Another Loophole for Corporate Fraud

Suppose that I’m the get-away driver for a bank robbery.I didn’t actually steal the money, but I certainly helped facilitate the theft.I would be categorized as an accomplice to the crime and subject to criminal prosecution.Furthermore, upon my conviction, the bank would be expected to try to recover the stolen monies (from the actual bank robbers and myself).This makes sense right?I enabled the theft and as such the bank has a right to try to recover its money from all those involved.

So why doesn’t this logic apply to corporate fraud?

Yesterday, the Supreme Court severely limited the ability of investors to sue businesses that helped hide the fact that corporate entities were cooking the books.The Court said that unless stockholders can show that they relied on the deceptive advice from these enablers to make their investment decision, they are up shit’s creek.So basically, a bank could help hide the fact that a company is really going bankrupt and profit from the investment into that company, without the fear of lawsuit; so long as they didn’t recommend that anyone buy that stock.

Now, I know that my bank robbery example isn’t the best metaphor, but there are some similarities.One company helped another hide its financial problems and, because of this court ruling, they cannot be sued by investors seeking to recover the money that was swindled from them.It’s like trying to say that the get-away driver shouldn’t be held accountable for the bank robbery.

The conservative majority on the court reasoned that the SEC and other government bodies should have the responsibility to pursue these enablers, rather than private litigants.Sure this logic makes sense in an ideal world; but in reality, the SEC has done next to nothing to fight against corporate fraud and its supporting actors. Thus, screwed-over investors have no recourse left but to go after these enablers in civil court. If a bank could prove that I was the get-away driver in a robbery but the cops didn’t care and wouldn’t prosecute me, you can be sure that they would drag me into civil court to recover their money (and would win.)

In this Supreme Court case, the SEC originally supported the plaintiff’s position that investors should be able to sue these enablers, but they were overruled by King George and his flunky for a Treasury Secretary, Paulson.They echoed the conservative mantra that lawsuits such as this destroy the economy and thus reinforce the notion that economics outweigh justice.

Since when is our Supreme Court supposed to weigh a case on the economic implications its potential verdict could produce?Have we forgotten that the courts are supposed to be a house of justice? Aren’t they supposed to leave economics to the economists?

What’s the moral of the story?You can help hide the bleak financial predicament of a publicly traded company, so long as you don’t tell people to invest in it.Lie, cheat, and steal and you’ll do alright in today’s America.

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Revolution at the Crossroads: Igniting the Socialist Resistance Against Trump

February 17, 2017 · $20.00 USD

Location: MayDay Space
Where: 176 St Nicholas Ave, Brooklyn, NY 11237
When: Friday, February 17th at 6 PM to Sunday, February 19th to 4 PM

Political Context

This Presidents’ Day weekend, the Young Democratic Socialists will gather for our annual winter conference in New York City titled Revolution at the Crossroads: Igniting the Socialist Resistance Against Trump. We did not choose the name lightly. In doing so, we call for leftists to collectively confront Trump and Trumpism at every possible opportunity. When a Trump administration attempts mass deportations of undocumented workers, when it attempts to register Muslims or roll back worker protections, when it attempts to take away reproductive, LGTBQ, civil, or any other rights, then we must militantly resist to prevent such measures.

To succeed, this must be explicitly socialist resistance. With liberalism having repeatedly shown itself incapable of combating the far right, it is now the time for socialists to openly declare our place in building the mass, multi-racial, and working class movement necessary for defeating the Trump administration. In this struggle, millennials will play an outsized role. That is why this conference comes at such a critical time—together we must create spaces for democratic and strategic discussion, spaces to gain organizing skills, and most importantly, spaces to form networks of young radicals for the future struggles ahead. These spaces will only come together if socialists come together. Join us this Presidents Weekend and help ignite the movement to defeat the Trump administration, continue the political revolution, and build the socialist alternative.

Key Deadlines

  • January 8th: Travel Scholarship for Air Travel (for application see below)
  • January 15th: Travel Scholarship for Non-Air Travel (ex: bus, car, train, etc.)
  • February 3rd: Early Bird Registration Ends - Tickets prices go up from $5 to $10
  • February 10th: Free Housing - We have limited free housing. You need to first register, then you will be sent an application for free housing.

Apply for a travel scholarship here! (First Deadline January 8, 2017)

Check out the working program (subject to change)