“Bringing justice where fraud has occurred is a very important component to bringing back a culture of trust on which financial markets operate, and that’s why the Larry Langford trial is important,” says Robert Brooks, an economist at the University of Alabama in Tuscaloosa. “If you find transactions being done [by elected officials] with an effort to be opaque ... there’s good reason to wonder why.”
Justice Department investigations
The US Justice Department is investigating half a dozen former Wall Street investment bankers and scouring municipal bond deals from Florida to California, looking for more instances where taxpayers were essentially swindled by secretive gambling on the $2.8 trillion municipal bond market.
In the Langford case, “You basically had local officials setting terms, and the banks didn’t have a problem with that,” says Joe Adams, research coordinator at the Public Affairs Research Council of Alabama.
Langford’s alleged scheme involved a new fleet of financial instruments that hundreds of other cities and counties across the US have also utilized.