Phil Gramm's Swiss bank client has been one of the worst hit banks in the world due to the subprime banking crash which is linked to the Gramm-Leach-Bliley Act that the retired Texas Senator promoted before leaving the Senate and working for UBS. After showing initially profitable results, the banking world has since reminded some of why we had particular banking laws in place since the Great Depression. Gramm ignored history and thought he knew better. As the credit crisis grew Gramm, a Washington insider, was tasked with lobbying Congress to ease the pain of the problem he helped create.
The latest scandal to involve the McCain campaign co-chair lobbyist are investigations into UBS by the SEC as well as regulators from Massachusetts and New Hampshire. Is there a "20 strikes and you're out" policy in the McCain team? If you thought ties to Halliburton and Big Oil were bad with Bush, that's nothing compared to Wall Street problems and McCain.
UBS Financial Services Inc. knew as early as December that a segment of the municipal bond business was in trouble, but the Wall Street firm kept selling the investments to some clients without warning them of the risk, according to documents reviewed by the Globe.
By February, the $330 billion auction-rate securities market had collapsed, locking out the nonprofits and municipalities that had used the market for years to issue inexpensive debt, as well as the investors who had purchased it. UBS brokers have said they were as surprised as anyone about the market's shutdown.
