Not with a Bang but a Whimper – the SEC Enforcement Team’s Propaganda Campaign

Posted by on September 10, 2013 in Agencies & Systems, Government, Politics with 0 Comments
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By William K. Black

“Justice” became an oxymoron in the Bush and Obama administration.  It now means that the elite frauds that became wealthy through their crimes that drove our financial crisis should enjoy de facto immunity from prosecution.  The NYT, however, pictures the SEC as an ultra-aggressive enforcer that virtually never fails to take on the elite CEOs leading the control frauds.

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The SEC data demonstrate its epic failure in preventing the current crisis (the SEC was useless) and deterring future crises (the SEC leaves the fraudulent wealthy officers immensely wealthy).  The SEC has tried to bring enforcement actions against the senior officers of only three of the elite financial institutions (banks).  It has sued twelve senior officers of those three banks (or four if we depart from the SEC’s practice and call Fannie and Freddie different cases).  Its biggest “success” left the former CEO of Countrywide with virtually all of the vast wealth that the SEC claims to be the product of fraud.  It obtained $80,000 (also almost certainly paid by an insurer) from the CEO of IndyMac, the largest fraudulent seller of fraudulent mortgage loans.  That is it for the senior officers of the elite banks whose frauds the SEC says drove the financial crisis.

The SEC, as always, focuses its enforcement on non-elite corporations where it is far easier for its enforcers to rack up higher numbers of “successes.”  The “66 senior” individual defendants were overwhelmingly employed by non-elite banks.  The SEC’s own data demonstrate that it is a paper tiger when it comes to the elite banksters who grew wealthy by leading the frauds that caused the mortgage fraud crisis.

Read more: Not with a Bang but a Whimper – the SEC Enforcement Team’s Propaganda Campaign

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