CROOK ALERT!! Goldmine Sucks settles subprime case for $60 million; Madoff associates sued for $6 billion

Goldman Settles Massachusetts Subprime Case for $60 million

Without admitting guilt, the Goldman Sachs Group (watch out for "groups!") agreed to pay up to $60 million to end an investigation by the Massachusetts attorney general into the firm's role in the subprime mortgage fiasco. The money will be used to allow Massachusetts homeowners to reduce their mortgages from entities associated with Goldman by as much as 50 percent.

Martha Coakley, Massachusetts attorney general, was sharply critical of predatory Wall Street lending practices in mortgages whose terms were so onerous they were bound to fail. In 2005-2007 Goldman issued $33 billion in mortgage backed securities. Goldman declined to comment on the settlement. See link below for full report.

Madoff Case Suits Seek Recovery of $6.1 Billion

About $12 billion was pulled out of Madoff's firm in 2008 and nearly half of that in the three months before Bernie crashed and burned. Lawsuits have been filed to recover these funds for Madoff's defrauded clients. The Madoff bankruptcy trustee filed two lawsuits seeking the return of $6.1 billion by Jeffrey Picower, a prominent Palm Beach investor and Harley International a Cayman Island hedge fund administered by Fortis, a Dutch bank.

The complaint against Picower goes beyond fiduciary negligence, accusing him of participating in transparently false transactions with Bernie Madoff that were designed to compensate Picower for "perpetuating the Ponzi scheme."  In 1999, one of Mr. Picower's Madoff accounts showed a profit of more than 950 percent. That account and another reported annual returns 1996-99 ranging from 120 percent to more than 550 percent according to the suit.

In other accounts, backdated transactions generated billions of dollars of fictional year-end losses and one account grew by 30 percent from transactions that purportedly occurred months before the account was even opened, according to the NY Times report on the bankruptcy lawsuit.

Picower's lawyer and that of his wife also named in the suit said "They were totally shocked by his (Madoff) fraud and were in no way complicit in it."

See the NYTimes article linked below for a report on this sorry chapter in the history of Wall Street scams.

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Ralph Deeds profile image

Ralph Deeds 7 years ago Author

Two computer programmers who worked for Bernard L. Madoff’s brokerage firm were arrested on Friday on criminal charges of helping perpetuate his long-running Ponzi scheme.

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