Of Polls and Polsters | 71 comments (71 topical, editorial, 0 hidden)

Re: Of Polls and Polsters (4.00 / 2)

In my experience -- mostly antitrust work but some big financial fraud work, too -- the perpetrators don't tend to be the officers. They tend to be the mid- to upper-mid-level guys.

Yeah, the high-level guys create the environment and look the other way, almost impossible to catch them on it.

by Colman (colman at eurotrib.com) on Fri Mar 18th, 2016 at 08:24:38 AM EST
[ Parent ]

Re: Of Polls and Polsters (none / 1)

Precisely. It's a "Well, the numbers look good coming out of the (X) Division." Ask no questions, tell no lies, etc.

Of course, the high-level guys undoubtedly became high-level guys by doing the same crap and not getting caught. They were just smart enough to not put it in emails and phone recordings.

Be nice to America. Or we'll bring democracy to your country.

by Drew J Jones (pedobear@pennstatefootball.com) on Fri Mar 18th, 2016 at 10:38:16 AM EST
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Re: Of Polls and Polsters (none / 1)

...adding:

Not sure why ARG listed CFOs, since CFOs don't really do anything but accounting, SEC stuff (in concert with general counsels) and collecting enormous paychecks. Outside of cases like Enron and insider trading stuff (like the Apple backdating thing years back), they're not going to be heavily involved in the kind of day-to-day fraud we have in mind here.

I'm sure there are examples where they are, depending on the company (finance would be the obvious potential exception). They might well have a more active role in strategy in some places, but not generally.

Be nice to America. Or we'll bring democracy to your country.

by Drew J Jones (pedobear@pennstatefootball.com) on Fri Mar 18th, 2016 at 10:55:55 AM EST
[ Parent ]

Re: Of Polls and Polsters (none / 0)

Enron was hardly a trivial example. And even a failed prosecution of a high ranked official, especially after having 'turned' an obviously guilty lower ranked official, would go a long way towards changing the climate of 'fraud is the business model'.

And I think you significantly minimize the scope for prosecution that has been ignored under 'regulatory forbearance'. A high profile investigation of the NY Fed with a covert agent or another insider who came forward, were it made clear that whistle-blowers will NOW be protected, not outed, with the skills of Carmine Segarra, could be quite devastating. Hell, a Democratic Senate could convene a special committee to investigate the New York Fed and have public hearings with Carmine as the star witness. It would be electrifying: regulatory capture illustrated - with a beautiful, passionate and articulate figure who was there.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Fri Mar 18th, 2016 at 11:30:21 AM EST
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Re: Of Polls and Polsters (none / 1)

Enron was hardly a trivial example. And even a failed prosecution of a high ranked official, especially after having 'turned' an obviously guilty lower ranked official, would go a long way towards changing the climate of 'fraud is the business model'.

I didn't say it was trivial. I just said it wasn't the norm for what I think you have in mind. And Enron's CFO did go to jail. As did executives in the bid-rigging case involving municipal bonds (remember the Jefferson County bankruptcy?).

My point is that you can turn all the low-ranked officials you want. The CEO-/CFO-types generally aren't the ones involved.

And I think you significantly minimize the scope for prosecution that has been ignored under 'regulatory forbearance'. A high profile investigation of the NY Fed with a covert agent or another insider who came forward, were it made clear that whistle-blowers will NOW be protected, not outed, with the skills of Carmine Segarra, could be quite devastating. Hell, a Democratic Senate could convene a special committee to investigate the New York Fed and have public hearings with Carmine as the star witness. It would be electrifying: regulatory capture illustrated - with a beautiful, passionate and articulate figure who was there.

This sounds great. I'm all for it. And I'm sure all six CSPAN viewers would find it riveting. But this goes to the "What's really scary is what's legal" bit.

Be nice to America. Or we'll bring democracy to your country.

by Drew J Jones (pedobear@pennstatefootball.com) on Sun Mar 20th, 2016 at 10:52:46 PM EST
[ Parent ]

Re: Of Polls and Polsters (none / 0)

"And I'm sure all six CSPAN viewers would find it riveting."

Millions of Progressives would find Carmine Segarra's testimony riveting. It would be like John Dean's testimony before the Ervin Committee all over, but with the New York Fed and the whole way our monetary system is run and (not) regulated as the subject being investigated.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Mon Mar 21st, 2016 at 11:06:38 AM EST
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Re: Of Polls and Polsters (4.00 / 2)

A bank CFO would normally be in charge of at least part of the treasury operations, certainly the management of the held-to-maturity book. London-Whale kind of stuff could happen under their purview.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman

by Carrie (migeru at eurotrib dot com) on Mon Mar 21st, 2016 at 10:17:39 AM EST
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Re: Of Polls and Polsters (none / 0)

Sure, but the London Whale was stupidity, not fraud, no?

Be nice to America. Or we'll bring democracy to your country.

by Drew J Jones (pedobear@pennstatefootball.com) on Mon Mar 21st, 2016 at 01:49:52 PM EST
[ Parent ]

Re: Of Polls and Polsters (none / 0)

Stupidity, hubris and confusion at least. Fortunately for JPM, another unit of JPM unknowingly took the other side of some of his derivative bets, thereby reducing the damage. It was clearly a deliberate violation of Sarbanes-Oxley, the consequences of which are a testament to the lobbying power of Wall Street.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Mon Mar 21st, 2016 at 07:54:07 PM EST
[ Parent ]

Re: Of Polls and Polsters (none / 0)

Yves at NakedCapitalism keeps hammering on about how high level guys have to regularly sign off on the quality of their internal monitoring so a failure there would make them personally liable. Sarbanes Oxley is the key word here I think. Don't ask me how practical that would be in the real world.

by generic on Fri Mar 18th, 2016 at 11:15:02 AM EST
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Re: Of Polls and Polsters (none / 1)

Yeah, in theory. In practice I suspect that they'll find some way to blame minions further down. Some sort of strict liability rule may work for civil penalties, but might run into trouble for criminal sanctions.

by Colman (colman at eurotrib.com) on Fri Mar 18th, 2016 at 11:23:24 AM EST
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Re: Of Polls and Polsters (none / 1)

Then the civil penalties should be extended to a lifetime bar from serving in a position of fiduciary responsibility - for starters.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Fri Mar 18th, 2016 at 11:34:57 AM EST
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Re: Of Polls and Polsters (none / 0)

That would be a nice touch - though in Irish law I have a funny feeling it might fall foul of a right to earn a living.

by Colman (colman at eurotrib.com) on Fri Mar 18th, 2016 at 11:36:02 AM EST
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Re: Of Polls and Polsters (none / 0)

Is there such a right explicitly or implicitly guaranteed in the Irish Constitution? Even if there is a lifetime ban on positions of fiduciary responsibility does not prevent one from making a living - just from doing so with other people's money.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Fri Mar 18th, 2016 at 12:49:52 PM EST
[ Parent ]

Re: Of Polls and Polsters (none / 0)

There's something complicated about it, I don't quite recall what. Might be common law.

by Colman (colman at eurotrib.com) on Fri Mar 18th, 2016 at 12:56:30 PM EST
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Re: Of Polls and Polsters (none / 1)

As long as they can carry out menial work their right to earn a living is protected...

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman

by Carrie (migeru at eurotrib dot com) on Mon Mar 21st, 2016 at 10:14:38 AM EST
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Re: Of Polls and Polsters (none / 0)

I do know that Michael Milken is effectively prohibited from ever again working in the financial industry personally. But he still got to keep $500 million in assets and cash. I think a million would have been quite sufficiently generous and certainly no more than $10 million. He did far more damage than that via the junk bond scandal, and $440 million might have gone a ways towards compensating some of the victims, preferably starting with the most vulnerable.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Fri Mar 18th, 2016 at 12:54:50 PM EST
[ Parent ]

Re: Of Polls and Polsters (none / 0)

Does this mean that reckless drivers get to keep their licence in Ireland if they need to drive for their living? Or does the Irish Constitution have a special clause protecting bankers?

by gk (gk (gk quattro due due sette @gmail.com)) on Fri Mar 18th, 2016 at 01:07:36 PM EST
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Re: Of Polls and Polsters (none / 1)

No such right in the US. We take away the ability to make a living above the poverty line with every felony conviction.

by rifek on Mon Mar 21st, 2016 at 10:18:55 PM EST
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Re: Of Polls and Polsters (none / 1)

Right, that's all going to be civil stuff.

Be nice to America. Or we'll bring democracy to your country.

by Drew J Jones (pedobear@pennstatefootball.com) on Sun Mar 20th, 2016 at 10:57:12 PM EST
[ Parent ]

Re: Of Polls and Polsters (none / 1)

Strict liability works in crim law all the time. Look at a number of federal criminal laws (e.g. the environmental statutes) or the bad check statute we have here in Utah, which frankly something out of Kafka.

by rifek on Mon Mar 21st, 2016 at 10:15:33 PM EST
[ Parent ]

Of Polls and Polsters | 71 comments (71 topical, 0 editorial, 0 hidden)

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