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Obama accused of playing politics with the law over Goldman Sachs
Goldman Sachs was at the centre of a political storm last night as senior Republicans began an investigation into the possibility that the White House colluded with Wall Street's regulator over the decision to sue the bank for alleged fraud.They are demanding proof that the Securities and Exchange Commission (SEC) did not communicate improperly with the White House, the Democratic Party or any Democrats in Congress before suing the bank last Friday for allegedly withholding vital information from investors in the build-up to the crash of 2008. Wall Street and its allies have claimed with increasing anger that the Goldman suit was timed to help the Obama Administration to force Republicans into backing a financial regulatory reform Bill designed to prevent banking crises in the future. However, a letter addressed to the SEC's chairman yesterday, and seen by The Times, is the first formal accusation of wrongdoing by the commission or complicity by the US Administration. The timing of the lawsuit has created serious questions about the commission's independence and impartiality', the letter states. It was drafted by Darrell Issa, the ranking Republican on the House Committee on Oversight and Government Reform, and signed by seven other Republican members of the committee. The letter adds that subsequent revelations including details of a vote along party lines within the SEC to approve the lawsuit have fuelled legitimate suspicion' that the commission was trying to help the White House, breaching its own ethics guidelines in the process. Mary Schapiro, the SEC's chairman, who was appointed by President Obama, joined two Democrats on a five-member panel within the commission to approve the decision to sue the Wall Street powerhouse instead of seeking to settle out of court a more normal practice in such cases. In another break with convention, the bank says that it was given no clue' of the impending litigation. Posted by: tipper 2010-04-21 |
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