JOBS Act: Legalizing Fraud in the Stock Market?
Remember Yogi’s favorite line? Deja vu all over again. Well, guess, what, after all of that fraud occurring on Wall Street just a few years ago (and I thought I was suffering from short-term memory loss!), it’s deja vu all over again! Congress and the President just approved another loosening of Wall Street regulations, the JOBS Act, once again legalizing fraud in the stock market. Didn’t they learn anything from the economic devastation resulting from the repeal of Glass-Steagall other than that crime does indeed pay well?
Former SEC Chief Accountant Lynn E. Turner shared the following views on the JOBS Act: the Jumpstart Our Business Startups Act:
“…this bill will loosen IPO regulations for almost all IPO’s and for up to five years thereafter for those companies. It legalizes and allows research analysts to again engage in activities that were prohibited as a result of the dot com and wall street scandals and prohibits the SEC from taking action when they do so. It impedes the ability of the FASB and PCAOB to issue new standards. And it once again opens up even more broadly the general solicitation of the public, including the elderly wealthy such as those who invested in Madoff and Stanford Ponzi schemes.”
“This is a great example for students in the class room as to how sausage and legislation is made in Washington DC., especially when it benefits special interests groups.”
Haven’t we learned by now that the loosening of investment protections would expose small and inexperienced investors to fraud. Does anyone actually believe that the way to create jobs is to weaken regulatory protections? But look at the deceit so apparent in this legislation: it is called a JOBS Act. Jobs Act? We all know by now that the cliche, “create jobs”, are code words for “more tax breaks or monies for the 1%”.
Various criticisms of the JOBS Act include: “Gutting regulations designed to safeguard investors”; “legalizing boiler room operations”; relieving “businesses that are preparing to go public from some of the most important auditing regulations that Congress passed after the Enron debacle”; and “a terrible package of bills that would undo essential investor protections, reduce market transparency and distort the efficient allocation of capital”.
As a Certified Public Accountant, I confess that I am at a total loss in understanding how exempting companies from audited financial statements for up to five years is good for investment? Would you be more likely to invest in startup companies, no less, without assurance that their numbers were not works of fiction? Hello?
For more critical scrutiny of the JOBS Act, please see: JOBS Act: Jumpstart Our Business Startups Act. Legalizing Fraud in the Stock Market.
Incidentally, has Elizabeth Warren commented on this JOBS Act yet? Does anyone know what her opinion of this Act is? Strange that when I googled her for a comment, I couldn’t find anything. Is she remaining silent because of political reasons? Et tu, Brutus?
Once again, I am at a loss why members of my generation have been so silent and complaisant on this issue, the fraud of the subprime/derivative crisis, and the Occupy Wall Street movement. Did they all die and go to that great big country club in the sky?
I applaud and thank the youth for risking arrests and physical abuse from the police. Have you seen the police clubbing and macing the youth? Our country has become a police state. I salute Occupy Wall Street.
Regulations need to be tightened, not loosened, on Wall Street. And Glass-Steagall needs to replace that watered-down Dodd-Frank Bill that is riddled with so many holes that it’s now as porous as Swiss cheese.
Where is all that hope and change, change you can believe in, and change the way Washington works that candidate Barack Obama promised in 2008?! Why are all the other Democrats silent on these issues? Where is the moral outrage? And why has Elizabeth Warren suddenly become a mute on this issue? It can’t be because of all the political contributions from Wall Street, can it? LOL!
What a bunch of paid-off crooks in Washington. How are political contributions and lobbyists monies different from legalized bribery? We talk about the Mafia as representative of organized crime. But it is okay for the financial industry to defraud the American taxpayer out of trillions of dollars? And the $25 billion settlement for the blatant fraud involved in robo-signing (i.e., the perjury and falsely attested-to statements by bank document custodians, the selling of dubiously documented accounts to debt collection companies, etc.) is pennies on the dollar that would result from lawsuits from our pension fund institutions.
Not one crook from the subprime fraud was ever indicted or imprisoned. The system is so corrupt that it is beyond repair. Obama promised to address all of this Wall Street fraud, appointing Eric Schneider to investigate its recent actions in the mortgage fiasco. But why have only 55 FBI agents been assigned to the biggest heist in the history of the world?! Enron alone was assigned 100 FBI agents; the Savings and Loan crisis was assigned 1,000 FBI agents. And Obama assigns only 55 FBI agents?! Why bother assigning 55: just assign a token one FBI agent and call it a done deal.
Our forefathers took up arms over a mere tea tax. What will it take for the American people to demand an end to all of this fraud now? We cannot change it by voting since the Democrats are on the corporate payroll as well as the Republicans, and most of the justices on the Supreme Court are paid mouthpieces of Corporate America. Does Citizens United ring a bell?
I have been waiting for change for thirty years, and I am 64 years old, so I cannot wait another thirty years. I had thought Barack Obama was the real thing. Wow, was I stupid and naïve. Things are getting worse and worse, and now we are going back to the days prior to the New Deal.