Goldman Says It Will Pay $5.1 Billion in U.S. Mortgage Probe

[IDemo]

Source: Bloomberg

Goldman Sachs Group Inc. said it agreed to settle a U.S. probe into its handling of mortgage-backed securities for about $5.1 billion, cutting fourth-quarter profit by about $1.5 billion and closing out a year of record legal and litigation costs.

The proposed deal, which the bank announced in a statement Thursday, would be the latest multibillion-dollar settlement resulting from the government’s push to hold Wall Street firms to account for creating and selling subprime mortgage bonds that helped spur the 2008 financial crisis.

Authorities have already penalized the three biggest U.S. banks -- JPMorgan Chase & Co., Bank of America Corp. and Citigroup Inc. -- more than $37 billion in the form of cash and consumer relief. In those cases, the government said the banks misrepresented to investors the quality of mortgage loans they securitized into risky bonds.

New York-based Goldman Sachs will pay a $2.39 billion civil penalty, make $875 million in cash payments and provide $1.8 billion in consumer relief under an agreement in principle with a U.S. task force, according to its statement.

Read more: http://www.bloomberg.com/news/articles/2016-01-14/goldman-says-it-will-settle-u-s-mortgage-probe-for-5-1-billion

[Dems to Win]

1. Pocket change.

No justice for the millions who lost their home thru mortgage fraud.

[Spitfire of ATJ]

4. Why do I think the "$1.8 billion in consumer relief" is commercial property?

[anigbrowl]

13. Lovely attitude

I had a ringside seat on this case as several of my in-laws were working on the litigation during the discovery phase. People were working on this for years. Literally: litigation like this involves huge volumes of data, and if I remember correctly the CDO case had grown to over 10 million documents last time I checked. They'd get up every working day, spend the entire day tagging, classifying and indexing documents for this one case, day after day after day for several years. They were 2 among hundreds of people working to prepare this case for trial.

You may be dissatisfied with the outcome, but perhaps you could spare a thought for all the people busting their asses on your behalf for over 6 years for fairly modest pay.

[JoeyT]

21. Well, I'm not the one that posted that, but I share the attitude that it's pocket change.

But I certainly don't blame the people that do the grunt work. The person whose job it is to catalog and input documents for 10 hours a day isn't who decides what the law is, or how that law is enforced.

I'm sure a good many of them are also irritated that all their hard work ended in what amounts to a slap on the wrist for people that did so much damage.

[tk2kewl]

2. And how much did they make off the scheme?

[Spitfire of ATJ]

3. Is the 5.1 billion to STOP a probe?

[humbled_opinion]

5. The article should have finished with

$5.1 billion is not quite as much as their total campaign contributions last year.....

[allan01]

6. not one of them goes to jail.meanwhile in iceland

[elias49]

7. Where does that money go??

You read about these kinds of 'settlements' all the time...a billion here, 2.5 billion there...What happens to that (imaginary, I concede) money?

[FlatBaroque]

9. I don't know

but I can tell you for sure that it will not to the people who were harmed by the banksters.

[Bubzer]

8. How much of that are they going to be allowed to write off?

It very well may be a siphon of $37 billion from the taxpayer if they can write it all off.

[Mnpaul]

10. I do believe it's all of it or $2.39 billion

“Under current law, a corporation or individual business owner may deduct the cost of court-ordered punitive damages as an ‘ordinary’ business expense. For the victims of corporate wrongdoing, there is nothing ordinary about this,” Leahy said. “This tax loophole allows corporations to wreak havoc and then write it off as a cost of doing business. That undermines the whole point of punitive damages.”
http://www.leahy.senate.gov/press/leahy-calls-on-congress-to-close-tax-loophole-for-corporate-misconduct

[anigbrowl]

12. None, typically

Punitive fines are not tax-deductible. Deductible expenses must be 'ordinary and necessary'. Here's a legalese-free explanation for lay readers, but I am not going to answer follow-on questions about it as I'm going to watch the GOP debate.

[jeff47]

25. Actually, all of it. Because it's a settlement and not a fine. (nt)

[Mnpaul]

29. And two guys from Vermont would like to change that

we need to help them get it done. Let's see which other Democrats get on board.

[davidpdx]

17. That was the same question I was thinking of

[Ford_Prefect]

11. This isn't even pocket change for them. Goldman total assets were worth 856.24 billion in 2014.

Equity in 2014 was 82.797 billion. How much of that came from their manipulations? How much collateral damage did they do to investors and home owners not directly involved with Goldman or their arms-length subsidiaries?

And still not one senior or junior executive, account manager nor investment broker has done or will do hard time, or has lost their home or retirement funds, ill gotten profits or their license to practice. What do you have to say for yourself Mr. Holder?

[WestSeattle2]

14. Well that's about 1/20th of what they should be paying. Not to mention the prison

sentences that their most senior executives should be serving.

[Ferd Berfel]

15. UNTIL The CEO and Sr Managemetn start doing long jail time

It's just the cost of doing business.

And correct me if I'm wrong but when these corporate oligarchs 'pay' a fine', that a tax write-off. Meaning WE pay it for them.

[TeamPooka]

16. and no one spends one minute in jail for $5 billion dollars worth of wrongdoing. nt

[LittleGirl]

18. I know

it's b.s. absolute b.s.

[Jim Lane]

19. But, to be fair, none of them were selling loosies. (n/t)

[Agony]

30. Wait?

did you just suggest that the NYPD should not chokehold strangle all the banksters while taking them in to custody? …

Damn. there is no justice.

Cheers anyway.

[Jim Lane]

31. I oppose chokehold strangling any banksters who agree to rat out their bosses.

See, I have some compassion.

[Grins]

20. Does this mean fewer dollars for the Cruzs....?

Oh, no!

Oh, well. They're New Yorkers. Not "true" conservatives.

[harun]

22. Paying off the gov't and doing nothing to help the people

[Odin2005]

23. Chump change. "Just a cost of doing business".

[bkkyosemite]

26. Pay the fine then GO TO PRISON....

[Truprogressive85]

27. DOJ can prosecute FIFA excutives ,but not Big Bank ones ! justie my ass

And the people who lost their homes ?
get what nothing as usual

[SamKnause]

28. Who gets the 2.39 billion ?

My niece and I were just discussing who gets the money from all the fines

that are paid by all the corrupt and destructive corporations ???