<div class="KonaFilter image-container float_right"><div class="image on-image"><img src="http://static1.businessinsider.com/image/51e447066bb3f73c64000004-1194-896/screen-shot-2013-07-15-at-30023-pm.png?maxX=480" border="0" alt="Screen Shot 2013 07 15 at 3.00.23 PM" width="480" />REUTERS/Lucas Jackson</div></div><keyword id="144459" type="PERSON" weightage="60" keywordseo="Fabrice-Tourre">Fabrice Tourre</keyword>, the former Goldman Sachs trader found liable of six counts of <keyword id="585002" type="UNKNOWN" weightage="60" keywordseo="securities-fraud">securities fraud</keyword>, has <a href="http://dealbook.nytimes.com/2013/10/01/fabrice-tourre-seeks-a-new-trial/?smid=tw-dealbook&amp;seid=auto">requested a new trial</a>.
In August, the <keyword id="6362470" type="ORGANIZATION" weightage="60" keywordseo="SEC">SEC</keyword> convinced a jury that Tourre misled investors regarding a pre-crisis mortgage-backed securities deal.
The <a href="http://dealbook.nytimes.com/2013/10/01/fabrice-tourre-seeks-a-new-trial/?smid=tw-dealbook&amp;seid=auto">New York Times' Susanne Craig reports</a> that Tourre's lawyers have filed a motion citing a lack of evidence. They are asking a federal judge to give Tourre a new trial or throw out the charges against him. <a href="http://dealbook.nytimes.com/2013/10/01/fabrice-tourre-seeks-a-new-trial/?smid=tw-dealbook&amp;seid=auto">From the Times</a>:
Mr. Tourre received an annual base salary and bonus during his years at Goldman. His lawyers said no evidence was presented to show his compensation was linked to the transaction at the heart of the case, and in fact "the only logical inference from the evidence was that his bonus was likely lower" at one point because Goldman had a piece of the trade that lost money.
The jury, during deliberations, asked about Mr. Tourre's compensation and Mr. Tourre's lawyers said the jury "incorrectly concluded" that the trader's base salary was sufficient to fulfill the requirements needed to return a finding of liable.
Tourre has been described by many as a patsy, a fall guy for Wall Street's pre-crisis sins. Though he worked at Goldman, he was a small cog in an economic machine that fueled a mortgage bubble (there are tons of "vice presidents" on Wall Street). 
Still, the case became one of the government's highest profile attempt to prosecute those culpable for the <keyword id="6371665" type="UNKNOWN" weightage="60" keywordseo="financial-crisis">financial crisis</keyword>.
<a href="http://dealbook.nytimes.com/2013/10/01/fabrice-tourre-seeks-a-new-trial/?smid=tw-dealbook&amp;seid=auto">Read the full report at the New York Times &gt;</a>

Ex-Goldman Trader 'Fabulous Fab' Tourre Is Seeking A New Trial

<div class="image-container float_right" style="width:480px"><div class="image"><img src="http://static1.businessinsider.com/image/51e447066bb3f73c64000004-1194-896/screen-shot-2013-07-15-at-30023-pm.png?maxX=480" border="0" alt="Screen Shot 2013 07 15 at 3.00.23 PM" width="480" />REUTERS/Lucas Jackson</div></div>Coverage of the <keyword id="144459" type="PERSON" weightage="60" keywordseo="Fabrice-Tourre">Fabrice Tourre</keyword> trial was stuffed with language about how the jury was either <a href="http://www.reuters.com/article/2013/07/19/us-sec-goldman-tourre-idUSBRE96G19720130719">too bored</a> or too stupid to really understand the case.
"Some members of the nine-person jury appeared to fall asleep as one expert witness testified to the ins-and-outs of the deals," Tracy Alloway <a href="http://www.ft.com/intl/cms/s/0/bf88aa8e-fa27-11e2-98e0-00144feabdc0.html#axzz2bTYl4RV4">reported in the FT</a>. "Another witness who participated in Mr Tourre’s transaction said he could not recall what the term 'CDO' stood for."
It was for these reasons, some observers argued, that Tourre was martyred for a financial crisis in which he was just a small cog. 
<a href="http://www.npr.org/blogs/money/2013/08/09/210331714/tourre-juror-we-saw-goldman-as-the-bigger-problem">But NPR's Planet Money tracked down two of the jurors</a>, an Episcopal priest and a man who works in the film industry, and they actually had some shrewd things to say about the trial (and, now out of sequester, they took issue with some of the media coverage).
"We didn't feel any malice towards him. We felt sympathy at times," juror Dylan Maxwell told NPR. "We saw Goldman as the bigger problem. And the whole system as a bigger problem."
If they looked sleepy, Maxwell said, it was simply because of the droning protocol of the legal process — the same emails read over and over again to new witnesses offering monotonous responses. 
"The problem with just going after Fabrice Tourre or going after the different sort of Fabrice Tourres that are in all of these banks is that it doesn't change the system," said Beth Glover, another juror. "At least not enough."
But they had to deal with the case at hand.
<h4><a href="http://www.npr.org/blogs/money/2013/08/09/210331714/tourre-juror-we-saw-goldman-as-the-bigger-problem">Check out the full interview over at NPR's Planet Money&gt;</a> </h4>

JURORS IN THE 'FABULOUS FAB' CASE: 'We Saw Goldman As The Bigger Problem'

<div class="image-container float_right" style="width:480px"><div class="image"><img src="http://static4.businessinsider.com/image/51fbfcfeecad040317000006-1200-924/fabrice-tourre-1.jpg?maxX=480&amp;maxY=360" border="0" alt="Fabrice Tourre" width="480" height="360" />Associated Press/Louis LanzanoFormer Goldman Sachs Group Inc. executive <keyword id="144459" type="PERSON" weightage="60" keywordseo="Fabrice-Tourre">Fabrice Tourre</keyword>, right, enters Manhattan federal court on the first day of his trial, Monday, July 15, 2013, in New York</div></div>Fabrice Tourre, an ex-Goldman Sachs VP <a href="http://www.businessinsider.com/henry-blodget-so-this-is-why-goldman-paid-fabrice-tourre-2-million-in-2007-2010-4">who made $2 million</a> when he was just 28, was found liable for fraud after his lawyers used a strategy some legal experts called very risky.
His lawyers didn't call a single witness to defend him in the SEC's civil case accusing him of misleading investors in a mortgage deal called Abacus 2007-AC1.
The young Tourre, who was the only Goldman exec to go to trial over the deal, has been <a href="http://www.bloomberg.com/news/2013-08-01/fabrice-tourre-verdict-leaves-sense-of-missed-opportunity.html">called a mere "cog</a>" in the Goldman machine.
Many lawyers predicted the SEC would <a href="http://online.wsj.com/article/SB10001424127887323681904578641843284450004.html">lose the case</a>.
"Mr. Tourre’s lawyers put on the Arthur Fonzarelli defense — “<a href="http://www.youtube.com/watch?v=yyzK6e6py9A">Aaaayy</a>” — by resting without calling any witnesses. <a href="http://dealbook.nytimes.com/2013/08/02/the-penalties-and-possible-appeal-for-fabrice-tourre/?smid=tw-share">This is a high-risk strategy</a> that tells the jury the opponent’s case is so weak that the opponent need not deign to respond," <a href="http://law.wayne.edu/profile/peter.henning2/">law professor Peter Henning</a> wrote in The New York Times on Friday.
However, Tourre's lawyers — <a href="http://dealbook.nytimes.com/2013/07/15/arsenal-of-legal-firepower-masses-around-tourre-trial/">a high-power team</a> bankrolled by Goldman — probably had some good reasons for deciding not to call a single witness. For one thing, the SEC's lawyers would have cross-examined any witnesses the defense put on the stand.
"It is not unheard of that a defense witness does more harm than good for your case," white collar defense lawyer <a href="http://www.bipc.com/barry-i-slotnick/">Barry Slotnick</a> told Business Insider.
The other reason Tourre's lawyers didn't call any witnesses is because Tourre himself was called to the stand by the SEC. The government can't force defendants to testify in criminal cases, but it can in civil ones like the fraud case brought against Tourre.
Since he was technically the government's witness, Tourre's lawyers were able to make their case by "cross-examining" him, says <a href="http://www.btlaw.com/solomon-l-wisenberg/">Solomon Wisenberg</a>, co-chair of the white collar defense group at Barnes &amp; Thornburg.
"Obviously, they thought he was their best witness," Wisenberg told BI.
It's impossible to know whether his lawyers' decision not to call any defense witnesses (Tourre was a prosecution witness) was to blame for the outcome of the case.
"There is no question that the economic climate and the prevalent anti-business attitude played a part in the verdict," Slotnick says. "We expect an appeal."
Because this is a civil case, Tourre does not face any jail time. He could be barred from the securities industry, though, and have to pay hefty civil fines.

Why Lawyers For 'Fabulous Fab' Didn't Call A Single Witness In His Huge Fraud Case

<div class="image-container float_right" style="width:480px"><div class="image"><img src="http://static1.businessinsider.com/image/51fab8ea6bb3f75449000002-750-562/fabrice-tourre-fabulous-fab-2.png?maxX=480" border="0" alt="fabrice tourre fabulous fab" width="480" />Reuters/Lucas Jackson</div></div>Former Goldman banker <keyword id="144459" type="PERSON" weightage="60" keywordseo="Fabrice-Tourre">Fabrice Tourre</keyword> 'The Fabulous Fab' has been found guilty of 6 of 7 counts of securities fraud surrounding the bank's notorious $1 billion Abacus subprime mortgage CDO deal, the Bloomberg reports.
Goldman, for its part, has already settled charges related to this case without admitting or denying wrongdoing for $550 million.
Tourre was accused setting up a trade that was meant to fail, and of misleading investors about the nature of hedge fund manager John Paulson's involvement and position in the deal, among other things.
Tourre has yet to be sentenced, but it's likely that the SEC will seek to bar him from the securities industry for the rest of his life.
Here's the statement from the SEC:
“We are gratified by the jury’s verdict finding Mr. Tourre liable for fraud. We will continue to vigorously seek to hold accountable, and bring to trial when necessary, those who commit fraud on Wall Street. As shown by this verdict, we proved that Mr. Tourre, as a Goldman Sachs Vice President, put together a complicated financial product that was secretly designed to maximize the likelihood that it would fail, and marketed and sold it to investors without appropriate disclosure."

'Fabulous Fab' Found Guilty On 6 Of 7 Counts Of Securities Fraud

<div class="image-container float_right" style="width:800px"><div class="image"><img src="http://static6.businessinsider.com/image/51df4d1d6bb3f77501000004-1200-924/fabrice-tourre.jpg?maxX=800" border="0" alt="fabrice tourre" width="800" />REUTERS/Jim Young</div></div>NEW YORK (Reuters) - The trial of former Goldman Sachs bond trader Fabrice "Fabulous Fab" Tourre next week gives the U.S. Securities and Exchange Commission an opportunity to prove that it can win big cases tied to the financial crisis.
The <keyword id="6362470" type="ORGANIZATION" weightage="60" keywordseo="SEC">SEC</keyword> claimed an 85 percent success rate in all trials last year, but its critics have said that, when it comes to the financial crisis, its win rate has been dismal.
Tourre's civil fraud trial, which starts in federal court in New York on Monday, could help silence those critics, but experts said the regulator is facing no easy task.
The SEC has said that Tourre, while a vice president at Goldman Sachs Group Inc in 2007, misled investors in a structured investment vehicle called Abacus 2007-AC1 by not disclosing the role a hedge fund that planned to bet against the transaction played in setting it up.
Investors lost more than $1 billion when the investment vehicle failed, according to the SEC.
Goldman Sachs agreed to pay $550 million in July 2010 to settle its part of the case, without admitting or denying wrongdoing. Tourre turned down a settlement offer and instead elected to fight, a person familiar with the matter said on Wednesday.
For the SEC to prove fraud it must show Tourre intended to dupe the investors about the role played by the hedge fund run by billionaire John Paulson in the Abacus investment.
A negligence charge will turn on whether the information about the part Paulson played was material to investors.
Tourre's defense, as summarized by U.S. District Judge Katherine Forrest in June, is that the victims were "not be-hooded children, but rather large financial institutions, operating in a dog-eat-dog world."
Tourre is "confident that when all the evidence is considered, the jury will soundly reject the SEC's charges," his lawyers, Pamela Chepiga and Sean Coffey, said in a statement on Thursday.
'ENORMOUSLY CHALLENGING'
Thomas Sporkin, a former SEC lawyer who is now in private practice, said it is always difficult to hold an individual accountable for "institution wide culpability." Sporkin is not involved in the case.
"It's an enormously challenging task to put institutional blame on one person," Sporkin said.
Goldman Sachs, which agreed to cooperate with the SEC as part of its own settlement and which is also paying Tourre's legal fees, declined to comment.
Sporkin said a finding of liability against Tourre even just for negligence would help show it can be successful at trial in complex case.
"They'll be able declare victory and put Wall Street on notice that they can win complex cases against individuals at trial," he said.
Andrew Ceresney, co-director of enforcement at the SEC, said losing is a risk the SEC has to take in any case.
"We want to win every case," Ceresney said. "But it is probably true that if we're not losing a small number of cases, we're not being aggressive enough."
The SEC has disputed that it has not tackled the financial crisis head on, pointing to charges brought against 157 entities and individuals and $2.68 billion recovered from defendants, largely in settlements.
The stakes have grown even higher for the SEC since Chair Mary Jo White said last month that the agency was moving toward requiring defendants in some settlements to admit liability, a move that is likely to push more of them to take their chances in court.
SUCCESS RECORD
The SEC filed 734 cases in the 2012 fiscal year and obtained 714 settlements, according to the SEC and NERA Economic Consulting. It took 15 cases to trial, losing just two of them, the SEC said.
Among the victories, the agency secured judgments of nearly $8.9 million against investor relations firm Big Apple Consulting USA Inc and its executives after a jury trial in Florida.
A jury in Nebraska found two former chief financial officers of infoUSA Inc liable for their roles in a scheme to enable the company's CEO to illegally use millions of dollars in corporate funds for perks. The CEO settled without admitting or denying the charges.
But in cases against individuals at Wall Street firms at the center of the financial crisis and mortgage meltdown, the SEC's setbacks have mounted.
In July 2012, a federal jury in New York found former Citigroup manager Brian Stoker was not liable for violating securities laws regarding a $1 billion collateralized debt obligation tied to risky mortgage debt.
And in November the SEC dropped a similar case against Edward Steffelin, a former managing director at GSC Capital Corp, who was accused of negligence in his role in a mortgage-bond deal by JPMorgan Chase &amp; Co.. JPMorgan agreed to pay $153.6 million to settle related charges without admitting or denying the charges.
The same month, a jury in New York cleared Bruce Bent, the chairman of Reserve Management Co, of civil fraud charges stemming from his management of the $62 billion Reserve Primary Fund, which "broke the buck" after the bankruptcy of Lehman Brothers.
The SEC does not count that case as a loss: While the jury cleared Bent's son Bruce Bent II on fraud charges, it found him liable for negligently violating securities laws and also held two corporate entities liable.
But critics of the SEC say it was a loss because the SEC failed to secure a finding of liability against the senior Bent, one of the few Wall Street leaders to face trial after the financial crisis.
"The ability to handle large, complex cases is beyond the SEC," said John Coffee, a law professor at Columbia Law School.
In an op-ed piece in the National Law Journal in January, Coffee said the SEC's record was close to zero in financial crisis trials, saying it should hire private lawyers on contingency to bring cases on its behalf.
While many former SEC lawyers said Coffee's attack was overblown, they acknowledge a public perception that the SEC cannot win trials, thanks to the financial crisis cases.
Sporkin, one of the former SEC lawyers, contrasted the SEC's failures in cases over the financial crisis to an unbroken streak of convictions U.S. prosecutors have secured in their insider trading crackdown, including against Raj Rajaratnam.
On Wednesday, the SEC won a small victory in the Tourre case, when Judge Forrest ruled it could use as evidence an infamous email in which Tourre was referred to as "the fabulous Fab.
And it appears to be devoting significant manpower to the case. In an unusual move, it has put the head of its national trial unit, Matthew Martens, in charge of the case.
"In all my years at the SEC, I can't remember when the head of the trial unit actually tried a case," said Mark Fickes, a former SEC trial lawyer who is now in private practice. "But I guess this is a pretty big case."
(Reporting by Nate Raymond; Additional reporting by Sarah Lynch in Washington; Editing by Eddie Evans and Carol Bishopric)
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The SEC Case Against 'Fabulous Fab' Will Be An 'Enormously Challenging Task'

<ul class="summary-list"><li>The SEC's top litigator is stepping down to become No. 2 at the <keyword id="12098051" type="UNKNOWN" weightage="60" keywordseo="doj" source="Orion">DOJ</keyword> office handling January 6 cases.</li><li>Before joining the SEC, <keyword id="12738026" type="UNKNOWN" weightage="60" keywordseo="bridget-fitzpatrick" source="Orion">Bridget Fitzpatrick</keyword> was a public corruption prosecutor in Washington, DC.</li></ul>The Biden-appointed <keyword id="12723501" type="UNKNOWN" weightage="60" keywordseo="us-attorney" source="Orion">US attorney</keyword> in Washington, DC, has recruited a top lawyer from the <keyword id="11898794" type="UNKNOWN" weightage="60" keywordseo="securities-and-exchange-commission" source="Orion">Securities and Exchange Commission</keyword> for the second-ranking role in the federal prosecutor's office handling the hundreds of cases stemming from the January 6 attack on the Capitol, Insider has learned.Bridget Fitzpatrick, the SEC's chief litigation counsel, is poised to leave the commission to become the top deputy to <a href="https://www.businessinsider.com/steve-bannon-prosecutor-us-attorney-washington-dc-january-6-capitol-2021-12">US attorney Matt Graves</a>, according to multiple people familiar with her plans. For Fitzpatrick, the move marks a return to the US attorney's office where she once specialized in public corruption prosecutions.She is expected to start at the end of December or in early 2022 as the so-called first assistant US attorney under Graves, whose early tenure as the top federal prosecutor in Washington has been highlighted by the indictment of Trump ally <keyword id="12054994" type="UNKNOWN" weightage="60" keywordseo="steve-bannon" source="Orion">Steve Bannon</keyword> on contempt of Congress charges. On Monday, the congressional committee investigating January 6 <a href="https://www.businessinsider.com/mark-meadows-contempt-congress-house-january-6-committee-capitol-attack-2021-12">voted to recommend</a> that the full House hold former White House chief of staff <keyword id="11917799" type="UNKNOWN" weightage="60" keywordseo="mark-meadows" source="Orion">Mark Meadows</keyword> in contempt of Congress, setting the stage for another possible referral for a <keyword id="11897354" type="UNKNOWN" weightage="60" keywordseo="justice-department" source="Orion">Justice Department</keyword> prosecution out of Graves' office. Republican Rep. Liz Cheney of Wyoming also is suggesting DOJ should consider criminally charging former President Donald Trump with obstructing Congress for his role in the Capitol riot that halted lawmakers' plans to certify the 2020 election results.<iframe src="https://cdn.jwplayer.com/players/PUd0xZAq-gFnR6QwM.html" width="100%" height="100%" style="position:absolute;" title="Texts to former White House Chief of Staff Mark Meadows show his and Trump's inaction during the Jan. 6 riots"></iframe>In their previous stints at the US attorney's office, Graves and Fitzpatrick both worked in the fraud and public corruption unit — a team that reviews congressional referrals for prosecution and often brings cases against high-profile figures. Fitzpatrick once helped convict a sitting member of the District of Columbia's city council on charges he embezzled funds earmarked for youth programs, and Graves was involved in the prosecution of former Rep. Jesse Jackson Jr., who pleaded guilty in 2013 to making lavish purchases and covering personal expenses with campaign contributions.Fitzpatrick left the US attorney's office in 2012 for the SEC at a time when the commission was seeking to bring in trial experience ahead of enforcement actions tied to the financial crisis. In her first year at the SEC, she won a court decision finding the former Goldman Sachs trader Fabrice Tourre — the self-proclaimed "Fabulous Fab" who had become a symbol of Wall Street's role in the financial meltdown — liable for fraud.Matt Solomon, who once supervised Graves and Fitzpatrick as a senior official in the US attorney's office, said the two established themselves as stars early in their careers as prosecutors."Both of them had incredible white collar instincts, and that's what sets them apart. They just got white-collar in a way that a lot of prosecutors never do," said Solomon, who preceded Fitzpatrick as the SEC's chief litigation counsel and recruited her to the commission."And it's not that white-collar is so much harder than homicide or harder than gang cases, which are incredibly difficult to investigate and prosecute and critically important in the District. But there's a certain instinct for crimes that are a little grayer because they always involve proving what's going on inside someone's head as opposed to pulling a trigger or even having a readily identifiable victim."

The Securities and Exchange Commission's chief litigator is joining the US attorney's office handling January 6 cases

<ul class="summary-list"><li><keyword id="12737802" type="UNKNOWN" weightage="60" keywordseo="matt-graves" source="Orion">Matt Graves</keyword> brought contempt charges against <keyword id="12054994" type="UNKNOWN" weightage="60" keywordseo="steve-bannon" source="Orion">Steve Bannon</keyword> just a week after becoming US attorney.</li><li>His office is handling January 6 prosecutions and is expected to receive more referrals from Congress.</li></ul>The federal prosecutors knew that, if they didn't bring charges, Republicans would accuse the sitting Democratic administration of protecting one of its own. So the decision could not have a whiff of <keyword id="11893346" type="UNKNOWN" weightage="100" keywordseo="politics" source="Orion">politics</keyword>.It was late in the Obama presidency, and House Republicans had <a href="https://www.businessinsider.com/r-us-house-votes-ex-irs-official-lois-lerner-in-contempt-of-congress-2014-07">referred</a> a top IRS official to the <keyword id="11897354" type="UNKNOWN" weightage="60" keywordseo="justice-department" source="Orion">Justice Department</keyword> in a scandal over whether the tax agency had improperly targeted conservative groups. The IRS official, Lois Lerner, invoked the 5th Amendment to avoid answering questions from the House, but Republicans argued that she had waived her constitutional rights against self-incrimination and should be charged with contempt of Congress.The Justice Department <a href="https://www.washingtonpost.com/news/federal-eye/wp/2015/04/01/justice-department-will-not-seek-contempt-charges-against-lois-lerner/">declined</a> to pursue a case but stressed, in a 2015 <a href="https://s3.documentcloud.org/documents/21153510/machenlernerletter.pdf">letter</a>, that career prosecutors had carefully reviewed the Republicans' criminal referral. Among the career prosecutors was Matt Graves, then a senior official in the US attorney's office in Washington, DC.Six years later, Graves is now the face of that US attorney's office and grappling once more with politically-charged contempt referrals from the House. A week after being sworn in as US attorney in Washington, DC, Graves signed the <a href="https://storage.courtlistener.com/recap/gov.uscourts.dcd.237438/gov.uscourts.dcd.237438.1.0_1.pdf">indictment</a> charging Donald Trump ally Steve Bannon with contempt of Congress over his defiance of the January 6 inquiry. In the weeks since, the January 6 committee has only turned up the heat with recalcitrant Trump world figures, <a href="https://www.businessinsider.com/house-votes-trump-mark-meadows-criminal-contempt-congress-january-6th-2021-12">recommending that the full House</a> vote to hold former White House chief of staff <keyword id="11917799" type="UNKNOWN" weightage="60" keywordseo="mark-meadows" source="Orion">Mark Meadows</keyword> and <a href="https://www.businessinsider.com/jeffrey-clark-january-6-committee-plead-5th-amendment-2021-12">Jeff Clark</a>, a onetime <a href="https://www.businessinsider.com/contempt-congress-january-6-jeffrey-clark-justice-department-steve-bannon-2021-12">top Justice Department official</a>, in contempt of Congress.In a 222-208 vote late Tuesday, the House held Meadows in contempt and referred him to the Justice Department for prosecution."As with all criminal referrals, we will evaluate the matter based on the facts and the law, and the principles of federal prosecution," a spokesman for the US attorney's office, Bill Miller, said Wednesday.The referrals of Bannon and Meadows have landed on the doorstep of the US attorney's office in Washington at a time when it is also handling the deluge of prosecutions stemming from the January 6 attack on the Capitol. More than <a href="https://www.insider.com/all-the-us-capitol-pro-trump-riot-arrests-charges-names-2021-1">700 prosecutions</a> have arisen out of the January 6 investigation, which federal authorities have described as unprecedented.The cases have put the US attorney's office at the forefront of the Justice Department's dealings with Congress as the House January 6 committee looks to contempt prosecutions to bolster its aggressive push for answers about the Capitol attack.Former colleagues of Graves described the Reading, Pennsylvania, native as unflappable and almost uniquely made for the moment with his experience in an uncomfortable area for the Justice Department: the intersection of politics and prosecutions."He's not a novice to these issues. To have someone who has firsthand knowledge of the law, on the sort of issues you have to grapple with, it's huge. He would have picked it up anyway because he's a bright guy, but his past experience gave him an upper hand to be able to hit the ground running," said Channing Phillips, who <a href="https://www.businessinsider.com/biden-channing-phillips-acting-us-attorney-dc-capitol-riot-cases-2021-3">served</a> as the acting US attorney from March until Graves took office in early November.<div type="image" title="liz cheney" height="1334" width="1778" msid="88285346" hostid="261"></div><h2>Cheney floats a big fish: Trump </h2>It remains unclear how many Trump figures the House will refer to the Justice Department for prosecution out of the congressional inquiry into January 6 — though one big fish has come up in recent days for Graves' office to potentially consider.Late Monday, as the House committee investigating January 6 voted to recommend holding Meadows in contempt, Rep. Liz Cheney of Wyoming <a href="https://twitter.com/Jose_Pagliery/status/1470554291509334021?s=20">appeared to raise the possibility</a> that the congressional inquiry could prompt the Justice Department to prosecute Trump over his conduct during the Capitol breach.<iframe src="https://cdn.jwplayer.com/players/PUd0xZAq-gFnR6QwM.html" width="100%" height="100%" style="position:absolute;" title="Texts to former White House Chief of Staff Mark Meadows show his and Trump's inaction during the Jan. 6 riots"></iframe>Cheney, the committee's Republican vice chair, said text messages to Meadows were "further evidence of President Trump's supreme dereliction of duty during those 187 minutes." "And Mr. Meadows testimony will bear on another key question before this Committee: Did Donald Trump, through action or inaction, corruptly seek to obstruct or impede Congress's official proceeding to count electoral votes? Mark Meadows' testimony is necessary to inform our legislative judgments," she said. Her comments <a href="https://twitter.com/Jose_Pagliery/status/1470554291509334021?s=20">made waves</a> in legal circles in no small part because it <a href="https://twitter.com/joycewhitevance/status/1470595011117031424?s=21">sounded</a> like she was reading straight from the <a href="https://www.law.cornell.edu/uscode/text/18/1505">federal criminal statute</a>.In spite of attention surrounding his office, Graves has so far kept a low-profile in his first month as US attorney. He's made no comment about a potential Trump prosecution, which shouldn't be a surprise for someone of his position except for the fact one of his recent predecessors had publicly suggested such a case was under consideration during a <a href="https://www.businessinsider.com/60-minues-interview-justice-department-doj-capitol-riots-michael-sherwin-2021-3">controversial interview</a> with CBS's "60 Minutes" back in March. Shortly after his Senate confirmation, Graves delivered remarks at an annual gathering of current and former prosecutors in the US attorney's office. But he has not given any public interviews or held press conferences since then. A spokesman for his office declined to comment for this article.Former colleagues said Graves' early approach is in keeping with his measured, mild-mannered style. But he could begin to step out in coming months as Bannon goes to trial <a href="https://www.businessinsider.com/steve-bannon-trial-date-july-2022-judge-contempt-charges-2021-12">next summer</a> and criminal proceedings pick up against January 6 defendants."He won't seek the limelight but won't shy away from it either," said Ron Machen, a partner at the law firm Wilmer, Cutler, Pickering, Hale and Dorr who served as the US attorney in Washington under the Obama administration.In his current job, Graves is the face of the largest US attorney's office in the country — a size owed, in part, to its unique role as a federal and local prosecutor for the District of Columbia. Graves could adopt a more public-facing posture as the nation's capital confronts a year in which it recorded 200 homicides, a level of deadly violence it has not seen since 2003.<div type="image" title="Jackson Court" height="2220" width="2960" msid="88285348" hostid="261"></div><h2>Jesse Jackson Jr. and Roger Clemens</h2>Graves previously served in the US attorney's office from 2007 to 2016, a period in which he rose to become a top public corruption prosecutor. His nearly decade-long tenure was highlighted by the prosecution of former Rep. Jesse Jackson Jr. of Illinois, a onetime rising star in Democratic politics who pleaded guilty in 2013 to making lavish purchases and other personal expenditures with campaign funds.Jackson's <a href="https://www.justice.gov/usao-dc/pr/former-congressman-jesse-l-jackson-jr-pleads-guilty-conspiring-defraud-campaign-more">guilty plea</a> and <a href="https://www.businessinsider.com/jesse-jackson-jr-prison-sentencing-length-sandi-2013-8">30-month prison sentence</a> marked a triumph for the US attorney's office in a high-profile, politically-sensitive case against the son of the influential civil rights leader. But Graves also witnessed earlier in his tenure the failed prosecution of the former baseball star Roger Clemens on charges he lied to Congress in insisting that he never used steroids during his long career.Graves was not personally involved in the case, but former officials in the US attorney's office said the verdict underscored the challenges and pitfalls of politically-fraught prosecutions. Former officials said Graves is likely to draw on those experiences as closely-watched cases connected to the Trump era continue coming to the US attorney's office."He's not somebody who is going to be influenced one way or the other. I think he really will do the right thing, regardless of whether it's a referral with pressure from Democrats. "And, if the tables turn in 2022, who knows what referrals are going to come then?" said Matthew Solomon, a former top official in the US attorney's office who once supervised Graves. "In these kinds of cases, it's like brain surgery, and you have to have the judgment," he added. "You have to have an understanding of history, of what's happened in the past with these cases, and of political dynamics. And of course the touchstone is, in the end, doing what is right – but that often means cutting through a lot of noise and that takes force of personality as well as finesse. <div type="image" title="People walking out of the SEC building US Securities and Exchange Commission" height="2674" width="3567" msid="88285349" hostid="261"></div><h2>Firepower from the SEC</h2>As Graves has settled in as US attorney, he is also reconnecting with a former colleague from his time as a career prosecutor.Graves has recruited Bridget Fitzpatrick, a former federal prosecutor now serving as the Securities and Exchange Commission's chief litigator, to return to the US attorney's office as his top deputy, according to multiple people familiar with his pick. Fitzpatrick is expected to join the office later this month or in early 2022 after completing a background process.In her more than five-year tenure as a public corruption prosecutor, Fitzpatrick helped convict a sitting member of the District of Columbia's city council on charges he embezzled more than $350,000 earmarked for youth programs. She left the US attorney's office in late 2012 to join the SEC as the commission pushed to bring in more trial expertise in the aftermath of the financial crisis.In 2013, she won a court decision finding the former Goldman Sachs trader Fabrice Tourre — the self-proclaimed "Fabulous Fab" — liable for fraud. Tourre had become a symbol of Wall Street's role in the financial meltdown.The <keyword id="12492086" type="UNKNOWN" weightage="60" keywordseo="january-6-cases" source="Orion">January 6 cases</keyword> and contempt referrals from Congress will dominate the headlines of Graves and Fitzpatrick's tenure. But with their combined experience, Graves and Fitzpatrick have a chance to reinvigorate an office that was demoralized in the final year of the Trump administration as Justice Department leaders intervened in prosecutions to the benefit of the then-president's political allies, former officials said."Yes, they have to see through the January 6 cases. Yes, they have to deal with the congressional referrals. But, to me, I think a big project for them is also going to be rebuilding a significant white collar portfolio in that office," said Solomon, who served as the SEC's chief litigation counsel following his stint in the US attorney's office and recruited Fitzpatrick to the commission.Solomon said they have the "full package, which is incredibly rare, of being incredibly hard-working, having really good white-collar instincts and being very, very intelligent and also very good trial lawyers."<div type="image" title="ben carson 2013" height="682" width="910" msid="88285350" hostid="261"></div><h2><keyword id="12737803" type="UNKNOWN" weightage="60" keywordseo="ben-carson" source="Orion">Ben Carson</keyword>, Nike &amp; GE</h2>Graves joined the law firm DLA Piper as a partner after stepping down in 2016 as the chief of the fraud and public corruption unit within the federal prosecutor's office. His role at the Justice Department put him in charge of the team that reviewed referrals from Congress and other cases involving well-known figures.In private practice, his work continued to feature public figures and closely-watched cases.Among his clients was Ben Carson, a former 2016 Republican presidential candidate who served in the Trump administration as secretary of housing and urban development. Graves' roster of corporate clients included Nike, General Electric and the <keyword id="11893589" type="UNKNOWN" weightage="60" keywordseo="news" source="Orion">news</keyword> outlet Al-Jazeera, according to his financial disclosure.Public court filings show that Graves represented Al-Jazeera in litigation involving the professional baseball players Ryan Zimmerman and Ryan Howard, who sued the news outlet over a documentary alleging that they used performance-enhancing drugs. Graves withdrew from the case in July after President Joe Biden nominated him for the US attorney role.In recent years, he has also represented the oil-rich state of Qatar, T-Mobile and the Bank of Palestine, amassing a client roster that has concerned good-government advocates who have <a href="https://www.politico.com/news/2021/11/15/dc-new-top-cop-steve-bannon-522259">raised alarm</a> over the private sector ties of Biden appointees.But former leaders of the US attorney's office said the defense-side perspective will only help Graves as he makes closely-scrutinized decisions in the political crucible."He'll game it out, he's methodical. He'll look at the case law precedent and weigh the pros and cons. He's not just a career prosecutor but has been on the defense side and represented individuals and organizations as well," Machen said. "The ability to understand both sides of an issue rather than view the matter through only one type of lens is critical in these sorts of high-profile matters," added Machen, who held Graves' job from 2010 to 2015. "You have to be able to see the whole playing field and he has got the experience to do that and to do it effectively."

Trumpworld's new nemesis is the most important Justice Department official you've never heard of

<div class="image-container float_right" style="width:480px"><div class="image"><img src="http://static6.businessinsider.com/image/51df4d1d6bb3f77501000004-1200-924/fabrice-tourre.jpg?maxX=480" border="0" alt="fabrice tourre" width="480" />REUTERS/Jim Young</div></div>NEW YORK (<keyword id="76338" type="CITY" weightage="60" keywordseo="Reuters">Reuters</keyword>) - Fabrice Tourre, the former Goldman Sachs trader accused of secretly helping the hedge fund of billionaire John Paulson construct a $2 billion deal it could bet against in 2007, is set to testify Wednesday in his civil fraud trial.
The U.S. Securities and Exchange Commission has said it will call Tourre, 34, on the eighth day of what has become the highest-profile trial to come out of the agency's investigations of the 2008 <keyword id="6371665" type="UNKNOWN" weightage="60" keywordseo="financial-crisis">financial crisis</keyword>. He is not likely to be called before the afternoon.
The trial is a chance for the SEC to show it can win big cases against individuals on Wall Street for wrongdoing that caused the financial crisis.
SEC lawyers say Tourre was driven by "Wall Street greed" to mislead investors in the infamous investment called Abacus 2007-AC1. He denies any wrongdoing.
His testimony comes three years after the SEC accused him and Goldman Sachs Group Inc of fraud over Abacus, a synthetic collateralized debt obligation.
Goldman and Tourre did not tell potential investors that Paulson's hedge fund, Paulson &amp; Co Inc, helped select the mortgage-backed securities linked to Abacus and then went on to bet against it. Amid the outcry that followed, Tourre was called before a congressional committee.
Goldman Sachs agreed in July 2010 to pay $550 million to settle the claims against it without admitting or denying wrongdoing. Before that accord was announced, Tourre received a settlement offer but rejected it, a person familiar with the matter said.
Tourre, who left Goldman in 2012, is now an economics doctoral student at the University of Chicago. He faces a fine and a lifetime ban from the securities industry if jurors find him liable.
The SEC also contends Tourre misled a company brought on to help select the securities, ACA Capital Holdings Inc, into believing that Paulson was an equity investor in Abacus when in fact the hedge fund planned to bet against, or short, the deal.
ACA, which was renamed Manifold Capital Corp in 2008, ultimately not only helped set up Abacus as the portfolio selection agent but also bought $42 million of securities in the deal and agreed to insure a $909 million slice of it via its then-subsidiary ACA Financial Guaranty Corp.
The SEC cites in its complaint an email Tourre sent on January 23, 2007, to his girlfriend at the time, in which he said the "whole building is about to collapse anytime now" - a reference to the financial markets.
The email continued: "Only potential survivor, the fabulous Fab ... standing in the middle of all these complex, highly leveraged, exotic trades he created without necessarily understanding all of the implications of those monstruosities!!!"
When the securities in Abacus turned toxic amid the downturn in the U.S. subprime mortgage market, investors lost $1 billion, the SEC says. Paulson, who made $15 billion betting against the housing market, meanwhile made about $1 billion shorting the CDO, the SEC says.
During testimony before the U.S. Senate Permanent Subcomittee on Investigations in 2010, Tourre said ACA and another investor in the deal, IKB Deutsche Industriebank AG, had "significant resources and extensive experience in the CDO market."
He denied telling ACA that Paulson was an equity investor, saying he recalled "informing ACA that Paulson's fund was expected to buy credit protection" on parts of the CDO deal, meaning it would be taking a short position.
"Quite frankly, I am surprised that ACA could have believed that the Paulson fund was an equity or long investor in the deal," Tourre said then.
The case is SEC v. Tourre, U.S. District Court, Southern District of New York, No. 10-03229.
(Reporting by Nate Raymond; Editing by Eddie Evans and Douglas Royalty)

Former Goldman Sachs Trader 'Fabulous Fab' To Testify Over Shady $2 Billion Paulson Deal

Last week, when the Fabrice "Fabulous Fab" Tourre verdict came out, <keyword id="29740" type="CITY" weightage="60" keywordseo="Bloomberg">Bloomberg</keyword> News sent out an erroneous headline and Tweet saying the former Goldman Sachs employee had won his SEC civil case. 
<div class="image-container display-table"><div><div class="image"><img src="http://static1.businessinsider.com/image/51ff9ffbecad048778000017-778-137/screen shot 2013-08-01 at 3.30.22 pm.png" border="0" alt="tourre tweeet" />Twitter</div></div></div>
A correction came out shortly after saying that Tourre was actually <a href="http://www.businessinsider.com/fabulous-fab-found-guilty-2013-8">found liable on six of the seven charges.</a> 
That erroneous Tweet/headline appears to have cost an editor his job.
According to <a href="http://www.nypost.com/p/news/business/not_so_fab_headline_costs_bloomberg_wYQkx4cpsKilD8bouv2R4K">the New York Post's Keith Kelly and Mark DeCambre</a>, the headline was sent out by Bloomberg editor John Pickering. 
Pickering, who spent around 20 years at the financial media giant, lost his job the next day because of the incorrect headline, reports the Post.

A 20-Year Bloomberg News Veteran Lost His Job After Publishing An Incorrect Headline

Last week, when the Fabrice "Fabulous Fab" Tourre verdict came out, <keyword id="29740" type="CITY" weightage="60" keywordseo="Bloomberg">Bloomberg</keyword> News sent out an erroneous headline and Tweet saying the former Goldman Sachs employee had won his SEC civil case. 
<div class="KonaFilter image-container display-table"><div><div class="image"><img src="http://static1.businessinsider.com/image/51ff9ffbecad048778000017-778-137/screen shot 2013-08-01 at 3.30.22 pm.png" border="0" alt="tourre tweeet" />Twitter</div></div></div>
A correction came out shortly after saying that Tourre was actually <a href="http://www.businessinsider.com/fabulous-fab-found-guilty-2013-8">found liable on six of the seven charges.</a> 
That erroneous Tweet/headline appears to have cost an editor his job.
According to <a href="http://www.nypost.com/p/news/business/not_so_fab_headline_costs_bloomberg_wYQkx4cpsKilD8bouv2R4K">the New York Post's Keith Kelly and Mark DeCambre</a>, the headline was sent out by Bloomberg editor John Pickering. 
Pickering, who spent around 20 years at the financial media giant, lost his job the next day because of the incorrect headline, reports the Post.

<div class="KonaFilter image-container display-table float_right"><div><div class="image on-image"><img src="https://static-ssl.businessinsider.com/image/55d45000dd08950a058b458f-1333-1000/nicole el karoui2.jpg" alt="Nicole El Karoui2" data-mce-source="YouTube/Fondation Cartier pour l'art contemporain" data-mce-caption="Famous maths professor Nicole El Karoui." />YouTube/Fondation Cartier pour l'art contemporainFamous maths professor Nicole El Karoui.</div></div></div>Mathematical whizkids and former physicists-turned bankers are almost becoming dime a dozen in the financial world.But there's a truism that's been rife in the banking sector for decades - France turns out a high number of quantitative analysts.<a href="http://wilmott.com/messageview.cfm?catid=3&amp;threadid=49364&amp;FTVAR_MSGDBTABLE=">Financiers take to the forums to ask why</a> and associations have been set up to highlight and help France's deluge of quants to network. <a href="http://www.quantvalley.org/home.aspx">This association "Quant Valley" is even subtitled "Paris the City of Quants."</a>And it can all be traced back to one maths genius -<a href="http://www.cmapx.polytechnique.fr/~elkaroui/">Nicole El Karoui</a>.On a basic level, quants - what they're more commonly known as in banking - use computers to tell them what to buy and sell. However, the programmes and analysis require a deep level of pure mathematics and algorithms that only a very neat pool of professionals would understand. French-Tunisian El Karoui is an architect in this field and has been instrumental in shaping France's academic institutions in the way they teach quantitative finance.French universities now rank amongst the top in the world for churning out the high-calibre and highest-paid finance graduates. For example, the average finance graduate from <a href="http://uk.businessinsider.com/best-paid-finance-graduates-universities-2015-8#ixzz3jAfW8ps5">Ecole Polytechnique in France will earn around £74,000 ($115,000)</a>. In fact, there are seven French universities in the top 15 for best paid financial graduates in the world. Famously, some of world's famous quants, and rogue traders, hail from a number of these universities.The woman that shaped France's reputation for quants<div class="KonaFilter image-container display-table float_right"><div><div class="image on-image"><img src="https://static-ssl.businessinsider.com/image/55d45000dd08950a058b4590-831-388/nicole el karoui.jpg" alt="Nicole El Karoui" data-mce-source="YouTube/Vi?n Nghiên c?u cao c?p v? Toán" data-mce-caption="Introduction to Credit Risk - Prof Nicole El Karoui on YouTube from this year." />YouTube/Vi?n Nghiên c?u cao c?p v? ToánIntroduction to Credit Risk - Prof. Nicole El Karoui teaching. Documented on YouTube from this year.</div></div></div>Those under the tutelage of professor El Karoui are famously sought after in London's Square Mile and New York's Wall Street. The Paris-based maths professor, who teaches the niche art of creating and pricing complex financial instruments linked to stocks, bonds and loans - derivatives, is the co-director, with Marc Yor and Gilles Pagès, of the Master of Advanced Studies programme Probability &amp; Finance (more commonly known as "DEA El Karoui"). The programme is currently jointly operated by <a href="https://en.wikipedia.org/wiki/%C3%89cole_Polytechnique" title="École Polytechnique">École Polytechnique</a> and the <a href="https://en.wikipedia.org/wiki/Pierre_and_Marie_Curie_University" title="Pierre and Marie Curie University">Pierre and Marie Curie University</a>.It also is now one of the most prestigious programmes in quantitative finance in the world. In 2006, just before the shine was taken off those trading in complex derivatives by the credit crisis, the media like The Wall Street Journal highlighted what a huge deal it was for finance students to study under the famous French quant expert. "<a href="http://www.wsj.com/articles/SB114187184703793317">When I talk about El Karoui's master's, everyone knows</a>," said a French student at the time Xavier Charvet to the WSJ.Rama Cont, a former student and now Professor of Mathematics and Chair in Mathematical Finance at <a href="http://imperial.ac.uk/">Imperial College London</a>, said El Karoui's name was "<a href="http://www.wsj.com/articles/SB114187184703793317">the magic word that opened doors for young people.</a>"At the time, the WSJ reported that banking headhunters sought after the 75 or so students that were being tutored in El Karoui's "Probability and Finance" course. In the same report, head of BNP Paribas's US equity and derivatives department in New York, Amine Belhadj, even said that El Karoui "played a crucial role in finding interns when the bank began handling derivatives for clients in 1989."<h2>Rise and fall of French quants</h2><div class="KonaFilter image-container display-table float_right"><div><div class="image on-image"><img src="https://static-ssl.businessinsider.com/image/55d45000dd08950a058b4591-1978-1484/gettyimages-98698856.jpg" alt="Fabrice tourre" data-mce-source="Getty" data-mce-caption="Fabrice Tourre (L), executive director of the structured products group trading for The Goldman Sachs Group (at the time), is sworn in while testifying before the Senate Homeland Security and Governmental Affairs Investigations Subcommittee on Capitol Hill on April 27, 2010 in Washington, DC." />GettyFabrice Tourre (L), executive director of the structured products group trading for The Goldman Sachs Group (at the time), is sworn in while testifying before the Senate Homeland Security and Governmental Affairs Investigations Subcommittee on Capitol Hill on April 27, 2010 in Washington, DC.</div></div></div>El Karoui shaped the banking world from the outside-in, and with this, a plethora of French quants would flood the shores of the US and the <keyword id="6354868" type="COUNTRY" weightage="60" keywordseo="UK">UK</keyword>.Immediately following her help in the late 1980s for banks finding the right talent in the derivatives sector, French universities were developing programmes that used her teachings and methods to focus on "<a href="http://www.newsweek.com/quants-derivatives-and-myth-rogue-trader-64883">the very, very complex modeling of derivatives</a>," reported Newsweek. British or other European universities were not on the same page.Instead UK and European banks would siphon in French talent.But the French talent did come at a price - like Frankenstein's monster, El Karoui's theories and methods, which were taught in all the major French universities, <a href="http://www.businessinsider.com/every-time-a-few-billion-dollars-evaporate-someone-french-seems-to-wind-up-in-the-headlines-2012-5#ixzz3jFYcapNr">were being misused</a>. The traders that lost a ridiculous amount of money (legally or illegally) and became household names for it were often French and hailed from French university derivatives tutelage.Goldman Sachs' one time wonder kid, Fabrice "Fabulous" Tourre, came from the elite École Centrale Paris. Unfortunately, he was dubbed the "face of Wall Street greed" by US regulator Securities and Exchange Commission (SEC) and was fined £391,000 ($650,000) and told to hand back a £112,000 ($175,000) bonus for defrauding investors in the run up to the credit crisis.Former trader Bruno Iksil - dubbed "The London Whale" for his massive legal market bets - was also a derivatives wizard that reportedly went to École Centrale. While he was at the centre of the $6.2 billion (£4 billion) JP Morgan legal trading loss of 2012, when massive derivatives bets went sour, he was a massive profit generator for the bank previously.Critics say that traders that don't come from the same calibre of university, such as Jerome Kerviel, also make huge mistakes like financial wizards, such as Iksil and Tourre, to prove their worth. Kerviel, a former trader at Societe Generale's <a href="http://www.businessinsider.com/jerome-kerviel-gets-out-of-jail-early-2014-9?IR=T">lost $5.8 billion (£3.7 billion) in rogue trades</a> and graduated from the <a href="http://www.newsweek.com/quants-derivatives-and-myth-rogue-trader-64883">less prestigious and "provincial" university</a> (University of Lyon). <div class="margin-top"> <h3>NOW WATCH: <a href="http://www.businessinsider.com/50-cent-files-bankruptcy-lawsuit-rise-fall-2015-7">This is how rapper 50 Cent made millions and then lost it</a></h3> <div> <div> <script src="http://player.ooyala.com/v3/6e12e8b3387a44daacfb73afba25a76e"></script> <div class="ooyala-video-player" data-video-autoplay="false" data-video-id="VlbnI2djrZXIh9tIkLc68cC984sL8GSb" data-player-variable="ooyalapopvideo" id="ooyalaplayer_popvideo" style="width:1280px;height:720px"></div> <script> if (typeof RunFunctions === 'undefined') { var RunFunctions = []; } RunFunctions.push(function() { var ooyalapopvideo = OO.Player.create('ooyalaplayer_popvideo', 'VlbnI2djrZXIh9tIkLc68cC984sL8GSb',{ autoplay: 'false' }); }); </script> <noscript><div>Please enable Javascript to watch this video</div></noscript></div> </div> <script>(function() { function createPlayer() { OO.ready(function() { RunFunctions.forEach(function(ooyalaFunction) { ooyalaFunction(); }); RunFunctions = [];}); } createPlayer(); }()); </script> </div>

France is famous for its quants because of this one woman

<div class="KonaFilter image-container float_right"><div class="image"><img src="http://static3.businessinsider.com/image/52cc0c7a6bb3f75f7ac42823-518-388/mathew-martoma-3.png?maxX=480" border="0" alt="Mathew Martoma" width="480" />YouTube via ReutersVideo</div></div>Think this would make a difference?
Today, jury selection will begin in the insider trading case against Mathew Martoma, a former portfolio manager at embattled hedge fund SAC Capital. But before attorneys could argue before the jury, Martoma's lawyers tried to set an interesting term - they wanted to ban the use of the word "greed" during the trial.
This request didn't go over well, <a href="http://mobile.nytimes.com/blogs/dealbook/2014/01/06/trial-to-begin-for-ex-sac-trader-who-cut-no-deal/?from=dealbook">according to the NYT:</a>
In a ruling on Monday, the judge presiding over the trial, Paul G. Gardephe, barred prosecutors from introducing evidence of Mr. Martoma's fainting spell. But he decided to allow prosecutors to use the word "greed" during the trial, despite concerns raised by Mr. Strassberg that the word could be used as a way to "tap into the anger out there against Wall Street."
Remember, Martoma <a href="http://www.businessinsider.com/mathew-martoma-passed-on-when-fbi-contronted-him-2012-12">fainted in his </a>front yard when the FBI took him in.
Martoma is accused of passing inside information to Steve Cohen, the founder of SAC Capital, that made the firm $276 million. It's the latest in a string of cases against SAC, which last year pleaded guilty to federal insider trading charges, returned outside investor money, and became a family office.
Mr. Cohen is paying Mr. Martoma's legal fees, and Martoma has not implicated Mr. Cohen in any charges.
Now, about this anger against Wall Street. It has two very dangerous characteristics for Mr. Martoma. First, it's real and second, it's simple.
You hear it all the time during cases involving Wall Street's misdeeds - the jury doesn't understand the case, the crime, or the victim. Most recently, it was repeated over and over again during the trial of Goldman Sachs' Fabrice Tourre.
"Some members of the nine-person jury appeared to fall asleep as one expert witness testified to the ins-and-outs of the deals," Tracy Alloway <a href="http://www.ft.com/intl/cms/s/0/bf88aa8e-fa27-11e2-98e0-00144feabdc0.html#axzz2bTYl4RV4">reported in the FT</a>. 
But Tourre's case was more complicated than Martoma's matter. Using the word greed makes it simpler still.
All that said, you may want to review the finer points of SAC Capital's history with insider trading charges. Frontline, tonight, will air a documentary on this topic at 10:00 pm EST. That should get you prepped.

Defense Lawyers In The First Big Insider Trading Trial Of 2014 Tried To Ban The Word 'Greed' 

<div class="image-container float_right" style="width:400px"><div class="image"><img src="http://static1.businessinsider.com/image/520229cfecad048f45000004-1200-924/tesla-elon-musk.jpg?maxX=400" border="0" alt="tesla elon musk" width="400" />REUTERS/Lucy Nicholson </div></div>Good morning! Here's what you need to know.
<ul>
<li>Asian markets got crushed. Japan's Nikkei fell -4.00%, Australia's ASX200 declined -1.85%, and Korea's Kospi was off -1.48%. European markets are faring little better: Germany's DAX has retreated -0.65%,; London's FTSE, -0.40%.</li>
<li>The MBA's weekly mortgage applications will be published at 7:30 am. Cleveland Fed President Sandra Pianalto will speak at 1:40 pm. And the latest consumer credit figures will come out at 3 pm — a decline of -$4.6 billion to $15 billion is expected for June outstanding credit.</li>
<li>Tesla and Groupon announce earnings after the bell today. Green Mountain, Ralph Lauren, Time Warner, and SolarCity also announce today.</li>
<li>It looks increasingly likely the Fed will begin to taper its bond-buying program in September. Yesterday, Chicago Fed President Charles Evans, one of the Fed's most dovish members, told an audience he liked what he was seeing out of the labor market and would "clearly not rule out" a September taper. <a href="http://www.businessinsider.com/feds-evans-2013-8">SocGen's Alvin Tan notes that since the last FOMC meeting, all three Fed members to speak have in one way or another endorsed a September start date</a>. </li>
<li>Bank of England Governor Mark Carney said <a href="http://www.businessinsider.com/bank-of-england-forward-guidance-2013-8#ixzz2bHIQUMuS">he will not raise interest rates until unemployment falls below 7%.</a> He also upgraded GDP forecasts to 1.5% in 2013 and 3.7% in 2014.</li>
<li><a href="http://www.nytimes.com/2013/08/07/business/washington-edges-warily-into-housing.html?hp">President Obama said Tuesday it was time to "wind down" Fannie Mae and Freddie Mac</a>, the government-sponsored enterprises that helped enable the financial crisis. He said he supported a Senate plan to replace the GSEs with a system that would, "charge lenders for explicit government guarantees of some mortgage loans," the New York Times' Binyamin Appelbaum reports. Appelbaum adds: "For all the talk, however, it will be difficult to alter the government’s role in housing finance, which has remained substantially unchanged for half a century — notwithstanding Fannie and Freddie’s move from informal to formal wards of the state. That is because Americans like cheap mortgage loans and it is hard to preserve the benefits without the costs of the current system."</li>
<li>The SEC and Justice Department <a href="http://online.wsj.com/article/SB10001424127887323968704578652302136846358.html?mod=WSJ_hp_LEFTWhatsNewsCollection">charged Bank of America with alleged fraud over 2008 mortgage backed securities sales yesterday</a>, but the Wall Street Journal's Jean Eaglesham reports <a href="http://online.wsj.com/article/SB10001424127887323968704578652302136846358.html?mod=WSJ_hp_LEFTWhatsNewsCollection">the SEC's push to sanction entities involved in the financial crisis is actually losing steam</a>. Citing unnamed sources, she writes: "Despite last week's courtroom victory in a civil trial against former Goldman Sachs Group Inc. trader Fabrice Tourre over his role in a deal called Abacus 2007-AC1, securities regulators are quietly winding down some of their highest-profile investigations related to the crisis, these people said."</li>
<li><a href="http://www.businessinsider.com/carl-icahn-made-500-million-on-herbalife-2013-8">Carl Icahn told CNBC yesterday he'd already made $500 million on his long-Herbalife position</a>, which he took based on Bill Ackman's short. We also know George Soros is long the stock, and this week <a href="http://www.nypost.com/p/news/business/health_food_fight_JBcKrkNQ9r0VmLZU1tLWaN">Ackman filed a complaint with the SEC that he believes Soros may have engaged in insider trading</a>.</li>
<li>As expected, former Detroit Medical Center chief Mike Duggan and former Detroit Police Chief and current Wayne County Sheriff Benny Napoleon <a href="http://www.freep.com/article/20130806/NEWS01/308060161/Napoleon-Duggan-appear-headed-November-showdown-Detroit-mayor-amid-flood-write-ins"> won yesterday's primary for Detroit's mayoral election and will square off for the November vote. </a> Last week, <a href="http://www.businessinsider.com/detroit-mayor-race-update-2013-7">we explained all the problems that had cropped up in the race</a> and why lots of important groups have endorsed Duggan.</li>
<li>There are signs childhood obesity among low-income groups is waning. <a href="http://online.wsj.com/article/SB10001424127887324653004578652010608206812.html?mod=WSJ_hps_MIDDLENexttoWhatsNewsThird">New federal data show that between 2008 and 2011, obesity declined in 19 of 43 states measured. </a></li>
</ul>

10 Things You Need To Know Before The Opening Bell

<div class="image-container float_right" style="width:400px"><div class="image"><img src="http://static6.businessinsider.com/image/51fb8ed06bb3f78159000010-1200-924/lawrence-larry-summers-ben-bernanke-2.jpg?maxX=400" border="0" alt="lawrence larry summers ben bernanke" width="400" />REUTERS/Kevin LamarqueDirector of the National Economic Council Lawrence Summers (L) talks with U.S. Federal Reserve Board Chairman Ben Bernanke as they wait in the East Room of the White House in Washington for President Barack Obama's remarks laying out a comprehensive regulatory reform plan in June 17, 2009.</div></div>Good morning! Here's what you need to know.
<ul>
<li>Asian markets gained big today, led by the Nikkei, which climbed 3.3%. Australia's ASX 200 gained 1.2%. European markets were more uneven, with the FTSE off -0.1% and the DAX up 0.1%.</li>
<li>At 8:30 am ET, we learn how many non-farm payrolls the U.S. economy added in July. The consensus is for 185,000, compared with 195,000 in June. The BLS will also announce new earnings data, and check in on the unemployment rate. </li>
<li>Goldman Sachs <a href="http://www.businessinsider.com/goldman-3-reasons-tomorrows-jobs-report-will-be-strong-2013-8">predicts NFP will tick 200,000 based on three elements</a>: recent strong manufacturing data, recent strong consumer confidence data, and the most recent ADP report, which showed a gain of 200,000. Deutsche Bank's Joe LaVorgna is even more bullish, <a href="http://www.businessinsider.com/most-bullish-jobs-forecast-on-the-street-2013-8#ixzz2ao5swtWB">placing his bets on a gain of 225,000</a> based on the following: "Since last October, when Moody's took over from Macroeconomic Advisors, the average forecast miss from the initially reported private payroll number and the initially reported ADP figure has been just +9k. The standard deviation has been +44k."</li>
<li>Toyota <a href="http://www.businessinsider.com/toyota-earnings-2013-8">announced its Q2 net profit had nearly doubled</a> to a record $5.64 billion, thanks mostly to the falling value of the yen. The automaker also said it would likely pump out more than 10 million vehicles this year.</li>
<li>The UK's construction purchasing manager's index (PMI) <a href="http://www.businessinsider.com/uk-construction-pmi-2013-8">surged to 57 from 51 in Ju</a>ly. It was the third-straight monthly gain for business activity. Residential construction increased at the fastest rate since June 2010, and new orders saw their biggest jump in more than a year.</li>
<li>At 10 am, we'll get new factory order data. Plus, St. Louis Fed President James Bullard will deliver a speech about the economy in Boston at 12:15 am. Chevron, Viacom, Eaton Corp. and Church and Dwight will announce earnings today.</li>
<li>The Dow (15,628) and S&amp;P (1,706) <a href="http://www.businessinsider.com/closing-bell-august-1-2013-2013-8">closed at all-time highs yesterday</a> on solid US economic data, including <a href="http://www.businessinsider.com/jobless-claims-august-1-2013-8">the lowest jobless claims print since Jan. 2008</a>. Meanwhile, the FT notes that the FTSE All-World equity index, which covers more than 90% of all stock indices, is today <a href="http://www.ft.com/intl/cms/s/0/4c6ccce4-fb24-11e2-87b9-00144feabdc0.html#axzz2ao0oM4lf">within two points of its June 2008 high.</a></li>
<li><a href="http://www.nytimes.com/2013/08/02/business/economy/obama-narrows-field-for-fed-chairman-to-3.html?hp&amp;_r=0&amp;pagewanted=all">The New York Times' Annie Lowery reports</a> the Obama Administration is interviewing three candidates to replace outgoing Fed Chair Ben Bernanke: Larry Summers, Janet Yellen, an Donald Kohn. But Lowery says the president is seems to be leaning toward on Summers: "...it is his reputation among economic policy staff members that might ultimately secure him Mr. Obama’s nod. 'You can’t find a member of the economic team who is for anyone but Larry,' said a person close to the administration who declined to talk on the record before Mr. Obama makes his decision. 'That’s true at Treasury, that’s true at the White House. The reason is, Larry has been through this. Larry brings the right skills to bear here. ' ”</li>
<li>Former Goldman Sachs trader Fabrice Tourre <a href="http://www.ft.com/intl/cms/s/0/18098490-f86a-11e2-b4c4-00144feabdc0.html#axzz2ao0oM4lf">was convicted yesterday on six of seven counts</a> related to defrauding clients in a subprime mortgage derivatives deal. He faces a fine and will have to return profits. </li>
<li>Google has released a new smartphone, the Moto X, via its Motorola subsidiary. <a href="http://www.businessinsider.com/google-just-made-the-best-phone-that-no-one-will-buy-2013-8">Our Steve Kovach found it sleek, uncluttered and liked the new features including voice-command,</a> but he thinks no one will buy it because the market is too saturated.</li>
</ul>

<div class="image-container float_right"><div class="image"><img src="http://static6.businessinsider.com/image/521f69596bb3f72135e58b3e-1200-924/ties-mens-fashion-suits.jpg?maxX=480" border="0" alt="ties, men's fashion, suits" width="480" />REUTERS</div></div>It appears that writing is all about making lists these days. 
So, having recently covered Tips for Surviving a <a href="http://gselevator.wordpress.com/2013/05/31/congratulations-summer-interns-of-2013-grab-a-pen-here-are-a-few-words-of-wisdom/">Goldman Sachs Internship</a> and Attending a <a href="http://gselevator.wordpress.com/2013/07/24/how-to-survive-a-sporting-event-with-your-boss/">Sporting Event With Your Boss</a>, my latest attempt (by request) is a fresh, succinct, and definitive guide to dressing like an investment banker.
The genesis of this post is simple; American men dress like s---. 
It doesn’t matter where you look, from the endless stream of bright-eyed but hopeless-looking students vying for the ever-shrinking number of analyst positions on Wall Street, to the haggard, white-collar, middle class masses traipsing their way from airport lounge to departure gate, while getting Hilton Reward Points rich and Chipotle fat.
Who better to help than <a href="https://twitter.com/GSElevator">the aggregated and infinite wisdom of</a> <a href="https://twitter.com/GSElevator">GSElevator</a>, with a comprehensive list of business fashion tips from the halls of Goldman Sachs?
So, here we go…
Shoes
<ul>
<li>No brogues, wing-tipped, or square-toed shoes. </li>
</ul>
#1: He's really wearing square-toed shoes...
#2: Wait, it's intern season already?
<ul>
<li>Stick with loafers; they’re more comfortable and convenient. And the conventional wisdom that they lack the formality of traditional lace-ups has long-since expired.</li>
<li>If you aren’t confident in your innate fashion sense, keep the shoes black when wearing a suit. There’s no need to attempt hazel Bottega Venetas and a matching belt with a monastral blue suit. In most cases, you can’t pull it off.</li>
<li>Prada and Gucci; start and end there. Decent $700 shoes will last you 3-4x times longer than something you pick up from Bloomingdale’s for $300. Do the math.</li>
<li>Cedar shoetrees are an absolute must. They absorb moisture, stiff-arm the signs of aging, and otherwise materially extend the life of your shoes.</li>
<li>Don’t forget to get your housekeeper a decent shine kit for Christmas. And make sure she uses it.</li>
</ul>
Socks
<ul>
<li>Unless you are married to a Sloane Ranger or studied Classics at Cambridge, leave the pink Richard James socks at home. It’s not Ladies’ Day at Ascot.</li>
</ul>
 #1: Most Brits aren't gay, but their socks are.
<ul>
<li>Calvin Klein or Giorgio Armani makes some great calve-high plain black socks that never change with the season. And just as Michael Jordan insisted on a new pair of shoes every game, you need to keep the socks fresh. </li>
<li>Buy at least 20 identical pair every six months. </li>
</ul>
#1: I wear a brand new pair of socks every day. That's probably my only indulgence. That, and watches... And wine.
<ul>
<li>The ‘no socks’ look is disgusting, and is actually a stated violation of many corporate dress codes, particularly for banks.</li>
</ul>
Pants/Trousers
<ul>
<li dir="ltr">
No cuffs and no pleats; pleats are for guys with gunts (front asses). 
</li>
</ul>
#1: Dude, cuffed pants are for limo drivers.
<ul>
<li dir="ltr">
Belt loops are optional. If you have a decent tailor, rock the side tabs. 
</li>
</ul>
#1: Did you forget your belt today?
#2: I don't need one; did you forget to get your suit tailored?
<ul>
<li dir="ltr">
Actually, side tabs are rather convenient if you are a junior banker. You’ve got less time for the gym and spend many a lunch and dinner hunched over your desk. Throw in the boozy nights out and extravagant client dinners and it’s a recipe for looking like 2011 Alec Baldwin.
</li>
</ul>
Belts/Suspenders
<ul>
<li>This is pretty obvious - nothing garish or obnoxious, and this includes those ridiculous monogrammed silver buckles that all boys in Greenwich get for their 14th birthday.</li>
<li>A few years ago, we had a 1st year analyst walk across the trading floor with a Gucci ‘G’ belt buckle. “Hey bubba, I didn’t know The Gap made belts,” bellows out a trader. “Um, it’s Gucci,” the kid snaps back. The words are barely out of his mouth before he realizes he’s being mocked in front of half a dozen guys and just made it a lot worse. That was all it took; the kid was never able to earn even a modicum of respect after that, and ended up leaving the firm less than a year later.</li>
<li>No suspenders, period. Who do you think you are, Matt “GG” Defusco?</li>
</ul>
Shirts
<ul>
<li>The infamous blue shirt and white collar is acceptable, as long as the shade of blue isn’t too deep and accompanied with a power tie. This ode to Gekko works much better today in a light pink, baby blue, or lavender shirt, and without a tie.</li>
<li>Skip the monograms… Unless your initials are D.I.K.</li>
<li>No shirt pockets or collar buttons. This isn’t a 1994 Brooks Brothers catalogue.</li>
<li>Make sure your shirts are tapered appropriately. If you want to see how ridiculous ‘blousy’ looks, go back and watch some old Seinfeld reruns.</li>
<li>Have new shirts made every year and donate the old ones to Career Gear, a great non-profit that provides interview <keyword id="15176" type="ORGANIZATION" weightage="60" keywordseo="clothes">clothes</keyword> to low income individuals.</li>
<li>French cuffs are fine, provided that the cufflinks aren’t straight out of the Donald J. Trump collection.</li>
<li>And if you sweat, wear a damn undershirt, you slob. Besides, a $50 t-shirt will save numerous $200 dress shirts from your disgusting armpits.</li>
</ul>
Ties
<ul>
<li dir="ltr">
It’s all about the Windsor knot, with the perfectly symmetrical triangle. A half or full Windsor are both fine, depending on the thickness of the tie and the spread of the collar.
</li>
</ul>
MD#1: Handshakes and tie knots. I don't have time for someone that can't master those basic skills.
<ul>
<li>Skip the dimple that creates that obnoxious crease; you’re not Al Sharpton.</li>
<li dir="ltr">Sorry interns and analysts, no Hermès. </li>
</ul>
#1: Don't show up to an interview in a Hermès tie. I don't give a f*ck if you can afford it, you have to earn it.
#1: Hermes ties are like Air Jordans for white people.
<ul>
<li dir="ltr">
Everyone has a favorite tie, but don’t wear it every damn week.
</li>
</ul>
#1: There's nothing pretentious about keeping a tie journal. It keeps me on a solid 10-12 week rotation.
Suit Jacket
<ul>
<li>You can’t go wrong with two-button, notched-lapel, and single-breasted. Skip the three-button suit altogether.</li>
<li dir="ltr">Absolutely no double-breasted herringbone. It’s gone and never coming back. Sorry, David Letterman.</li>
<li dir="ltr">Avoid the peaked lapel, unless it’s on a single-button, casual suit.</li>
<li dir="ltr">In terms of color, keep it to various shades of gray and navy, with a few varieties of pinstripes. That’s all you need.</li>
</ul>
#1: Is that a brown suit? The back office is in Jersey City, pal.
<ul>
<li>No need to go above 160 per inch thread count. Between the abrasive Herman Miller chairs and the drunken nights out, they don't last.</li>
<li>And it goes without saying; buy as many suits as you can reasonably afford.</li>
<li>But don’t waste your money buying off-the-rack at Barney’s or Bergdorf; go bespoke. </li>
</ul>
#1: Gucci suits are like Corvettes. They're a great way of telling people you didn't always have money.
<ul>
<li dir="ltr">It’s a cliché because it’s true; the most expensive suit is the one you wear the least.</li>
</ul>
#1: I spent $2,000 on a suit I don't need or like, just to impress a sales chick I don't find attractive.
Business Casual
<ul>
<li>If you're not in the US, lose the khakis.</li>
<li dir="ltr">Sweaters over a collared shirt? For the most part, no problem. </li>
</ul>
 #1: Why do people wear wool if they know cashmere exists?
 #1: There is no such thing as turtleneck weather.
<ul>
<li dir="ltr">
Stick with Polo shirts; no one cares to watch you inevitably mime golf swings.
</li>
</ul>
#1: Nothing says douchebag quite like wearing an Augusta golf shirt when the Masters are on.
Watches
<ul>
<li dir="ltr">I saw an Associate get picked off for sporting a new Daytona the week before bonus. A quick "if you want watches to matter, go work at Morgan Stanley" wiped that smirk right off his face.</li>
</ul>
#1: Wearing a Rolex is like driving an Audi. It says you've got some money, but nothing to say.
<ul>
<li dir="ltr">
Thanks to Hank Paulson, Nike running watches and Livestrong bracelets were to 2004 what Lloyd's stubble beard has been to 2012-13. There are quite a few senior guys that still wear a Nike sport watch, intentionally, or even no watch at all.
</li>
</ul>
#1: Not wearing a watch is the new Patek.
<ul>
<li dir="ltr">
Forget all about Hublot. It’s a great way to tell people that you’re an idiot who has more money than taste. Hublot was a second-rate brand with third-rate craftsmanship until about 15 years ago when they arbitrarily doubled the price and started paying celebrities and sport figures to wear them. It's been a marketers wet dream.
</li>
</ul>
 #1: Hublot put the ‘whore’ in ‘horology’ 
Miscellaneous Tips
<ul>
<li>Pocket squares are for washed-up, unemployable ex-bankers, turned CNBC guest pundits, i.e. a guy who takes himself far too seriously and has a massive chip on his shoulder.</li>
<li dir="ltr">Wedding rings, watches, and cufflinks are the only acceptable form of jewelry for a man. Unless the Dalai Lama gave you that bracelet, leave it at home.</li>
</ul>
#1: In New York, don't trust a banker with a pocket square. In London, it's a pinky ring. And in Asia, don't f--king trust anyone.
<ul>
<li dir="ltr">
Like Ambien and red wine, the wrong fashion combination can become a disastrously lethal cocktail of Larry Kudlow-esque proportions. 
</li>
</ul>
MD #1: A double-breasted suit and a blue shirt with a white collar? Was it a rough night in the water bed?
#1: Plaid shirt, bow tie, and pocket square is the douchebag trifecta. 
<ul>
<li dir="ltr">
Finally, "an architect is only as good as his builder, and a fashion designer is only as good as your tailor."
</li>
</ul>
There you have it; head to toe. These tips won’t exactly get you laid at Soho House or on the cover of GQ; but on Wall Street and in business, you can’t go wrong taking this advice.
Just don’t go out and break the law or get scapegoated… Ask any juror, Fabrice Tourre’s ‘fabulous’(?) and expensive-looking fashion sense was a coffin nail come deliberation time.

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