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In reply to the discussion: Ex-Goldman Trader Who Said $8 Million Bonus ''Too Low'' Involved in Fraudulent Activities [View all]Octafish
(55,745 posts)By LOUISE STORY and GRETCHEN MORGENSON
The New York Times, May 31, 2011
EXCERPT...
The S.E.C. focused in the complaint on disclosures in the marketing of Abacus, saying that the sales documents had failed to tell investors that the deal was devised with the help of John A. Paulson, the billionaire hedge fund manager, who was not named in the case. Mr. (John) Paulsons firm suggested that the deal be linked to mortgages for which he expected a high rate of default, the S.E.C. said; when that came to pass, the bets he placed against the securities proved very profitable for him. But investors on the other side lost more than $1 billion, according to the S.E.C.
SNIP...
In addition, the Senate said that two Goldman employees, Deeb Salem and David Swenson, tried to manipulate prices of securities used to bet against mortgages. Both tried to help Goldman pile on larger bets against the mortgage market, and they wanted to be able to buy such negative bets more cheaply, the report said. Goldman, as a broker, was able to affect prices in the market through the bids and offers it gave out.
Mr. Swenson wrote in May 2007 that the bank should try to start killing prices on certain positions so that Goldman would be able to pick some high quality stuff, according to the Senate report. The strategy, Mr. Swenson wrote, would have people totally demoralized. The pair were unsuccessful in their attempt, and both denied making it to the Senate committee. Mr. van Praag said last week that the report had no evidence of manipulation.
Still, the Senate report said that trading with the intent to manipulate market prices, even if unsuccessful, is a violation of the federal securities laws.
CONTINUED...
http://www.nytimes.com/2011/06/01/business/01prosecute.html?pagewanted=all
I feel bad for him, too, Enthusiast. Like you, I feel worse for our nation and planet, and feel worst of all for what they did to the People.