Friday, August 2, 2013

Yes, they can!

 A former Goldman Sachs trader at the center of a toxic mortgage deal lost a closely watched legal battle on Thursday, giving Wall Street’s top regulator its first significant courtroom victory in a case stemming from the financial crisis.
A federal jury found the trader, Fabrice Tourre, liable on six counts of civil securities fraud after a three-week trial in Lower Manhattan.
....The S.E.C. threw innumerable resources at Mr. Tourre’s case, underscoring its importance to the agency. The onslaught began when the S.E.C. opened an investigation into Goldman after the 2008 crisis.
Lorin Reisner, then the No. 2 enforcement official at the agency, conducted all the pretrial depositions, a task typically assigned to lower-level investigators. When it came time for trial, the S.E.C. assigned Matthew T. Martens to lead the case, although he typically oversees the agency’s trial lawyers without acting as one. 
'Liable', not 'guilty', which would have had to have been proved beyond a reasonable doubt, had the government charged Tourre with a crime. All the muscle the SEC could muster; to get a judgment against a mid-level functionary.

In a case that observers noted, bored the jury so that several fell asleep during the testimony. The 'victims' in the case were some of the most highly educated investment professionals in the world, who had their own due diligence responsibilities to know in what they were investing. Certainly they knew someone had the 'short' side of the trade, if they had the long.

This isn't law. It's politics.

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