Remember, Khuzami and the SEC settled with Goldman Sachs, too, despite having a good case against the firm. And it’s worth emphasizing that Khuzami, as the WSJ put it in a headline in April, “Oversaw Deutsche CDOs” before he jumped to the SEC:
Before taking his current job at the SEC last year, the 53-year-old Mr. Khuzami spent five years running the U.S. legal division of Deutsche Bank, one of the largest issuers of collateralized debt obligations in 2006 and 2007. As part of that job, he worked with lawyers who advised on the CDOs issued by the German bank and how details about them should be disclosed to investors. The group included more than 100 lawyers who also defended the bank against lawsuits and vetted other financial products, these people said.
Deutsche Bank has faced allegations of inadequate disclosure over its creation of CDOs.
Why somebody with such an obvious conflict of interest is allowed to head up the SEC’s enforcement division, which was once actually feared on Wall Street, is beyond me. CDOs are instruments at the heart of the financial crash.
This story is one worth watching closely.
As Citi aproaches a new 52 week high, and is less than a week away from discosing 4thl quarter results; buy back the shares you are short, and quit complaining! The rest of us would like to make some money on this issue.
#1 Posted by Leroy S H Greenlee, CJR on Wed 12 Jan 2011 at 05:19 PM
As Citi aproaches a new 52 week high, and is less than a week away from discosing 4thl quarter results; buy back the shares you are short, and quit complaining! The rest of us would like to make some money on this issue.
#2 Posted by Leroy S H Greenlee, CJR on Wed 12 Jan 2011 at 05:21 PM
Mr. Greenlee is right. Why should we complain about the ethics of lawyers and top bank executives who brought the world to its knees?
He's gotta make a few bucks on the stock folks! So please... lets not live in the dream that perhaps someday justice can be done and continue to sleep through the nightmare. A 52 week high is a terrible thing to waste!
#3 Posted by MyPinkSoapbox, CJR on Wed 26 Jan 2011 at 01:00 PM
On September 27, 2011, the SEC's Inspector General issued a detailed report reflecting an extensive investigation into the anonymous allegations raised about the Citigroup settlement. The IG concluded that there was "no evidence" that Khuzami had an unusually close relationship with the defense counsel, or that "any decision was made based upon any friendship." The IG found that Khuzami made "significant efforts" to keep the Enforcement staff informed about the status of the matter, and "considerable efforts" to allow them to express their views on the case. The IG concluded that conversations with defense counsel "did not result in any secret deal."
#4 Posted by formerausa, CJR on Mon 30 Jan 2012 at 03:59 PM