Remember the story about the Wall Street guy who rented out all 94 rooms of an Aspen hotel for three days for his daughter's Bat Mitzvah?
The main character in that tale was an individual named Jeffrey Verschleiser, a former Bear Stearns executive who was instrumental in helping blow up that venerable firm. Verschleiser among other things was reportedly involved with an elaborate Wall Street version of a merchandise return scam, only instead of taking the proceeds from returned TVs and stereos, his unit was pocketing the cash from crap mortgages sold back to banks on behalf of investors.
Verschleiser also made a bundle burning Bear's bond insurers, whom he bet against after inducing them to insure his crappy mortgage bonds, nicknamed "Sack of Shit" bonds by one of the funny dudes in his department. Verschleiser reportedly bragged that he made $55 million shorting his own bond insurers in the space of three weeks. Those interested in the whole sorry story should check out reporter Teri Buhl's excellent Atlantic magazine piece entitled, "E-mails Suggest Bear Stearns Cheated Clients Out of Billions."
After Verschleiser decided to monopolize the elegant Hotel Jerome in Aspen for his daughter's Bat Mitzvah, news reports about his identity leaked out, and the event spurred some local controversy in Aspen and plenty of inflamed commentary around the interwebs. But it seems that the negative press has not hurt Verschleiser's career. This is from Bloomberg today:
Goldman Sachs Group Inc. (GS), the fifth-biggest U.S. bank by assets, named Justin Gmelich global head of credit trading as part of management changes in the wake of high-level departures.
Jeffrey L. Verschleiser will become global head of mortgage trading, according to an internal memo obtained by Bloomberg News. Gmelich and Verschleiser fill roles that were held by Donald R. Mullen until his departure earlier this year. Michael DuVally, a spokesman for the New York-based firm, confirmed the memo’s contents.
I'm sometimes asked if I've noticed any change in Goldman Sachs since the financial crash of 2008. I'd suggest that anyone who would ask that question simply check out this news item. It's not merely that Verschleiser appears to be a titanically entitled asshole of the Let-Them-Eat-Cake variety; it's also that this is a guy who was personally named in a number of major lawsuits involving exactly the sorts of tawdry behaviors that caused the crash -- like knowingly dumping "sack of shit" mortgages on the market, or betting against your own clients after sticking them with millions' worth of defective products.
So this guy, who made the news both for his professional unscrupulousness and for his personal assholedom, is the guy that Goldman picks to head its global mortgage operation.
As the Russians say: submitted without commentary.