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Matt Taibbi explains ‘judicial butt-kicking’ of Citigroup deal with SEC

By Eric W. Dolan
Monday, November 28, 2011 23:03 EDT
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Matt Taibbi of Rolling Stone discussed Monday on Countdown with Keith Olbermann the “unusual” decision of a judge to reject settlement Citigroup made with U.S. regulators over its marketing of mortgage securities.

“He came out basically and said that the SEC and Wall Street have been in a wink-wink, nudge-nudge arrangement for years,” Taibbi explained.

“For Judge Rakoff to not only reject the settlement but to reject it in such an aggressive fashion with this very strong rebuke and very strong ruling is very sobering for the SEC,” he added.

“Although this would appear to be tantamount to an allegation of knowing and fraudulent intent… the SEC, for reasons of its own, chose to charge Citigroup only with negligence,” Rakoff said in his rejection of the deal.

Because the SEC so rarely puts forth a full-spirited prosecution, banks consider settlements just the cost of doing business, according to Taibbi.

“They recognize that every now and then they’re going to get dragged into court, they’re going to have to give a little bit of money to somebody, and then they get to walk away and keep doing it,” he said.

The SEC is reviewing the decision to see how it should proceed.

Watch video, courtesy of Current TV, below:

[Ed note: This article was edited after publication]

Eric W. Dolan
Eric W. Dolan
Eric W. Dolan has served as an editor for Raw Story since August 2010, and is based out of Sacramento, California. He grew up in the suburbs of Chicago and received a Bachelor of Science from Bradley University. Eric is also the publisher and editor of PsyPost. You can follow him on Twitter @ewdolan.
 
 
 
 
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