The Secret Goldman Sachs Tapes "The Ray Rice Video For The Financial Sector Has Arrived" [View all]

[kpete]

From the link: "How Segarra got herself fired by the Fed is interesting. In 2012, Goldman was rebuked by a Delaware judge for its behavior during a corporate acquisition. Goldman had advised one energy company, El Paso Corp., as it sold itself to another energy company, Kinder Morgan, in which Goldman actually owned a $4 billion stake, and a Goldman banker had a big personal investment. The incident forced the Fed to ask Goldman to see its conflict of interest policy. It turned out that Goldman had no conflict of interest policy -- but when Segarra insisted on saying as much in her report, her bosses tried to get her to change her report. Under pressure, she finally agreed to change the language in her report, but she couldn't resist telling her boss that she wouldn't be changing her mind. Shortly after that encounter, she was fired."

Inside the New York Fed: Secret Recordings and a Culture Clash

A confidential report and a fired examiner’s hidden recorder penetrate the cloistered world of Wall Street’s top regulator—and its history of deference to banks.

http://www.propublica.org/article/carmen-segarras-secret-recordings-from-inside-new-york-fed
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today -- Friday, Sept. 26 --- the radio program "This American Life" will air a jaw-dropping story about Wall Street regulation, and the public will have no trouble at all understanding it:

The reporter, Jake Bernstein, has obtained 46 hours of tape recordings, made secretly by a Federal Reserve employee, of conversations within the Fed, and between the Fed and Goldman Sachs. The Ray Rice video for the financial sector has arrived.

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It's an extraordinary document. There is not space here to do it justice, but the gist is this: The Fed failed to regulate the banks because it did not encourage its employees to ask questions, to speak their minds or to point out problems.

Just the opposite: The Fed encourages its employees to keep their heads down, to obey their managers and to appease the banks. That is, bank regulators failed to do their jobs properly not because they lacked the tools but because they were discouraged from using them.

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MORE:
http://www.bloombergview.com/articles/2014-09-26/the-secret-goldman-sachs-tapes
http://www.propublica.org/article/carmen-segarras-secret-recordings-from-inside-new-york-fed

ProPublica's Jake Bernstein tells the story of Carmen's first months at the New York Fed, and how she came to start recording. And we hear the story of how the Fed examiners respond to an unusual, questionable deal that Goldman Sachs did -- a deal that the top Fed guy stationed inside Goldman calls "legal but shady."

This story was co-published with This American Life, from WBEZ Chicago.

Hear the radio version on these stations or download the episode now.

HERE: http://www.thisamericanlife.org/radio-archives/episode/536/the-secret-recordings-of-carmen-segarra