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While Fighting To Block SEC Investigation Of Goldman Sachs, Rep. Darrell Issa Bought Goldman Sachs Bonds

 
 
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Oversight Committee Chairman Rep. Darrell Issa (R-CA) raised hell last year to stop the federal government from investigating Goldman Sachs regarding allegations that the company defrauded investors. In April 2010, shortly after the Securities and Exchange Commission (SEC) announced a civil suit against Goldman Sachs, Issa sent a letter to SEC Chairwoman Mary Schapiro demanding to know if there was “any sort of prearrangement, coordination, direction from, or advance notice” between the SEC and the Obama administration or congressional Democrats over the timing of the lawsuit.

Issa’s investigation of the SEC’s investigation into Goldman Sachs stole the headlinesand reinforced Goldman Sach’s claim that they had done nothing wrong. Explaining his defense of Goldman Sachs, Issa said he was representing the views of ordinary Americans who are worried about the “growth of government and the growth of government wanting to become more complex, with more agencies and more control over our lives.”

However, recent personal finance disclosures reviewed by ThinkProgress paint a different picture of Issa’s motivations.  According to documents filed recently with the House Clerk, Issa went on a buying spree of high yield Goldman Sachs bonds at the same time he was running defense for the investment bank in Congress. From February to December of 2010, Issa bought 12 Goldman Sachs High Yield Fund Class Abonds, each worth up to $50,000 (view page 10 the disclosure here). Many of the bonds were purchased in the months after he filed his letter to the SEC. The $600,000 in new Goldman Sachs investments added to Issa’s already multimillion dollar stake in the company, valued from $5.1 to $15.5 million.

Issa has faced accusations that he has used his considerable political power to enrich himself. Earlier this year, ThinkProgress revealed that Issa had requested nearly $1 million in earmark projects that would have benefitted real estate owned by Issa and his family.

Around the time Issa launched his defense of Goldman Sachs and Republicans at-large ramped up efforts to stop President Obama’s financial reforms, Goldman Sachs and other major investment banks shifted their campaign donations mostly to Republican candidates.

Issa’s inquiry in defense of Goldman Sachs turned out to be completely bunk. In October, an Inspector General investigation found no wrongdoing by the SEC regarding Issa’s allegations. But for all the media attention Issa created with his request for an investigation into the SEC, he faced little to no blowback for being dead wrong. Meanwhile, a report this year authored by Sens. Tom Coburn (R-OK) and Carl Levin (D-MI) concluded that Goldman Sachs “misled clients and Congress about the firm’s bets on securities tied to the housing market.”

 

ThinkProgress / By Lee Fang

Posted at June 29, 2011, 6:22am

 
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