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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsGoldman Mortgage Settlement Is Much Less Than Meets the Eye (NYTimes)
Goldman Mortgage Settlement Is Much Less Than Meets the EyeBy NATHANIEL POPPER
APRIL 11, 2016
http://www.nytimes.com/2016/04/12/business/dealbook/goldman-sachs-to-pay-5-1-billion-in-mortgage-settlement.html
But that is just on paper. Buried in the fine print are provisions that allow Goldman to pay hundreds of millions of dollars less perhaps as much as $1 billion less than that headline figure. And that is before the tax benefits of the deal are included.
The bank will be able to reduce its bill substantially through a combination of government incentives and tax credits. For example, the settlement calls for Goldman to spend $240 million on affordable housing. But a chart attached to the settlement explains that the bank will have to pay at most only 30 percent of that money to fulfill the deal. That is because it will receive a particularly large credit for each dollar it spends on affordable housing.
Goldman is the last of the major banks to settle with the government. Past deals with other banks also contained some of these concessions, but Goldman appears to have negotiated an even sweeter deal. For all the banks, the credits suggest that the amounts that the banks will have to actually spend on consumer relief will be much lower than the numbers announced in the news releases.
They appear to have grossly inflated the settlement amount for P.R. purposes to mislead the public, while in the fine print, enabling Goldman Sachs to pay 50 to 75 percent less, said Dennis Kelleher, the founder of the advocacy organization Better Markets, referring to the government announcement. The problem all along, with all of these settlements and this one highlights it even more is that they are carefully crafted more to conceal than reveal to the American public what really happened here and what the so-called penalty is.
DemocracyDirect
(708 posts)Enough is enough.
elljay
(1,178 posts)This is SOP for big corporate malfeasance. There is the announcement of the large fine, no one goes to prison, and the administration talks about how tough they were. Most news reports will never go beyond these highlights to mention that the large fines actually work out to proportionately be the equivalent of a parking ticket for the average American, and then there are tax deductions and other reductions. This is one reason some of us are not thrilled with Obama or the possibility of continuing his legacy. Some of us want a real progressive to at least try to tear apart this corrupt and rigged system.
gladium et scutum
(808 posts)should hire competent Legal Staff.
elljay
(1,178 posts)As well as competent investigative staff. The government has no interest in setting them loose. A few show cases are fine, but nothing to threaten the oligarchy.
rhett o rick
(55,981 posts)Government that Clinton wants to continue.
FailureToCommunicate
(14,014 posts)Geronimoe
(1,539 posts)With all the funding of politicans, there is no clear evidence the affects anyone.
They are just very giving when it comes to politicians.
cheapdate
(3,811 posts)We the people, however, have the power (in theory) to call bulls$&t and vote corrupt officials out of office. But that ship has sailed. The whole corporate-political system is so thoroughly corrupt and rigged that we couldn't vote them out if we wanted to. It's like trying to kill a hydra, you chop off a head and 2 more sprout in its place.
DemocracyDirect
(708 posts)Everyone needs to be reminded of this.
Kensan
(180 posts)If GS spends the money on providing new low-income housing, they deserve the same tax benefits that are available to any real estate developer engaging in these programs. The net effect is that disadvantaged folks will get the benefit of affordable housing that wasn't previously available. With what is happening to the cost of housing, these programs could use all the help they can get.
Where the outrage should be focused is on the civil penalty amount. That is where GS is paying pennies on the dollars of profit they made from these fraudulent transactions. Furthermore, the most outrage should be reserved for the fact that no actual person in authority at GS is being held accountable. The settlement clearly indicates fraud took place. That means there was intent to deceive. There should be perp walks all over the news.