September 14, 2009

Lose something?


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All of us here at Dakota are dying to land a big cybersmack on Judge Jed Rakoff's white whiskers because he ruled today that a mere $33 million settlement between the SEC and the Bank of America “does not comport with the most elementary notions of justice and morality.” The duplicitous Bank of America told investors that Merrill would not pay year-end bonuses without BoA's consent when, in fact, it actually paid between 3.6 and $5.8 BILLION in bonuses and didn't share that information with shareholders.

Stephen Bernard reports for Huffington Post

A federal judge on Monday rejected a $33 million settlement between the Securities and Exchange Commission and Bank of America Corp., saying the SEC's accusations of inadequate disclosure by the bank over bonuses paid at Merrill Lynch must now go to trial....

Rakoff, in his ruling, found that the proposed settlement "suggests a rather cynical relationship between the parties: the SEC gets to claim that it is exposing wrongdoing on the part of the Bank of America in a high-profile merger, the bank's management gets to claim that they have been coerced into an onerous settlement by overzealous regulators. And all this is done at the expense, not only of the shareholders, but also of the truth".

The Observer tells us why his ruling was full of snappy quotes: "Rakoff, who has a B.A. in English from Swarthmore and went on to read philosophy at Oxford, quoted briefly in his Bank of America ruling from Oscar Wilde's 1892 play Lady Windermere's Fan. He cited only one line, that a cynic is someone 'who knows the price of everything and the value of nothing'."

Thirty three million would have been quite a bargain if the greedy bastards had slipped this one by.

When it comes to banking practices in general, our heroine, Elizabeth Warren, reminds us that we, the American people, have no lobbyists representing our interests, and recommends that we barrage our congressmen and senators with calls and email asking for the three things:

. a consumer financial protection agency
. regulation of credit rating agencies
. a creditable liquidation threat to those organizations that are deemed "too big to fail" (like the one require for GM)

We can also hope New York Attorney General Andrew Cuomo will nail the sleazeballs or take matters into our own hands.

Photo note: Purse on fence - cross onto which to get nailed in background - a metaphorophoto

Posted by Dakota at September 14, 2009 03:54 PM