Thomson Reuters featured an excerpt from a forthcoming study by Professors Bradley Borden and David Reiss about mortgage securities investors facing huge tax losses and the so-called “Wall Street Rule.” When investors lose money due to the improper structuring of tax-advantaged securities by bankers, they explained, the IRS applies the Wall Street Rule, which protects the investment companies from lawsuit damages.
|Prof. Bradley Borden|
Professors Borden and Reiss describe the history of these practices and the tax loopholes that have allowed them to continue, arguing that industry-wide reform is needed. “If the rule of law is respected, then Main Street can look forward to the equal protection of the law and returned prosperity without fear of bubbles inflating because powerful special interests can flout the law that applies to the rest of us.”
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