Cuomo

Will the NY Attorney General Bring Doomsday Charges Against Wall Street? If So, How Long Will He Survive?

Michael Collins


Gretchen Morgenson of the New York Times just published one of the few feel good stories in months following the 2008 financial crisis. She describes a possible day of reckoning for the perpetrators of the 2008 crisis and much of the pain that has followed.

The newly elected New York attorney general, Eric Schneiderman (D), wants information from Goldman Sachs, Bank of America, and Morgan Stanley. Among other things, the information concerns mortgage pooling and bundling. This may well include information on collateralized debt obligations (CDO's) and mortgage backed securities (MBS). New York state officials told Morgenson:

"The New York attorney general has requested information and documents in recent weeks from three major Wall Street banks about their mortgage securities operations during the credit boom, indicating the existence of a new investigation into practices that contributed to billions in mortgage losses." New York Investigates Banks’ Role in Financial Crisis New York Times, May 16

 

Cuomo Takes on The Money Party

Bank of America Looks Like  First of Many

Michael Collins

"This merger (Bank of America and Merrill Lynch) is a classic
example of how the actions of our nation’s largest financial
institutions led to the near-collapse of our financial system," said
Attorney General Cuomo. "Bank of America, through its top management,
engaged in a concerted effort to deceive shareholders and American
taxpayers at large. This was an arrogant scheme hatched by the bank’s
top executives who believed they could play by their own set of rules.
In the end, they committed an enormous fraud and American taxpayers
ended up paying billions for Bank of America’s misdeeds."
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New York State Attorney General Andrew Cuomo

Andrew Cuomo's complaint filed in the New York Supreme Court, County
of New York against the Bank of America and two former top executives
has the potential to push that too big to fail entity off the edge of a very steep cliff. The charges of massive fraud are based on a compelling and exhaustive filing on February 4.

A trial will likely involve testimony by the current Bank of America CEO and President Brian Moynihan against defendants Kenneth Lewis, the bank's former CEO and board chairman, former chief financial officer (CFO) Joseph L. Price, and the bank itself. Price is currently in charge of BofA's credit card division.

The complaint charges fraud before, during and after the bank's
merger with struggling brokerage firm Merrill Lynch in late 2008. The
fraud cost bank shareholders and citizens billions of dollars. This is
the first major case brought against our nation's largest financial institutions. These are the same financial institutions and executives that nearly destroyed the economy.