Breaking News NYTimes **Correction** just breaking now

[Mira]

Breaking News Alert
The New York Times
Monday, November 28, 2011 -- 1:00 PM EST
-----

Federal Judge Blocks Citigroup’s Mortgage Settlement With S.E.C.

Correction: An earlier e-mail alert misstated the size of the settlement. It was for $285 million, not $28 million.

A federal judge in New York on Monday threw out a settlement between the Securities and Exchange Commission and Citigroup over a 2007 mortgage derivatives deal, saying that the S.E.C.’s policy of settling cases by allowing a company to neither admit nor deny the agency’s allegations did not satisfy the law.
The judge, Judge Jed S. Rakoff of the Federal District Court in Manhattan, ruled that the S.E.C.’s $285 million settlement, announced last month, is “neither fair, nor adequate, nor in the public interest” because it does not provide the court with evidence on which to judge the settlement.
The ruling could throw the S.E.C.’s enforcement efforts into chaos, because a majority of the fraud and other cases that the agency brings against Wall Street firms are settled out of court, most often with a condition that the defendant does not admit that it violated the law while also promising not to deny it.

Read More:
http://www.nytimes.com/2011/11/29/business/judge-rejects-sec-accord-with-citi.html?emc=na

[drm604]

1. Even better.

[Historic NY]

2. Makes you wonder just how much $$$ was involved if they would settle for $285 million...

a trial would mostly likely yield a higher return to the public.

[eppur_se_muova]

5. ... and if the JUDGE ruled that amount "neither fair, nor adequate"! nt

[dixiegrrrrl]

3. nice to see the tide turning.

Perhaps it is a new morning .............

[firehorse]

4. Hope this judge isn't forced into early retirement

[toddwv]

6. The appeal to the SCOTUS will probably end up with the decision being vacated.

I'm thankful that there is at least one judge that isn't afraid to stand up for justice:

"Judge Rakoff also refers at one point to Citigroup as “a recidivist,” or repeat offender, which has violated the antifraud provisions of the nation’s securities laws many times. The company knew that the S.E.C.’s proposed judgment – that it cease and desist from violating the antifraud laws – had not been enforced in at least 10 years, the judge wrote."

"Investors lost $700 million in the fund, according to the S.E.C., while Citigroup gained about $160 million in profits. "


Bravo, Judge Rakoff, BRAVO!