Uniquely interesting commentary on the Goldman Sachs story by Sam Antar at White Collar Fraud. Sam Antar’s profile says he is a "convicted felon, former CPA, and former CFO of Crazy Eddie. There is a saying, ‘It takes one to know one.’" Sam teaches "law enforcement, government entities, professionals, businesses, and students about white collar crime and [he trains] them to catch corporate miscreants." He exposes white collar crooks "for fun and enjoyment." So read on for Sam’s perspective on the "Kiss of Death" the SEC delivered to GS. – Ilene
Did a Clever SEC Bait Goldman Sachs into Compounding Its Legal Problems With the "Kiss of Death" Message?
Courtesy of Sam Antar
The Kiss of Death
In filing its lawsuit against Goldman Sachs (NYSE: GS) on a Friday, the Securities and Exchange Commission sent what I call the "kiss of death" message to the embattled company. In other words, the SEC wanted to stick it to Goldman Sachs and Fabrice Tourre, the Executive Director of Goldman Sachs International, who is also a defendant in the complaint. While the SEC as a practice does inform target companies and individuals of an impending enforcement action, it does not always tell them exactly when such an action will be filed.
Apparently, the SEC filed its lawsuit without giving Goldman Sachs the heads up that it was planning to file it that day. Business Insider observed that Goldman Sachs was clearly unprepared to respond to the complaint as news of the lawsuit dominated the headlines all day. Goldman issued a short denial around noon and issued an extensive denial late in the afternoon, after most people had gone packing for the weekend.
When a company or individual receives a surprise subpoena on a Friday from the SEC, it is usually designed to ruin their weekend plans. Yes, the SEC can get personal in its own way.
Usually, corporate lawyers are unavailable on short notice to work weekends. When a company or individual receives a subpoena or lawsuit on a Friday, they are left to stew in anxiety over the weekend until Monday, before their lawyers can appropriately advice them on how to respond to the SEC.
