We’ve been reading SEC filings for more than 35 years. We have to sadly say that the 10-Q that Goldman Sachs filed with the SEC on May 2, for the quarter ending March 31, 2022, shocks even our well-documented assessment of Wall Street as a crime syndicate. Goldman Sachs has listed pretty much everything the firm does as a target of an ongoing investigation, notwithstanding that the company and a subsidiary were criminally charged by the U.S. Department of Justice in the looting and bribery scandal known as 1MDB in October 2020, admitted to the charges, and had to pay over $2.9 billion. The good news is that Goldman Sachs’ Dark Pools are one of the areas it lists as being under a probe.
Dark Pools (also benignly called Alternative Trading Systems or ATS) are effectively unregulated stock exchanges being run by the same megabanks on Wall Street that blew up the U.S. financial system in 2008 and received the largest taxpayer bailout in U.S. history. The radical right in the U.S. Congress apparently believes that unbridled greed and outrageously reckless conduct that craters America’s economy deserves to be rewarded with less regulatory oversight, thus Dark Pools have not been shut down.
Not only are Goldman Sachs, JPMorgan, UBS, Morgan Stanley, Merrill Lynch, and numerous others, allowed to trade hundreds of New York Stock Exchange and Nasdaq listed stocks in their own Dark Pools, but they are also allowed to trade their own bank’s stock in their own Dark Pools. We have asked the SEC for years now how it is legal for a bank to trade its own stock – possibly making a two-sided market in that stock because some of these firms own more than one Dark Pool. We’ve yet to receive an answer. (Dare we hope that this is finally being seriously investigated by Gary Gensler’s SEC?)