Judge Blocks Sweetheart Settlement & A Few Alternatives November 30th, 2011 Judge kicks butt. Stockholders you have a friend in Judge Jed S Rakoff. Finally the top 5 percent have someone representing them, in their struggle for a fair shake from the evil Wall Street crowd and the bend over S.E.C. The rest of us will find this to be pretty much a yawner.
What would the rest of us be excited about? Well perhaps if the banks and government lowered mortgage rates to the market rate and wrote off the rest of the value of the house as a bad bet in an economic bubble that they helped create and certainly were aware of. That would be a good one for starters. Next perhaps the government should institute a national minimum income for all citizens, national free medical care and guaranteed housing for all citizens. How would they afford that? Well a 50% tax on incomes over 1 million would be a start. Next a Social Security tax on all income, and not just the first $135,000. Then a tax on unearned income of 50% after the first $100,000 would be nice. Cut defense by 50%. A transaction tax on all stock market transactions of say .5%would be a decent start there. A relocation tax on businesses of the equivalent of one year's gross income before taxes would be useful. Or even better simply outlaw relocations without a vote of the community and workers in which the company exists. While we are at it add a German style workers councils on the board of directors of every company with over 50 employees. Now we are talking about reforms that will make a difference. http://www.mistieurope.com/pdf//MIS/GSI_German%20Works%20Council%20Approval_whitepaper_UK.pdf http://en.wikipedia.org/wiki/German_model http://www.eurofound.europa.eu/emire/GERMANY/WORKSCOUNCIL-DE.htm Or even better might be workers co-ops, and get rid of the corporate bosses. Even the Pope is in favor of a more humane economy. http://www.justpeace.org/mondragon.htm http://www.youtube.com/watch?v=NORmQ8zaL1c Instead we, the vast majority of the people, will get nothing and a few stockholders near the powerful will get a few crumbs. Judge Blocks Citigroup Settlement With S.E.C. By EDWARD WYATT Published: November 28, 2011 WASHINGTON Taking a broad swipe at the Securities and Exchange Commission's practice of allowing companies to settle cases without admitting that they had done anything wrong, a federal judge on Monday rejected a $285 million settlement between Citigroup and the agency. The judge, Jed S. Rakoff of United States District Court in Manhattan, said that he could not determine whether the agency's settlement with Citigroup was "fair, reasonable, adequate and in the public interest," as required by law, because the agency had claimed, but had not proved, that Citigroup committed fraud. As it has in recent cases involving Bank of America, JPMorgan Chase, UBS and others, the agency proposed to settle the case by levying a fine on Citigroup and allowing it to neither admit nor deny the agency's findings. Such settlements require approval by a federal judge. While other judges are not obligated to follow Judge Rakoff's opinion, the 15-page ruling could severely undermine the agency's enforcement efforts if it eventually blocks the agency from settling cases in which the defendant does not admit the charges. The agency contends that it must settle most of the cases it brings because it does not have the money or the staff to battle deep-pocketed Wall Street firms in court. Wall Street firms will rarely admit wrongdoing, the agency says, because that can be used against them in investor lawsuits. The agency in particular, Judge Rakoff argued, "has a duty, inherent in its statutory mission, to see that the truth emerges." But it is difficult to tell what the agency is getting from this settlement "other than a quick headline." Even a $285 million settlement, he said, "is pocket change to any entity as large as Citigroup," and often viewed by Wall Street firms "as a cost of doing business." According to the Securities and Exchange Commission, Citigroup stuffed a $1 billion mortgage fund that it sold to investors in 2007 with securities that it believed would fail so that it could bet against its customers and profit when values declined. The fraud, the agency said, was in Citigroup's falsely telling investors that an independent party was choosing the portfolio's investments. Citigroup made $160 million from the deal and investors lost $700 million. Judge Rakoff said the agency settlement policy "hallowed by history, but not by reason" creates substantial potential for abuse because "it asks the court to employ its power and assert its authority when it does not know the facts." That undermines the constitutional separation of powers, he said, by asking the judiciary to rubber-stamp the executive branch's interpretation of the law. http://www.nytimes.com/2011/11/29/business/judge-rejects-sec-accord-with-citi.html?nl=todaysheadlines&emc=tha2 ------------------------------------ --------------------------------------------------------------------------- LAAMN: Los Angeles Alternative Media Network --------------------------------------------------------------------------- Unsubscribe: <mailto:[email protected]> --------------------------------------------------------------------------- Subscribe: <mailto:[email protected]> --------------------------------------------------------------------------- Digest: <mailto:[email protected]> --------------------------------------------------------------------------- Help: <mailto:[email protected]?subject=laamn> --------------------------------------------------------------------------- Post: <mailto:[email protected]> --------------------------------------------------------------------------- Archive1: <http://www.egroups.com/messages/laamn> --------------------------------------------------------------------------- Archive2: <http://www.mail-archive.com/[email protected]> --------------------------------------------------------------------------- Yahoo! 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