House bill would steer Wall Street fines away from states

[BuckeFushe]

http://www.usatoday.com/news/washington/2003-07-09-morgan_x.htm

House bill would steer Wall Street fines away from states

Just three months after state regulators forced them to pay $1.4 billion to settle charges of deceiving investors, Wall Street's biggest firms are striking back, supporting a new bill in Congress that would eliminate financial incentives for state regulators.

The new House bill, sponsored by Rep. Richard Baker, R-La., calls for future fines and penalties against Wall Street giants to be paid to the Securities and Exchange Commission. The SEC would then return the cash to defrauded investors. By contrast, a large chunk of April's $1.4 billion settlement will go to the states, which are desperate for funds.

Several state regulators see the new bill as a veiled attempt to short-circuit future investigations of Wall Street firms.

"This is nothing more than a direct attack on state securities regulators, without whom there would have been no meaningful action against the investment banking firms that engaged in the largest financial fraud in American history," says New York Attorney General Eliot Spitzer.

Congressman Barney Frank, D-Mass., agreed. "If it weren't for the states, there wouldn't be any money. This is revenge by some of the people on Wall Street on Eliot Spitzer. This is an attempt to knock the states out of the business of regulating investment banks."

Much more..................

And guess who has been Baker's largest corporate PAC contributors (opensecrets.org.):

Morgan Stanley
Wells Fargo
jP Morgan Chase & Co
Adams & Reese
American Bankers Assn
American Council of Life Insurers
Bank One Corp
Credit Suisse First Boston
Credit Union National Assn
FedEx Corp
Household International
Mortgage Bankers Assn of America
Wachovia Corp
Independent Insurance Agents of America
Entergy Corp
Investment Co Institute
American Express
KPMG LLP
Bank of America
BellSouth Corp
Prudential Financial

And here's the breakdown from the 2002 Election cycle by industry and total contributions:

1 Insurance $113,631
2 Commercial Banks $100,500
3 Securities & Investment $89,999
4 Real Estate $47,800
5 Finance/Credit Companies $41,500

Sector - Total - PACs - Indivs
Finance/Insur/RealEst $450,058 $413,508 $36,550

Gee, that smell, it has the stench of paying off for past favors. Don't you smell it?