“Dennis Kelleher, president of Better Markets, a public interest group based inWashington, D.C., agreed with the jury.
“The message from this jury’s verdict is clear – until the SEC starts bringing cases against the real corporate wrongdoers and their executives, juries aren’t going to allow the SEC to scapegoat junior employees,” Kelleher said.
“The SEC charged a single mid-level employee for all of Citigroup’s derivatives misconduct leading up to the financial crisis. It did not charge any of the dozens if not hundreds of other involved employees, officers and executives. The SEC also let the corporation, Citigroup, off by settling with it for a puny penalty that was so small as to be irrelevant to Citigroup.”
At the time Stoker was charged, Citigroup was ordered to pay a $285 million penalty – without admitting or denying wrongdoing – an action that led Judge Rakoff to scratch the settlement.
“The jury obviously saw the unfairness in this highly selective enforcement of the law. This shows that the SEC’s practice of letting corporations and executives off without any meaningful penalties is fundamentally flawed. Mr. Stoker was one of dozens of Citigroup employees packaging and selling the $1 billion derivative, which Citigroup itself shorted and bet against,” Kelleher said. “The SEC’s practice of chasing minnows while letting the whales go must change if Wall Street’s pattern of breaking the law is to be stopped.”
Kelleher said that Better Markets objected to the paltry sweetheart settlement between the SEC and Citigroup in federal court in Manhattan last fall and will be filing its objections in the pending appeal of that settlement shortly.”
Read the full story from Corporate Crimes Reporter here.