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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 ]
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
[ Parent ]
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 ]
"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
[ Parent ]
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 Migeru (migeru at eurotrib dot com) on Mon Mar 21st, 2016 at 10:17:39 AM EST
[ Parent ]
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 ]
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 ]

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