It may be frustrating when federal watchdogs strike toothless deals with Wall Street, but it reflects regulators' alarming lack of resources.
Dec 02, 2011
During the early aughts, the financial sector freely gambled with money implicitly or directly guaranteed by taxpayers, selling securities based on worthless subprime mortgages to their customers. We all know how that turned out. Yet those responsible for the worst recession since the Great Depression have for the most part escaped federal prosecution. Given this context, it is easy to understand why United States District Court Judge Jed Rakoff angrily rejected a proposed deal between the Securities and Exchange Commission (SEC) and Citigroup over the company's practice of selling toxic mortgage-backed securities to its customers at the same time it bet against them.