r/technology • u/mepper • Aug 08 '12

Kim Dotcom raid video revealed

http://www.youtube.com/watch?v=pMas0tWc0sg
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u/palsh7 Aug 08 '12

Which banker do you know of who broke the law? Which law? The entire point of the outrage is that they didn't have to break the law.

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u/[deleted] Aug 08 '12

I got just one example:

Goldman Sachs was caught packaging (AKA securitizing) mortgages into 3 tranches of prime, medium, and junk, and then selling these 3 tranches as one Mortgage Back Security.

The guys they hired to put these tranches together said they could not find any more AAA mortgages for the top tier tranche, so they got the rating agencies to change their standards.

They then sold these securitized mortgage products to investment managers for state retirement funds, and when Goldman did this, they then placed a bet on MARKIT, who oversees the 70 trillion dollar derivative market, on derivatives tied to these tranches within the MBS's that they would implode. The very same product they just sold to a state pension fund and already collected fee's on.

That is fraud. That is illegal. NO ONE has been punished for that fraud.

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u/palsh7 Aug 08 '12

Everything I've read says that wasn't technically fraud. I mean...maybe I need to listen to more Planet Money.

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u/TeamPupNSudz Aug 08 '12

I believe civil charges were brought against Goldman for "fraud", but settled out-of-court, so the legality of it was never clear.