Banks earned billions by creating and selling financial products that essentially backfired in tandem with the housing market, which caused the worst economic crisis in the U.S. since the Great Depression. The recent passage of the Dodd-Frank law is in direct response to this crisis.
Yesterday, Senator Carl Levin (D-MI) released the findings of a two-year probe, and was quoted as saying he wants “the Justice Department and the Securities and Exchange Commission to examine whether Goldman Sachs violated the law by misleading clients who bought the complex securities known as collateralized debt obligations without knowing the firm would benefit if they fell in value,” according to the April 13th washingtonpost.com article, “Goldman Sachs misled Congress after duping clients, Senate panel chairman says”.
Levin also said he wants federal prosecutors to determine whether perjury charges should be brought against Goldman Sachs Chief Executive Officer Lloyd Blankfein and other employees who testified in Congress last year.
Levin was also quoted as saying that Goldman Sachs is “a financial snake pit rife with greed, conflicts of interest, and wrongdoing,” according to an April 14th article at vanityfair.com.
Goldman Sachs spokesman Lucas van Praag was quoted as saying: “The testimony we gave was truthful and accurate and this is confirmed by the subcommittee’s own report.”