SEC: Giving Up on Financial Crisis Prosecutions?
Commission passes on prosecuting major hedge fund
By Kevin Spak, Newser User
Posted Aug 7, 2013 4:40 PM CDT
Securities and Exchange Commission (SEC) Chair Mary Jo White, left, and Commodity Futures Trading Commission (CFTC) Chairman Gary Gensler testify on Capitol Hill in this file photo.   (AP Photo/J. Scott Applewhite)

(Newser) – You might want to stop holding your breath waiting for the SEC to bring the hammer down on more financial crisis ne'er do wells, because the commission appears to be winding down crisis-related investigations. That's what the Wall Street Journal has concluded after getting word from sources that the commission has decided not to recommend charges against Magnetar Capital, a hedge fund that made billions betting against the housing market by creating doomed mortgage-backed securities and CDOs.

The SEC has long been investigating whether Magnetar had a duty to investors who bought its CDOs, but has now concluded that there isn't enough evidence to file charges—which means all the other hedge funds are almost certainly off the hook, too. But not all of Wall Street is getting off so easily; the government yesterday filed two civil suits against Bank of America, accusing it of fraud in the sale of $850 million worth of mortgage-backed securities, Reuters reports.

More From Newser
My Take on This Story
To report an error on this story,
notify our editors.
SEC: Giving Up on Financial Crisis Prosecutions? is...
5%
3%
9%
3%
4%
76%
Show results without voting
You Might Like
Comments
Showing 3 of 26 comments
NorCalHal
Aug 14, 2013 10:47 PM CDT
So how many hundreds of Millions or Billions did this wasted effort cost the taxpayers? Money that could have built schools. paid teachers, repaired bridges or highways.. Did they even mention Blarney Frank and Chris Dodd the policy architects of the zero down, no closing cost home loans that ended in the millions of loan defaults? I would think in this "Open and Transparent" administration they would post the findings for all of us to read ! LOL
crankydude
Aug 9, 2013 11:44 PM CDT
One of the problems is that the feds automatically hire the Ivy League grads with the highest grades. However, those two criteria do not insure they are the most skilled or brilliant candidates. These fair haired staff members do the research and submit analyses and opinions. If they simply have no clue what they are talking about, welllllll............... Not to mention that political influence always takes precedence over legal scholarship.
K.KRANK
Aug 8, 2013 4:54 PM CDT
If they were trying to help the banksters get away with it, dragging out investigations until the statute of limitations runs out is the way to do it.