U.S. Sen. Bernie Sanders said a $5 billion legal settlement with Goldman Sachs over the sale of junk securities before the 2008 financial crisis is the latest evidence that the business model on Wall Street is fraud.
“Goldman Sachs is one of the major financial institutions in our country. What they have just acknowledged to the whole world is that their system…is based on fraud,” Sanders told an armory packed with supports at one of three rallies as he crisscrossed New York.
The deal announced by the Justice Department in Washington, D.C., spared individuals from prosecution. Sanders called that an example of “the corruption of our criminal justice system.”
The settlement involved the sale of mortgage-backed securities before the housing bubble burst and led to the Great Recession.
It is the subject of a TV ad Sanders will begin airing in New York. Goldman “just settled with authorities for their part in the crisis that put seven million out of work and millions out of their homes,” the narrator explains. “Our economy works for Wall Street because it’s rigged by Wall Street and that’s the problem,” the ad says. “As long as Washington is bought and paid for we can’t build an economy that works for people.”
Sanders has proposed a plan, backed by 170 economists and financial experts, to remake the financial system to serve America’s working families.
Sanders spoke about the Goldman deal during a rally here in Albany in advance of next Tuesday’s primary election. Sanders campaigned earlier in the day in Binghamton and was headed for a nighttime rally in Buffalo.