Wall Street Follies
This morning I came across an interesting piece about Wall Street’s recent PR flops in the Wall Street Journal’s “Deal Journal” blog. From the post:
It is official: Goldman Sachs is more important than you are.
At least that is the way that the public may perceive a WSJ story today that Goldman was one of several Wall Street firms that received large dosages of swine flue vaccines, while some New York City hospitals and clinics are running out of the vaccine…
The flu vaccine flap caps a week of PR nightmares for Wall Street.
First, there was news that Goldman was attempting to purchase low income housing tax credits, likely at a steep discount, from Fannie Mae. The deal could help Goldman offset its tax bill and satisfy its Community Reinvestment Act requirements, without creating any new affordable housing.
Later, we learned that Warren Buffett (who has advocated for higher income taxes) is also trying to snap up some of the credits that could allow him to reduce his corporate tax bill.
Yesterday the PR problems spread to the venerable Wall Street law firm, Ropes & Gray, where lawyer Arthur “Artie” Cutillo was charged as a ring leader in the burgeoning insider trading scheme. Cutillo is accused of leaking information about private equity buy out deals that Ropes & Gray was working on.
Last month, Ropes & Gray was criticized for stockpiling the antiviral medicine Tamiflu to help protect its employees from swine flu, despite the CDC’s request that the medicine be reserved for at-risk people.
Former federal prosecutor Robert Mintz says the zeal with which NY prosecutors and the FBI are pursuing the insider trading case is motivated by public angst about the financial crisis.
“People don’t trust Wall Street,” Mintz, who is now a white collar defense lawyer, told Deal Journal.
Weeks like this one aren’t exactly helping bridge the Main Street-Wall Street divide.
If there was a bridge, it was blown to smithereens a long time ago…
Source:
“You’re Not Worthy, But Goldman Is”
Wall Street Journal (Deal Journal blog), November 6, 2009
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