly.”
“Given the high stakes, Blankfein had to make sure somebody is watching out for his personal interests,” experts said.
“I would have been more surprised if he had not retained counsel,” said Terree Bowers, a partner at Arent Fox in Los Angeles.
I say it couldn’t have happened to a worse guy. His greed is only surpassed by his arrogance. I just wonder how he’ll look in orange.
Jerry Mazza is a freelance writer, life-long resident of New York City. An EBook version of his book of poems “State Of Shock,” on 9/11 and its after effects is now available at Amazon.com and Barnesandnoble.com. He has also written hundreds of articles on politics and government as Associate Editor of Intrepid Report (formerly Online Journal). Reach him at gvmaz@verizon.net.
