[Marxism] Seven Questions for the SEC regarding Goldman

michael perelman michael at ecst.csuchico.edu
Sat Jul 17 12:07:53 MDT 2010

Today the Wall Street Journal has a very good article analyzing the 
Goldman victory over the SEC.  The article is not yet gated, so I put 
the reference first.

Scannell, Kara and Susanne Craig. 2010. "SEC Split Over Goldman Deal." 
Wall Street Journal (17 July): p. A 1.

Question 1: Is Ms. Casey really asking if the agency caved?  Probably 
not, but if so, that is interesting.

"Republican Commissioner Kathleen Casey questioned the SEC staff 
Thursday on their decision to abandon the strongest fraud charge and 
strike a settlement involving a lesser allegation, and given that, how 
the SEC could justify such a large penalty on a lesser charge."

Question 2: Is Russell Ryan saying that the SEC did not have enough 
proof to charge Goldman with intentional fraud rather than giving 
incomplete information?  After all, the fraud has been public knowledge 
for some time.  Why did the SEC cave?

"Russell Ryan, a former SEC enforcement lawyer, said the negotiation to 
drop the strongest fraud charge is "usually a strong indication the SEC 
had some doubt whether it could prove intentional fraud. Mr. Ryan, now a 
defense lawyer at King & Spalding, said the SEC typically insists a 
defendant settle on the strongest allegation made in its complaints. 
Watering down the toughest charge, as in this case, is unusual."

more at:


Michael Perelman
Economics Department
California State University
Chico, CA

530 898 5321
fax 530 898 5901

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