Washington, D.C., Feb. 11, 2011 The Securities and Exchange Commission today charged three former senior executives at IndyMac Bancorp with securities fraud for misleading investors about the mortgage lenders deteriorating financial condition.
The SEC alleges that former CEO Michael W. Perry and former CFOs A. Scott Keys and S. Blair Abernathy participated in the filing of false and misleading disclosures about the financial stability of IndyMac and its main subsidiary, IndyMac Bank F.S.B. The three executives regularly received internal reports about IndyMacs deteriorating capital and liquidity positions in 2007 and 2008, but failed to ensure adequate disclosure of that information to investors as IndyMac sold millions of dollars in new stock.
Yep. Just charge 'em in a civil case, sue 'em basically, and demand that they give back any money they made.
In the meantime everyone else who got cornholed as a result of listening to these chimps still lost their money. And incidentally, there's this guy over at OTS who helped them backdate capital, after doing the same damn thing at Lincoln Savings and Loan - you know, back in the S&L days?
Not only did he not go to prison the first time he didn't even lose his job until he did it again.
These corporate executives made false and misleading disclosures about IndyMac at a time when the companys financial condition was rapidly deteriorating. Truthful and accurate disclosure to investors is particularly critical during a time of crisis, and the federal securities laws do not become optional when the news is negative, said Lorin L. Reisner, Deputy Director of the SECs Division of Enforcement.
This, of course, is why there's a criminal indictment carrying 20 years in prison, right?
Oh wait.... there's not?
The SECs complaint against Perry and Keys seeks permanent injunctive relief, an officer and director bar, disgorgement of ill-gotten gains with prejudgment interest, and a financial penalty.
Nope, there's not.
Gee, I wonder why these sorts of things aren't crimes.....
Oh wait... they are under Sarbanes-Oxley, aren't they? Why indeed they are.
Hmmm..... the reason that there isn't a concurrent criminal complaint against these folks under Sarbox is?
I thought the entire purpose of Sarbanes-Oxley was to jail executives that made materially-false and misleading statements about the health of their company?
WHERE ARE THE DAMNED HANDCUFFS?
Where We Are, Where We're Heading (2013) - The annual 2013 Ticker
The content on this site is provided without any warranty, express or implied. All opinions expressed on this site are those of the author and may contain errors or omissions.
NO MATERIAL HERE CONSTITUTES "INVESTMENT ADVICE" NOR IS IT A RECOMMENDATION TO BUY OR SELL ANY FINANCIAL INSTRUMENT, INCLUDING BUT NOT LIMITED TO STOCKS, OPTIONS, BONDS OR FUTURES.
The author may have a position in any company or security mentioned herein. Actions you undertake as a consequence of any analysis, opinion or advertisement on this site are your sole responsibility.
Looking for "The Best of Market Ticker"? Check out Ticker Classics.
Market charts, when present, used with permission of TD Ameritrade/ThinkOrSwim Inc. Neither TD Ameritrade or ThinkOrSwim have reviewed, approved or disapproved any content herein.
The Market Ticker content may be reproduced or excerpted online for non-commercial purposes provided full attribution is given and the original article source is linked to. Please contact Karl Denninger for reprint permission in other media or for commercial use.
Submissions or tips on matters of economic or political interest may be sent "over the transom" to The Editor at any time. To be considered for publication your submission must include full and correct contact information and be related to an economic or political matter of the day. All submissions become the property of The Market Ticker.