SLAP ON THE WRIST: GOLDMAN SACHS SETTLES FOR $5.1B OVER MORTGAGE SECURITIES FRAUD THAT LED TO 2008 COLLAPSE
Article first appeared at Thedailysheeple.
In yet another multi-billion-dollar settlement with the Department of Justice resulting from the 2008 housing bubble collapse, Goldman Sachs has now been ordered to pay $5.1 billion for failing to vet its mortgage-backed securities in a move that helped contribute to the economic crisis this country has never really recovered from.
“This resolution holds Goldman Sachs accountable for its serious misconduct in falsely assuring investors that securities it sold were backed by sound mortgages, when it knew that they were full of mortgages that were likely to fail,” said Acting Associate Attorney General Stuart Delery.
Monday’s resolution is the fifth multibillion-dollar settlement reached with U.S. banks resulting from the government’s push to hold Wall Street firms to account for creating and selling subprime mortgage bonds that helped spur the 2008 financial crisis. Other banks, including Royal Bank of Scotland Group Plc and Deutsche Bank AG remain under investigation, people familiar with the matter have said.
The $5.1 billion settlement includes a $2.39 billion civil penalty, $875 million in cash payments, and $1.8 billion in consumer relief, according to a Justice Department statement.
Surely this settlement will hurt Goldman Sachs a whole, whole lot. They might not even be able to afford to pay Hillary Clinton’s $225,000 speaking engagement fee, like the bank did on June 4, 2013, October 24, 2013, and October 29, 2013… Wonder how presidential hopeful Ted Cruz’s wife Heidi feels about her old stomping ground being forced to pay out billions for flipping off the American people?
Just kidding. We’ve all been apprised of the fact that these big banks are “too big to fail” and we all know no one is going to jail. $5.1 billion is a slap on the wrist and it’s years since this even happened. Wonder how much they’ll have to pay when it happens again?
Case in point: on the same day, Reuters is reporting that Wells Fargo has“admitted to deceiving the U.S. government into insuring thousands of risky mortgages, as it formally reached a record $1.2 billion settlement of a U.S. Department of Justice lawsuit”.
For more on how big banks like Goldman Sachs and Wells Fargo screwed over the American people and allowed the housing bubble to happen, check out The Big Short starring Steve Carell and Ryan Gosling; I warn you though, it’s really hard to watch.