Eliot Spitzer Case

Eliot Spitzer, attorney general of New York Investment Protection Bureau, was the leading regulator who changed the way many Wall Street firms do business. What he accomplished was nothing short of extraordinary – he has not only stood up for the investors against Wall Street giants, but he did so in such an aggressive but rightful manner that required much courage and sophistication. Many criticized Spitzer for his overly aggressive indictments and actions against Wall Street firms, which consisted releasing the Merrill Lynch’s incriminating emails on the national television as well as releasing firms’ civil charges to public before the court ruled on the case. However, his rationale behind it was that many Wall Street firms have taken shelters under legal settlements – usually led by SEC or other government regulation agencies – that would withhold the scandalous details of their charges and only require firms to pay some fines. These firms’ reputations would remain intact and the public would not have any awareness of the “corrupt business models” that many of these firms have been practicing. That is why many firms continue to make fraudulent, deceitful deals that would rip off their clients, and drive up their profitability, knowing that the worst case scenario is them getting caught and having a pay some type of fine to settle the case. Therefore, Spitzer releasing the incriminating details of Wall Street firms to the public, though a bit unorthodox, is fair in my opinion. He did so for a rightful reason – to use the power of publicity to implant fears of committing frauds into Wall Street executives’ minds. He wanted to build a stronger deterrent against Wall Street firms’ ill practices. In addition to that, Spitzer’s actions are also legitimized by a rarely known New York State law called Martin Act. This Act, once invoked by attorney general, can prohibit a firm from continuing its allegedly fraudulent practices. Attorney generals can then