I don't remember anyone going to jail related to the following two cases. Henry Blodget never went to jail. I think that in these cases the fraud was much worse, especially when you consider the losses in dollar terms and how widespread it was. While my information is pretty much a guess based on precedent, at this time, I believe that it is just as presumptuous for you to say that I am completely wrong. I never said that there wouldn't be hefty fines, but I believe they will not do anything which will overly disrupt the industry a la the Global Settlement.
From Wikipedia article on Eliot Spitzer:
* Global Settlement (2002): Spitzer sued several investment banks for inflating stock prices, using affiliated brokerage firms to give biased investment advice and "spin" initial public offerings of stock by offering them to CEO's and other influential members of the business community. In 2002, a settlement of these lawsuits was negotiated by Spitzer, federal regulatory bodies, stock exchanges, and the investment banks and brokerage houses in question. The result was $1.4 billion in compensation and fines paid by the brokerages and investment banks; new rules and enforcement bodies created to govern stock analysts and IPOs; and the insulation of brokerage firms from pressures by investment banks. Ten firms paid fines to settle the case: Bear Stearns, Credit Suisse First Boston, Deutsche Bank, Goldman Sachs, J.P. Morgan Chase, Lehman Brothers, Merrill Lynch, Morgan Stanley, Salomon Smith Barney, UBS Warburg.
* Late Trading & Market Timing Investigations (2003): Investigations by the office of Eliot Spitzer beginning in 2003 uncovered mutual fund brokers allowing select clients privileges deprived to ordinary customers. Spitzer targeted two practices in particular: "late trading" which allows hedge fund investors to file trades at the previous day's price after the market close, something ordinary customers cannot do; and "market timing" which allows privileged investors to buy and sell shares in funds more frequently than allowed under the fund's rules. The implications of these practices are that the brokerages and a small number of investors profit at the expense of other fund shareholders. In essence, by placing winning trades the privileged investors diluted the profit pool available to all fund shareholders while they sidestepped their share of the pool's losses. Their trading also increased administrative fees borne by ordinary customers and caused fund managers to increase the cash they held to meet liquidity needs. Through a number of prosecutions and lawsuits, Spitzer secured more than one billion dollars in fines and remuneration for investors as well as forcing reforms to eliminate the practice.
I didn't say completely wrong. I just didn't think that you went far enough in realizing how serious it can be.
Comments
I don't remember anyone going to jail related to the following two cases. Henry Blodget never went to jail. I think that in these cases the fraud was much worse, especially when you consider the losses in dollar terms and how widespread it was. While my information is pretty much a guess based on precedent, at this time, I believe that it is just as presumptuous for you to say that I am completely wrong. I never said that there wouldn't be hefty fines, but I believe they will not do anything which will overly disrupt the industry a la the Global Settlement.
From Wikipedia article on Eliot Spitzer:
* Global Settlement (2002): Spitzer sued several investment banks for inflating stock prices, using affiliated brokerage firms to give biased investment advice and "spin" initial public offerings of stock by offering them to CEO's and other influential members of the business community. In 2002, a settlement of these lawsuits was negotiated by Spitzer, federal regulatory bodies, stock exchanges, and the investment banks and brokerage houses in question. The result was $1.4 billion in compensation and fines paid by the brokerages and investment banks; new rules and enforcement bodies created to govern stock analysts and IPOs; and the insulation of brokerage firms from pressures by investment banks. Ten firms paid fines to settle the case: Bear Stearns, Credit Suisse First Boston, Deutsche Bank, Goldman Sachs, J.P. Morgan Chase, Lehman Brothers, Merrill Lynch, Morgan Stanley, Salomon Smith Barney, UBS Warburg.
* Late Trading & Market Timing Investigations (2003): Investigations by the office of Eliot Spitzer beginning in 2003 uncovered mutual fund brokers allowing select clients privileges deprived to ordinary customers. Spitzer targeted two practices in particular: "late trading" which allows hedge fund investors to file trades at the previous day's price after the market close, something ordinary customers cannot do; and "market timing" which allows privileged investors to buy and sell shares in funds more frequently than allowed under the fund's rules. The implications of these practices are that the brokerages and a small number of investors profit at the expense of other fund shareholders. In essence, by placing winning trades the privileged investors diluted the profit pool available to all fund shareholders while they sidestepped their share of the pool's losses. Their trading also increased administrative fees borne by ordinary customers and caused fund managers to increase the cash they held to meet liquidity needs. Through a number of prosecutions and lawsuits, Spitzer secured more than one billion dollars in fines and remuneration for investors as well as forcing reforms to eliminate the practice.
I didn't say completely wrong. I just didn't think that you went far enough in realizing how serious it can be.
Here, look at these, there are quite a few more:
http://www.theregister.co.uk/2006/08/31/reyes_pleads/
http://news.com.com/Criminal+charges...3-6096599.html
http://www1.cchwallstreet.com/ws-por...sp?fn=07-28-06
http://directorship.wordpress.com/20...lder-lawsuits/
http://www.theregister.co.uk/2006/08...ve_ceo_cuffed/
http://www.computerwire.com/industri...E-149755722CE7
http://www.usdoj.gov/usao/can/press/...tions.IRS.html