|Lots happened in the last month from the Senate confirmation of nominees to the Federal Reserve Board (including the historic confirmation of the first Black female to serve on the Board) and a lively video AMA (ask me anything) on r/superstonk to yet more Wall Street crime and protecting consumers while insisting on accountability.
First, the U.S. Senate has finally confirmed Lael Brainard as Vice Chair of the Federal Reserve Board. During the past eight years as a Governor of the Fed she has been an effective, consistent, and steadfast defender of the critical financial protection rules necessary to protect Main Street families, our financial system, and the entire economy. As Vice Chair, we are confident she will continue her tireless efforts to put the public interest first.
Unfortunately, baseless Republican obstructionism continues to delay the confirmation of other key nominees. Republicans’ latest tactic was to use the COVID-19-related absences of Senators to sidetrack the historic nomination of the highly qualified and deeply experienced Dr. Lisa Cook as a Fed Governor, and to further delay the confirmation of Dr. Philip Jefferson and Chair Jay Powell. Hopefully, they too will be confirmed soon.
Second, I recently did a video AMA with the subreddit r/superstonk. The discussion covered everything from the GameStop trading frenzy, short-sellers, Robinhood, and Citadel to the founding of Better Markets and why/how people should get involved in the Washington DC policymaking process, including regarding the rules that rig the markets against retail traders and the buy-side. You can watch the entire video here or view particular topics here.
Third, as our reports have demonstrated in the past, lawbreaking in finance and particularly at Wall Street’s largest banks is so common that one could think it is part of the business model. The latest, egregious reminder of that was the trial of former Goldman Sachs’ junior partner Roger Ng, who was convicted of committing numerous crimes in connection with the global money-laundering and looting scandal of a Malaysian development fund known as 1MDB.
Goldman Sachs’ years-long involvement with 1MDB was indispensable and enabled the global crime spree, as detailed in this report. Moreover, Goldman isn’t a first-time offender; it is a lawbreaking recidivist. Yet, DOJ cut a sweetheart settlement deal with Goldman and prosecuted just one junior partner after getting a plea from his supervisor, even though more than 30 Goldman executives were involved with 1MDB and there were numerous red flags that should have stopped the crime spree from happening. This is a grossly inadequate response by the DOJ to “one of the greatest financial heists in history” that egregiously corrupted democracy in an entire country.
DOJ’s highly selective (non)prosecution reaffirms the belief that on Wall Street crime pays, even at such a global scale, has minimal consequences and, even then, almost only for the most junior people.
Finally, in recent weeks we took important steps to help protect consumers and demand accountability. Our team has filed a flurry of comment letters encouraging the SEC and others to take action on issues like making money market funds more transparent and resistant, protecting consumers from billions in fees, and strengthening the whistleblower program designed to prevent the next financial crisis. We also released a major report on the dark and mostly unregulated private securities market, which is expanding at the expense of the transparent, regulated, and broadly accessible public securities market.
In a welcome piece of good news, we celebrated the U.S. Senate’s confirmation of Judge Ketanji Brown Jackson to the U.S. Supreme Court. As we explained in our March 15th report, we are confident that Justice Jackson will provide everyday American consumers and investors a fair hearing and a fighting chance when they are pitted against a powerful and too often predatory financial system that enriches itself at the expense of the real economy.
Thank you for all you do to support our organization and its work.
Co-founder, President, and CEO, Better Markets
ICYMI: Last month, the long-awaited HBO MAX two-part documentary Gaming Wall Street, premiered, with the work of Better Markets highlighted throughout. The documentary explores the GameStop trading frenzy and its aftermath. Watch it on HBO Max.