Goldman Sachs or Government Sachs: No More Tales?

A guilty plea in the 1MDB case would be a first for Goldman. It has never pleaded guilty in its entire history of 150 years (founded in 1869). Why? It has great connections in Washington (and beyond) – formerly Robert Rubin, Hank Paulson, now Steven Mnuchin, Gary Cohn, John C. Whitehead, Mario Draghi (European Central Bank), Mark Carney (Bank of England), Malcom Turnbull (former PM, Australia) and many more!

Goldman has several controversies with Matt Taibbi characterizing them as a “great vampire squid” sucking money instead of blood and engineering every market manipulation since the Great Depression.

Goldman misled investors and profited from the collapse of the mortgage market in 2007-2008. Goldman’s assortment of misdeeds includes:

• Stock price manipulation;
• Use of offshore tax heavens;
• Involvement in European sovereign debt crisis – ask Greece!;
• New York Federal Chairman’s (Stephen Friedman) ties to Goldman;
• Insider trading – Ivan Boesky, Robert M Freeman, Rajat Gupta and Raj Rajaratnam and others;
• Sale of CDOs in the 2008 crisis (In fact, it received USD12.9 billion to unwind credit default swap (CDS) contracts with AIG;
• Securities fraud in 2010;
• Commodity price manipulation;
• Libya investment losses; and
• 1MDB (2015) and bond deals, Goldman made USD600 million (or more) from USD6 billion bond sale.

Former employees testify there is an “organizational drift” in the firm. Steven George  Mandis and Greg Smith will vouch for that – a toxic, destructive environment in which “the interests of the clients are to be sidelined”. Clients are “muppets” to be “ripped off”. And how did they do it? Expertise and reputation. Expertise to sell sophisticated products to unsophisticated clients and then leverage on their connections in Washington, London, Brussels or wherever!

So a guilty plea in the 1MDB case will be a first for Goldman! Their current tale is that the Malaysian officials (including the former PM) misled them! LOL!

References:

1. Goldman Sachs controversies (https://en.wikipedia.org)

2. Goldman Sachs and its crimes (www.google.com search)