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now here's a question wise at wall street in jail to question i love social
titled a great you expose rolling stone reported that i_t_t_
lol talk to in just a moment
what i find answer that question so he said look into it uh... senate
investigator given the spoiler alert
everything's after up
and nobody goes to jail
not sold story
right there
that turns out to be slightly inaccurate actually one day i didn't go to jail his
name is pretty low
he's a ponzi scheme er was serving a hundred and fifty year prison sentence
but he said in a jail house every released today back in the new york
times paul
the banks had said no
but the attitude was sort of
indeed it was something wrong
we don't want to know
and that gets it exactly right
they didn't want to know they're making money hand over friends who wants to
find out
by the way you know what made off with the gel no one else could
he stole from the rich
that was stupid
if you steal from the average guy
you get away with it they want to see examples a big fall he was running women
brothers and of course imploded
you know what he walked away with
five hundred and twenty nine two million dollars
he suspected were hiding conversation
to make it appear they got lax andy's at also suspect of lying about his
conversation the congress
what kind of charges that you get nonna
about punishment squash
no silly joke is set up
you work for energy financial products which crashed spectacularly
and by the way it was largely thanks to joe cassano nice work jock
any walked away with
two hundred n eighty million dollars during his tenure
he suspected of misrepresenting the risk of mortgage derivatives
which she can listen said one quote
lose a single dollar in the market
what kind of charges the first woman governor let me also pays no charges
punishment built show we're going to see that coming haven't done that
he was on again off again had
and actually is the current chairman of the ward off
morgan stanley he was invested in two thousand five for allegedly giving out
insider information
which may have resulted in a quid pro quo deal worth ten million dollars to
him personally
he also face the charges
add no punishment
and the way that went down is actually a perfect illustration of everything
that's wrong with our financial system and why they get away with all this
gerry to gerry wasn't s_e_c_ investigator who smelled something fishy
imax film so you want to look into it
and he basically this is a good guy he was trying to do the right thing
so what happen again
he went to his bosses and his boss of the time were paul berger
he was the s_e_c_'s associate director reports that
although he got fired but we get back to commit sector dot right now
so he doesn't want says that he he would be guy we just told you about and that
tortoises boss of the time work for today
are you saying that i say a
morgan stanley
beer
the guy who wouldn't prosecute
now works for the guiding one prosecute they'll emma thompson she was as he sees
a recurring forstmann and other boss of gerry
yes which is now
she's a lawyer representing wall street firms
we hear i didn't see that coming
now i have external forces who pushed back on the s_e_c_
to make sure that there was no investigation mary jo white she was an
attorney representing morgan stanley
gets where she was before that
she was a u_s_ attorney in new york
the top cop on wall street
and of course it was very late show
was max attorney before that he was the s_e_c_'s director of enforcement
do you see what's happening in your guys it's called a revolving door
there waiting for the past
or you know that's a gate the guy whom i give you millions of dollars
in your next job
idea really good guy like gary you might
i don't know what happened there now let's do it
boom fired
everybody else gets paid garry gets fired for being a good guy
now you see how they get away with it
all right let's do more than with joining me now is met a guy who wrote
that article is a contributing editor for rolling stone spend up by the way
that article appears in new issue roast on this fascinating
look i'd a lot of guys the wiling to school with who are part of the circuit
if you go to only tell more fights over the top top notch you're being totally
unfair right
are we being unfair them that they just just a good guys trying to do their job
nothing up here and we're not being unfair look
in this country the reality is
if you go out and you sell a dime bag in the street mc ops easy it is a very good
chance that you will actually go to jail you'll do real jail time
insider trading fraud in a massive scale
stealing billions of dollars putting a million people in the foreclosure
defrauding
thousands of janitors and cops and firemen out of their pensions
nobody's going to jail for the stuff it's it's really it's a class issue
these guys do not go to jail made off was the only person in the entire
financial crisis who is doing time even somebody like angelo mos illa
they couldn't find a way to put him in jail and all that it was fine and less
than half of his net worth so it's a it's an incredible situations really
really dangerous for the country
so that look a lot of elicit look i used bad judgment my bad dog okayed so i lost
you know a couple million dollars loving criminal here
that would
all these banks
on a larger level were complicity in a sort of a general fraud scheme an afro
scheme was to to sell
mortgage-backed securities toxic mortgage-backed securities as triple-a
rated investments during this mortage boom they were essentially selling
worthless crap
as triple-a rated investments and they were selling it to people like pension
funds that's why your pension has decreased in value because some banks
old ufone east securities that they knew were going to blow up
that securities fraud that's a that's a good abroad fraud scheme that all these
banks work implicit in but at a lower at another level they were also involved in
basically every kind of crime you can have in the financial services market
insider trading they were hiding billions of dollars in losses lots of
these banks were involved in and ron ask schemes to hide losses uh... against
fraud n_p_r_ insider trading all that stuff was going on and nobody got
prosecuted for it
at the banks were there
email specifically say hey we notice that the stock cigar we know it's not
going to work or we know it's john yeah absolutely riveted or drug raid example
is is the bear stearns hedge fund that blew up this is the one case that they
have been actually took the trial
where these two guide these guys are running this this hedge fund that would
involve sub-prime mortgages and that was the this blowing up of this funds what
caused bear stearns to go out of business but they had been else from his
guys telling your boss is look we are never going to make money
on this stuff and then a few days later there at saint publicly this is it has
been a disaster it's all going to be fine and that's just straight up fraud
when when they do that that's how it that's what it was true crime looks like
and they were convicted for
right and then you got goldman sachs email saying hey we're selling crappy
stop alitalia muzzle on his emails and i can't believe worse on this trip
so but the people at home dot to be wanting so why are they doing it right
but like it seems like that's going to see if your company indeed it sunk edgy
side wing of others
so why they do it anyway
where people have to understand is that the system of incentives on wall street
has been completely perverted a minute
all these guys it doesn't matter they don't care if they blow up there cos
they don't care we end up having to bail them out
they get their bonuses anyway up all these guys even the ones who were in
disgrace now guys like joe cassano who you know help blow up they are g
lost he need two hundred eighty million dollars in these he's keeping all that
money it uh... it doesn't matter how irresponsible how wrong you are
uh... the incentives are the there for these guys tutor to do all this stuff
because they never have to pay in hand the taxpayers had to pay every dime of
that two hundred eighty million dollars eventually
but as you well under and i guess it is crazy but it's not crazy because as you
explain and defend itself for us one of the prosecutor
well it's and i think that the key issue here is is the revolving door and i
think that uh... everybody every source that i talked to in researching the
story pointed out the same thing all these guys
than ever to mean koster the s_e_c_ in the u_s_ attorney here in new york
if you are one of the top investigators in the s_e_c_ or the or the u_s_
attorney's office
yeah when you leave those offices there is a there's a partnership waiting for
your one of these big corporate defense firms in those partnerships are worth
millions of dollars a year
these guys are all the equivalent of college basketball players waiting for
their first n_b_a_ deal by it's it's an enormous amount of money and it's so
what ends up happening this it's uh... it's it's a collegial sort of married
around
of lawyers who all know each other they're all of us in the first name
basis with each other
you have a situation like a gear a
you know he's trying to prosecute ah... investigate morgan stanley and morgenson
his lawyers are going five levels over his head to talk to the director of
enforcement they're talking to his bosses boss's boss
well he is trying to do it to prosecute this case and at the very least is in
places say made here got your team player we got a job but more recently
waiting for you with millions of dollars have sort of law firm that is working
for morgan stanley and that's how it works
that's what is the prosecution's
great piece matt really appreciate your time tonight thanks good singer