Thursday, July 30, 2015

U.S.: Wall St mortgage traders ripped off bank, investors

In 2008 crisis. Justice is slow; will it catch anyone beyond Credit Suisse?

U.S.: Wall St mortgage traders ripped off bank, investors

0 comments

If you've been waiting for the government to try to send someone to prison for what Wall Street mortgage traders did to the economy in the 2008 crash:

Federal prosecutors in New York today charged three Credit Suisse Group traders - including Kareem Serageldin, Managing Director for Structured Credit at Crid Suisse Group - "with freaudulently inflating the prices" of subprime mortgage-backed bonds and commercial mortgage-backed securities in 2007-08.

SEC civil charges, too. More from Reuters here.

Traders' "alleged manipulation" of asset prices cost Credit Suisse more than $2.6 billion whle enabling traders "to secure significant year-end bonuses for themselves" ($7 million for Seragildin alone) at the bank's expense. Two Credit Suisse traders pled guilty to conspiracy to falsify books and records and are cooperating with the Government.

Treasury Secretary Timothy Geithner was quick to praise his government's action; less clear is whether the government is going after traders at Citi, JPMorgan, BofA, Wells Fargo, or other big (and US-based) banks where plenty of professionals also got rich trading overpriced bonds.

0 comments
We encourage respectful comments but reserve the right to delete anything that doesn't contribute to an engaging dialogue.
Help us moderate this thread by flagging comments that violate our guidelines.

Comment policy:

Philly.com comments are intended to be civil, friendly conversations. Please treat other participants with respect and in a way that you would want to be treated. You are responsible for what you say. And please, stay on topic. If you see an objectionable post, please report it to us using the "Report Abuse" option.

Please note that comments are monitored by Philly.com staff. We reserve the right at all times to remove any information or materials that are unlawful, threatening, abusive, libelous, defamatory, obscene, vulgar, pornographic, profane, indecent or otherwise objectionable. Personal attacks, especially on other participants, are not permitted. We reserve the right to permanently block any user who violates these terms and conditions.

Additionally comments that are long, have multiple paragraph breaks, include code, or include hyperlinks may not be posted.

Read 0 comments
 
comments powered by Disqus
About this blog

PhillyDeals posts drafts, transcripts and updates of Joseph N. DiStefano's columns and stories about Philly-area business, which he's been writing since 1989.

DiStefano studied economics, history and a little engineering at Penn and taught writing at St. Joseph's. He has written thousands of columns and articles for the Inquirer, Bloomberg and other media, wrote the book Comcasted, and raised six children with his wife, who is a saint.

Reach Joseph N. at JoeD@phillynews.com, distefano251@gmail.com, 215.854.5194 or 302.652.2004.

Reach Joseph N. at JoeD@phillynews.com or 215 854 5194.

Joseph N. DiStefano
Also on Philly.com:
letter icon Newsletter