Goldman Beats Lawsuit – Judge Says It was Buyer’s Fault - Armstrong
As if we did not see this one coming. Goldman Sachs, the untouchable firm, won dismissal of a suit over $450 million in residential mortgage-backed securities. The New York judge amazingly shifted the entire burden of responsibility in fraud to the buyer. It was not Goldman Sachs’ fault, the judge said that the firms that bought the bonds should have done more research beforehand – buyer beware.
So let’s get this straight. For any other firm if they make a false statement they go to jail. The S&L Crisis there was the famous case of Lincoln Savings and Loan Association of Irvine, California and Charles Keating. In September 1990, Keating and his associates were indicted by the State of California on 42 counts related to having duped Lincoln’s customers into buying worthless junk bonds of American Continental Corporation. He was convicted on securities fraud stating that when he issued them he KNEW they would fail. In April 1996, the 9th U.S. Circuit Court of Appeals in San Francisco ruled that state trial judge had mistakenly allowed the jury to convict Keating by giving them faulty instructions as the law as regarding fraud. The difference was not that the securities were bad, as in the mortgage-backed mess, but that he somehow KNEW he would go bankrupt a decade in advance.
If you misrepresent the security from the outset, that is FRAUD. Shifting the burden to the buyer and saying they should have known just does not work with any bank outside of New York. The New York courts are just a complete joke. They fail to comprehend that this creates the image of total corruption and when the economy turns down, they will become the target for the world. I warned that transferring the class action lawsuits to New York on Facebook would be the kiss of death. Even NASDAQ asked that everything be dismissed.
Using the judge's logic, everyone should be able to open every box of food they are thinking of buying and eat some of it before deciding whether to buy or not, and take a bite of every unpackaged fruit, vegetable, or meat they are thinking of buying before actually buying it to ensure that they are getting what is on the sign or label. Oh wait; we're talking about the Fed's TBTF / TBTJ banks...never mind...