.... Hillary Clintons shift from declaimer of Big Finance shenanigans to collaborator with Goldman—the firm has donated between $250,000 and $500,000 to the Clinton Foundation—prompts an obvious question: Can the former secretary of state cultivate populist cred while hobnobbing with Goldman and pocketing money from it and other Wall Street firms? Last year, she gave two paid speeches to Goldman Sachs audiences. (Her customary fee is $200,000 a speech.) In recent years, Goldman Sachs has hardly exemplified the values and principles Clinton earnestly hailed in her speech. A few reminders: ~ In April 2011, Sen. Carl Levin (D-Mich.), who chairs the Senates Permanent Subcommittee on Investigations, released a report, based on a two-year investigation, that concluded that Goldman had misled clients and Congress about its investments in securities related to the housing market. Levin called on the Justice Department and the Securities and Exchange Commission to investigate if Goldman had violated the law by selling complicated securities to customers without informing the buyers that Goldman would pocket profits if these financial products dropped in value. Goldman denied the charge, but the previous year Goldman had paid $550 million in a civil settlement with the SEC regarding its sale of these securities. (When the case was first filed, the SEC maintained that Goldman had committed fraud by creating and peddling a mortgage investment that was secretly designed to fail.) ~ In March 2012, Greg Smith, a top Goldman executive who was resigning, wrote an op-ed for the New York Times slamming the screw-the-client culture that permeated Goldman: To put the problem in the simplest terms, the interests of the client continue to be sidelined in the way the firm operates and thinks about making money…I attend derivatives sales meetings where not one single minute is spent asking questions about how we can help clients. Its purely about how we can make the most possible money off of them…It makes me ill how callously people talk about ripping their clients off. Over the last 12 months I have seen five different managing directors refer to their own clients as muppets, sometimes over internal e-mail. The Financial Crisis Inquiry Commissions report also described Goldman as a first-class predator: Despite the first of Goldmans business principles—that our clients interests always come first—documents indicate that the firm targeted less-sophisticated customers in its efforts to reduce subprime exposure. In other words, the firm knowingly peddled junk to suckers who trusted it. The report quoted an expert who noted that Goldmans actions were the most cynical use of credit information that I have ever seen and who compared Goldmans wheeling-and-dealing to buying fire insurance on someone elses house and then committing arson. motherjones/politics/2014/06/hillary-clintons-goldman-sachs-problem
Posted on: Mon, 15 Sep 2014 02:41:43 +0000
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