Saturday, February 13, 2010
Another SEC Nothingburger-2
"A reinsurance firm owned by Warren Buffet's Berkshire Hathaway Inc. reached a $92 million settlement with the federal government that will allow the firm to avoid prosecution for its role in a fraud scheme involving [AIG]. As part of the deal, Berkshire agreed to several coporate-governance concessions. ... It will also pay $12.2 million to settle charges by the [SEC] in connection with the fraud and for helping another company falsify its reported financial reults. ... Several former GenRe executives, including Ronald Ferguson, the former chief executive, and Elizabeth Monrad, the former chief financial officer, were convicted in 2008 on charges that in 2000 and 2001 they helped AIG--which was then a client--improperly inflate its loss reserves, a key indicator of financial health, by $500 million", Amir Efrati at the WSJ, 21 January 2010:
Corporate governance is a scam. This is another joint SEC-DOJ failure to enforce the law.