Posted on 08/18/2010 6:14:55 PM PDT by reaganaut1
Federal regulators accused the State of New Jersey of securities fraud on Wednesday for claiming it had been properly funding public workers’ pensions when it was not.
The Securities and Exchange Commission said the action was its first ever against a state, and only its second against any government over the handling of a public pension fund. The first was the city of San Diego. More may be in store; the agency announced in January that it had a special unit looking into public pension disclosures. The S.E.C. has been trying to assume more authority over municipal securities.
The commission settled its suit with New Jersey by issuing a cease-and-desist order, which the state accepted without admitting or denying the findings. No penalties were imposed.
Nor did the S.E.C.’s order name any individual state officials, nor the bond underwriters and other professionals whose job it was to vouch for the state’s financial statements. New Jersey’s largest bond underwriters during the period in question include Citigroup, J.P. Morgan Securities, Morgan Stanley, Bank of America, Merrill Lynch, Goldman Sachs and Barclays Capital.
The S.E.C. said its action was meant to dissuade other governments and their advisers from hiding bad fiscal news in a fog of pension numbers. Actuaries, for instance, have been raising questions about the framework Illinois has laid out for bolstering its pension funds. In New York, California and other places, financial advisers have told lawmakers that benefits could be sweetened at virtually no cost, only to be proved wrong once those benefits were adopted.
“Hopefully, it will send a message to other states or local governments,” Elaine C. Greenberg, chief of the S.E.C.’s municipal securities and public pensions unit, said in an interview.
(Excerpt) Read more at nytimes.com ...
Time to get the Gov.
I agree that it is hypocrisy but how is it securities fraud?
It’s securities fraud because Obama said so. The SEC is doing the Obummer’s bidding.
Remember, the SEC no longer has to respond to the FOIA requests do to the financial “reform” bill that passed. The same SEC that “missed” several ponzi schemes. And going after New Jersey? Why not New York, Illinois, California, etc? Could it be because someone is trying to clean things up just a little? Hmmmmmmmmmm......
Of course, they couldn’t do this when scumbag Corzine was in office.
They CHOSE to wait until a Republican who is actually trying to solve the fiscal problems CAUSED BY A LEFTIST SCUMBAG DEMOCRAT is in office.
What a surprise that this happened to a state with a Republican governor. The citizens of the 26 states that have Democrat governors* should feel slighted.
* for a list http://en.wikipedia.org/wiki/Democratic_Governors_Association
Ping...
No kidding!!! Like suing Arizona and denying aide to Republican states as well. We are watching evil running roughshod! I think we have a skinny hugo chavez running this country.
And how exactly is FedGov funding its logarithmic deficits?
Makes New Jersey look like frick’n Dave Ramsey.
This (and plenty else besides, such as money laundering and other mob activity) has been going on for years in NJ, and now there’s a problem? The response should be to eliminate state pensions.
I now see the rat plan to bailout public employee pensions. The federal government will claim state governments are guilty of security fraud. The federal government will essentially levy a tax on state residents to fund the pension plan.
If this form of taxation is legal, it seems that the federal government can impose taxes on state residents for almost any failing. If the federal government can fine a state government as though the state government is a financial services business, almost anything seems possible.
Florio borrowed a billion from the pension fund and never repaid it - Whitman borrowed two billion and never paid it back - McGreevy, Cotzine, and now Christie did not and will not contribute the state’s share to the fund even though the law requires these contributions - it’s nice to know such payments aren’t obligatory - next year, after this year buying a new car and sending some money to my aunt who’s having financial problems, I may just skip paying my state income tax since I’ll be short of funds by then - ignoring the law should work both ways it seems to me.....
Indeed. They're after Christie.
They know Christie won't go out of his way to deliver votes for the Dem's so they'll use him as cannon fodder. My gut tells me they might regret messing with Christie.
You’re right. Christie won’t let them get away with their usual emotional and insane arguments.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.