Arrested: 1 Ex-Goldman Director, 2,511 Protesters

Posted by: Mark Gimein on October 26, 2011 at 1:10 PM

rajat_gupta_600.jpg
The world is calling for the heads of bankers, and the FBI has delivered them Rajat Gupta. He’s not precisely a banker, but Gupta did sit on the board of Goldman Sachs—a position that allegedly let him tip off hedge fund manager Raj Rajaratnam to Goldman’s share moves.

This arrest might feel like it’s coming from a very old playbook. The revelation that Chase Bank head Albert H. Wiggin shorted his own company’s stock (it wasn’t illegal then) caused a scandal after the 1929 crash. The 1987 crash brought in a famous crop of insider trading arrests, including that of Goldmanite Robert A. Freeman, which remains controversial.

This arrest and the conviction of Rajaratnam stand out amid the paucity of criminal charges against senior executives linked to the main substance of the banking crash, the millions of bad mortgages underwritten by banks, repackaged and sold off to investors. One point of comparison here is the protesters’ count of arrests at Occupy Wall Street demonstrations around the country. That now stands at 2,511.

(Photographer: Eric Piermont/AFP/Getty Images)

Reader Comments

Point Noted

October 26, 2011 2:06 PM

When some smart butchers and cattle farmers started mixing the viscera of cows instead of disposing of their remains, Mad Cow Disease was born.

Our brilliant Wall Street figures decided to feed mortgage based securities to the same population that took the mortgage which was packaged in perhaps their 401K basket and other "Mutual Funds" which were "managed" by these cleaver folks.

So now we are all running around like mad cows. But some people did make hay when the sun was shining. Took a bail-out when its not. What a risk free high Return on Investment concept!!

CallMeBC

October 26, 2011 2:08 PM

A 2500/1 arrest ratio of protesters to the people who caused the global financial meltdown? Gawd....well, at least we don't still have Iron Maidens and stake burnings, so law and justice have improved a little bit over the centuries, I guess.

jen powers

October 26, 2011 2:11 PM

what three words best describe Rajat Gupta? http://littlebiggy.org/4671787

Pilau

October 26, 2011 2:48 PM

If Obama gets re-elect, he needs to start the investigation of all of the banks and wall st. It wasn't the right time in O9 because of the mess we were in. But, this has to be done for the future of this country.

sam

October 26, 2011 2:53 PM

He should sure suffer for what he did. But he's just an easy (minority) scapegoat in the current political climate with OWS everywhere - he had nothing to do with financial crisis of 2008.
Lloyd Blankfein is the real bastard - but ofcourse, why will the authorities nab him. He's an insider ... if he goes down so do a lot of SEC executives and politicians along with him ...

nikko

October 26, 2011 3:19 PM

How many went to jail for the Enron scandal? So this guy was picked as a scapegoat to make us peasants think we have real justice. He'll likely be the last.

Mashcode

October 26, 2011 3:32 PM

Don't count on it Pilau http://www.opensecrets.org/pres12/contrib.php?cycle=2012&id=N00009638
Goldman and BofA rank high

Martin

October 26, 2011 4:55 PM

They already did a very detailed investisgation of Wall St. and the reason there have been so few arrests and fines is because very few laws were broken. The reason for that is that the laws were written by people that used to work on Wall St. Many people who retire from Wall St. after making a fortune move into politics, either by getting elected to office or being an advisor to elected officials. We keep expecting them to plug the loopholes in the Laws that they profited from, but it hasn't happened yet.

Thom

October 26, 2011 7:17 PM

Except for Martin's comments, there are some very misinformed comments being made. I would even take it a step further and say there's a very big difference between making very bad business decisions (driven be shareholder pressures, which is still not excusable) and knowingly/intentionally committing fraud.

larkforsure

October 26, 2011 7:48 PM

[ SOS ] Complaint about Human Rights Violations by IBM China on Centennial

Please Google:

IBM detained mother of ex-employee on the day of centennial
or
How Much IBM Can Get Away with is the Responsibility of the Media
or
Tragedy of Labor Rights Repression in IBM China

you have to be kidding...

October 27, 2011 9:14 PM

I would say forging thousands of mortgage documents would be criminal. There are plenty of targets the authority could go after such as Mozilo but theres a reason the financial sector is the top contributing lobby.

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About

"The Wealth Debate" is a running discussion of wealth, poverty, the economy and income inequality in the U.S. and the world. It was started shortly after the Occupy Wall Street movement sparked a global protest about the fallout from the financial crisis and money in politics. You can reach the editors, Dan Beucke and Mark Gimein, by email, or follow BloombergNow on Twitter to keep up with posts.

Analyses or commentary in this blog are the views of the author and or commentators, and do not necessarily reflect the views of Bloomberg News.

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