William Black and Eliot Spitzer reveal some essential questions that the SEC and Goldman have yet to answer:

Did John Paulson and ACA know that Goldman was making these false disclosures to the CDO purchasers? Did they “aid and abet” what the SEC alleges was Goldman’s fraud? Why have there been no criminal charges? Why did the SEC only name a relatively low-level Goldman officer in its complaint? Where are the prosecutors?

Under President Obama, the SEC is starting to wake up from an eight year slumber under George W. Bush - but, they still have much work to be done. Under George W. Bush and his SEC head Christopher Cox, the SEC was asleep at the wheel. Not only did the SEC under Bush and Cox make few major moves against fraudulent banksters, they were so incompetent that a senior attorney and accountant nearly got away with downloading tens of thousands of pornographic images on the job. It's time for groups like the Financial Crisis Inquiry Commission (FCIC) to investigate the SEC under Bush and Cox.

Novel idea:

The three of us, as experienced investigators and prosecutors of financial fraud, cannot answer these questions now. But we know where the answers are. They are in the trove of e-mail messages still backed up on A.I.G. servers, as well as in the key internal accounting documents and financial models generated by A.I.G. during the past decade. Before releasing its regulatory clutches, the government should insist that the company immediately make these materials public. By putting the evidence online, the government could establish a new form of “open source” investigation.

Once the documents are available for everyone to inspect, a thousand journalistic flowers can bloom, as reporters, victims and angry citizens have a chance to piece together the story. In past cases of financial fraud — from the complex swaps that Bankers Trust sold to Procter & Gamble in the early 1990s to the I.P.O. kickback schemes of the late 1990s to the fall of Enron — e-mail messages and internal documents became the central exhibits in our collective understanding of what happened, and why.

So far, prosecutors and regulators have been unable to build such evidence into anything resembling a persuasive case against any financial institution. Most recently, a jury acquitted Bear Stearns employees of fraud related to the collapse of the subprime mortgage market, in part because available e-mail messages suggested the employees had done nothing wrong.

Perhaps A.I.G.’s employees would also be judged not guilty. But we would like to see the record to find out. As fraud investigators, we would like to examine the trading patterns of A.I.G.’s financial products division, and its communications with Goldman Sachs and other bank counterparties who benefited from the bailout. We would like to understand whether the leaders of A.I.G. understood that they were approaching a financial Armageddon, and whether they alerted their counterparties, regulators and shareholders to the impending calamity.

Sunshine is the best disinfectant. We, the people, own these companies, and, as the owners, we have a right to know what they've been up to... especially since their actions contributed to the worst economic crisis since the Great Depression! We're the ones that are suffering the most from this economic catastrophe. We deserve to know what caused this crisis. Sunshine will lead us to the truth.

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