Question by michel foucault: Is this a blueprint for the “office powerpath” ?

["The product was new and complex but the deception and conflicts are old and simple," said Robert Khuzami, SEC's director of the enforcement division in a statement.

"Goldman wrongly permitted a client that was betting against the mortgage market to heavily influence which mortgage securities to include in an investment portfolio, while telling other investors that the securities were selected by an independent, objective third party," he said.]

Does the equivalent of this happen in other contexts ?

reference:
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Saturday April 17, 2010, 5:55 am

A US watchdog has charged top investment firm Goldman Sachs with fraud over the sale of a complex mortgage product like those blamed for the financial meltdown.

The Securities and Exchange Commission, in a civil suit on Friday, accused Goldman of "defrauding investors by misstating and omitting key facts" about the product that was based on subprime mortgage-backed securities.

The SEC said Goldman failed to tell investors that a major hedge fund which helped put together the so called collateralised debt obligation (CDO), was actually betting against it.

Paulson & Co, one of the world's largest hedge funds, paid Goldman Sachs to structure a transaction in which it could take speculative positions against mortgage securities chosen by the fund, the commission said in a statement.

The deal, which took place at the height of the mortgage crisis in 2007 and as the country was about to fall into a brutal recession, was said to have cost investors around $US1 billion ($A1.07 billion).

The suit also named Fabrice Tourre, a vice-president at Goldman who helped create and sell the product, which caused ordinary investors to lose about $US1 billion.

"The product was new and complex but the deception and conflicts are old and simple," said Robert Khuzami, SEC's director of the enforcement division in a statement.

"Goldman wrongly permitted a client that was betting against the mortgage market to heavily influence which mortgage securities to include in an investment portfolio, while telling other investors that the securities were selected by an independent, objective third party," he said.

Goldman rejected the charges as "completely unfounded in law and fact".

It said it would "vigorously contest them and defend the firm and its reputation".

The authorities have not ruled out the possibility of other investment banks involved in the alleged fraud or other similar types of fraud.

"The SEC continues to investigate the practices of investment banks and others involved in the securitisation of complex financial products tied to the US housing market as it was beginning to show signs of distress," said Kenneth Lench, head of the SEC's structured and new products unit.

When news of the fraud charges hit the market, Goldman's shares fell rapidly, as low as 15 per cent to $US156.60.>>

Best answer:

Answer by Houston, we have a problem
- The equivalents to this blueprint happen in most forms of human endeavor

Add your own answer in the comments!

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So many thought all the investment frauds would have ended already. However more and more have come to light. One investment fraud which shocked me was Scott Rothstein who I knew from college. He ran a ponzi scheme to the tune of .2 Billion dollars. Scott Rothstein was a lawyer who donated a great deal of money to all types of charities with the guise he was an honest attorney. Rothstein hobnailed with successful business people, politicians and even Dan Marino. Scott Rothstein Ponzi scheme was based on selling settlements of lawsuits. Now Scott is looking at life in prison.. But worse off his investors lost millions and millions of dollars probably not recoverable. Another recent investment fraud is Thomas Petters. H has been convicted of running a .65 billion Ponzi scheme. Thomas Petters fraud involved selling bogus notes linked to consumer electronics sales which never actually happened. Investors in Petters Co. were told they were buying bulk electronics which were being resold to big-box retailers. Hedge funds and high net worth investors were taken in on this Ponzi scheme. Again Petters faces up to life in prison. The question is why are people so foolish? Was it greed or stupidity? Maybe these people were looking for a low risk avenue to generate positive returns? The reality is there is no free lunch in trading. Those who seek to avoid risk get further embroiled in it. So how does avoid these type of scams? I would suggest managed accounts. In a

Question by sparky slade: What is the sentence for investment fraud?

I am about to be indicted for investment fraud and forgery it was a low amount only 0 ,000 but i am still terrified that i am going to go to prison . what do people think

Best answer:

Answer by Little Hussein
Ask Bernie Madoff what the sentence is ……….. ROFLMAO !

BTW ………….. glad to hear you got caught !! People that steal pension money are VERMIN SCUM !!

I hope you get LIFE !! ………. and chances are good you WILL !!

Remember …………….. Vaseline is your FRIEND !! Bernie says he`d never go to prison without it ………….. LOL………. LOL ………. LOL ………

Know better? Leave your own answer in the comments!

Investment manager pleased clients — until his criminal past emerged

Bruce Fred Friedman is now accused of running a 0-million Ponzi scheme. He denies doing so. The case draws attention to a gap in the oversight of those who run private investment funds. After she retired as a legal assistant, Patricia Hank took her financial planner’s advice and invested her 0,000 retirement savings with Sherman Oaks investment manager Bruce Fred Friedman.

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Protecting seniors from financial abuse

The Elder Investment Fraud and Financial Exploitation project will train social workers and doctors to detect fraud against seniors who may be more vulnerable. Despite the headlines about con artists like Bernie Madoff, your chance of getting swindled out of your life savings is relatively slim. But the possibility grows as you get older.

Read more on Los Angeles Times

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