Three cheers for Jed Rakoff
Judge Jed Rakoff is my new hero: he’s put the kibosh on the proposed $33 million settlement between the SEC and Bank of America, on the grounds that BofA is admitting no wrongdoing, and there’s no indication of how the sum was calculated.
I hope this sends a clear signal to Mary Schapiro: quiet bilateral settlements with companies should come to an end, and as a rule all companies paying fines should at the same time admit, in public, exactly what they did wrong. All too often companies spin SEC fines as a cost of making legal trouble go away, rather than a real indication that they made a serious mistake. They shouldn’t be allowed to do that.