Friday, August 2, 2013


I'm trying to restrain myself from suggesting metaphorically what a Goldman Sachs swimming pool might be filled with.

Tonight, alas, it would be full of glee after attorneys for both sides in the Fab Tourre case conspired to keep some of their executives and one of their biggest clients out of prison.

Oh, yes, lead prosecutor Matthew Martens did denounce "greed on Wall Street," (curse that pavement!) and even convinced several jurors that Tourre's crimes were committed as a cog in the Goldman Sachs machine (how about prosecuting them, Goldman and Sachs? Oh, they're dead.).

But they concluded that he was a "willing cog," and so bore responsibility for his sucker-cheating salesmanship.

All the jurors, or the 5 out of 9 who spoke to the NY Times, seem to have gotten it, Vice President Tourre was really a small fish.

Prosecutors like Martens' boss, Mary Jo White, now the chairman of the SEC. but for several very productive years, the US Attorney for the Southern District of NY, know what you do with small fish like Veep Fab. You flip them, you turn them, you offer them mitigated justice to get their help in frying the big fish, the people for whom Fabrice Tourre's $1.7 million year, the evidence Martens offered of his greed, is lunch money.

Not doing so is called taking a dive. Nice bathing cap, Ms. White.

At Goldman Sachs every cog knows the driving wheels. At Goldman Sachs, Vice President Tourre did not create the stinking financial product, the plastycene property procurement package, or whatever he and the shysters call it, but he knows who did. Common knowledge, for whatever that's worth, always credits the hedge fund hog John Paulson with designing the dishonestly described, "you lose so I can win," product. It is certain he did win, the Washington Post reports, roughly $1 billion.

Goldman Sachs' cut? (Not for the dead guys, but maybe for their descendants, as well some few of their top employees.) $15 million, reports the Post.

And speaking of those top employees who towered above Fab in the GS family tree, surely some of them knew about what John Paulson had dreamed up, and some of them knew exactly what Tourre was doing. And Fab knows their names, and knows what they said and did to authorize and promote the toxic investment. Did SEC Chair White, who congratulated Martens and his team and the office staff, caterer and loyal, patient spouses and children at home for crushing this cockroach, ever suggest that her prosecutors try to turn Fab from defendant to prosecution witness? After all, what Fab Tourre knows is evidence of not just million dollar civil fraud, but billion dollar criminal conspiracy to cheat and defraud. As a judge would say, "I see no evidence" that she did.

I do see tracks. This is Martens' last case for the SEC, the NY Times reports, he's already told White he's out, on his way to 2, as the Times called them, "white shoe law firms." You know, the kind of attorneys who defend outfits like Goldman Sachs. Well, at the least, you'd have to say, "He didn't scare off any clients."

His dive was so perfect, he hardly made any wake in the pool. Just white shoe tracks.

Now, since Martens repeatedly kept his courtroom focus on Wall Street greed, and since even he didn't have the nerve to over-estimate the 28 year old Vice President's magnitude as a greedhead, you might think he'd want to spell out a few of the whos and hows of the greater greedians who run the rat race in which Tourre played The Fabulous Rodent, so that jury might better understand the reality of this case. When Fab Tourre lied through omission, it was called fraud; when Matt Martens did the same, it is called, admiringly, "building a case."

But if, in a sense, it was Martens' job to keep his focus strictly on the defendant, you might think it was Fab's lawyer's job to deflect or diffuse the spotlight from the defendant's well-documented sales tricks by putting them in the Big Context in which he was a small "cog."

"Where did this package come from? Who benefited most from it? Are they the same guy? What's his name again? John Paulson?"

"And, again, Mr. Tourre, how did this assignment come to you? Was it something you and Mr. Paulson together 'helped to create?' (Don't you love that phrase used by both lawyers and newsmen to describe the connection of both men to Abacus 2007-AC1, a.k.a. "the sack of shit.") Did anyone else "help" you? Anyone at Goldman Sachs? By the way, Mr. Vice President, to whom do you report? What's your chain of command at Goldman? Did the guy one up from you know what you were doing? How 'bout his boss? Oh, yeah, and what are their names?

"And you made $1.7 the year to perpetrated this fraud, what did your boss make? And what did his boss make? And the Big Boss. what's his name? Lloyd Blankfein?  What did he make that year? His title, Mr. Vice President, was CEO and Chairman of the Board. So, did he have any role in, or knowledge of, this operation? Do you know whether Mr. Blankfein and Mr. Paulson know one another?"

But defense attorney John (Sean) Coffee, publicly hailed as a "Superlawyer," didn't ask his client about any of that. In fact, he didn't call him as defense witness at all, so happy was he with his work counter-punching against the prosecution's interrogation that convinced the jury to convict Tourre.

Even jurors were shocked at that. Like, it seems, everyone in the courtroom, they had found Fab's answers to Martens' question credible and likable. It made them, several said, sympathetic, and they were surprised and disappointed --several jurors said this -- that they didn't hear him give more of his side of the story.

But his own counselor counseled him to stay silent.

Splish splash. The defense counsel takes a dive.

John (Sean) Coffey represents the very opposite of a white shoe law firm. In addition to having his own John Coffee brand law shop, he is, says his LinkedIn account, Managing Director and Co-founder at BlackRobe Capital Partners, LLC. I mean no one dressed up in black robes would do white shoe work for Goldman Sachs, would he? Oh, he does? The investment bank is paying all of Coffee's fees? Damn right they are.

And for Goldman Sachs, and Blankfein, and his many Executive and Senior and Special Vice Presidents, Fab's silence was golden.

Maybe not the best thing for Fab, certainly not the best thing for anyone who has any dealings with Goldman or Paulson or "greedy" Wall Street in general, or anyone who just cares about ethics and fairness in American justice and commerce, not such a good deal for them, us.

But it is the watchword of our times: "You get what you pay for."

Splish splash.  Silence.


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