mortgages and selling them off to investors around the world. other people at goldman sachs took a different view in december of 2006 and throughout 2006 saying that, hey, we think there s real problems in the mortgage market. we as a firm will find ways to bet against the mortgage market. at the same time other colleagues are packing up and acting as middlemen to sell the mortgage securities to the public. both things were going on at goldman at the same time. that s what distinguished them at other firms. at other firms they are merrill, they hadn t made the secondary bet that the market may fail. they made profit in 2007 when other firms lost money. when we were on the brink of financial ruin as they call it. the truth is nobody knew. some people obviously knew. nobody knew which way the bet would come out.
sachs, charged with civil fraud in connection with its subprime mortgages. the securities exchange commission alleges the investment firm defrauded investors by selling securities to one group while letting another bet against them. the firm calls the charges, quote, completely unfounded. tax payers already cover their room and board, turns out the irs has been paying prisoners too. cnn s john zarrella looks at a tax scheme that has raked in millions. reporter: just a routine search of a jail cell. officer mark lindhback didn t expect to find much. after the inmates exited the cell, went over, basic, pulled up the mattress, had some items on his mattress, additional items underneath the bunk. reporter: the items, tax form and address book with social security numbers, birth dates and cheat sheets for filling out returns. that was december of 2006. what lindhback had stumbled upon was a lucrative income tax fraud
all day and all night. new zegerid otc. discover the difference. and look for $4 savings in sunday s paper. as a taxpayer, you are covering the room and board of prisoners. well, it also turns out the irs is also paying the prisoners as well. c nch cnn s john zarrella looks at a tax scheme that rakes in millions. reporter: just a routine search of a jail cell. this officer didn t expect to find much. after the inmates have exited the cell, went over, basic, pulled up the mattress. he had some of the items under his mattress. additional items underneath the bunk. reporter: tax forms, an address book with social security numbers, birth dates and cheat sheets for filling out returns. that was december of 2006.
expect to find much. after the inmate has exited the cell. went over, basically pulled up the mattress. he had some of the items under his mattress. additional mattress underneath the bunk. reporter: the items, tax forms and address book with social security numbers, birth dates and cheat sheets for filling out returns. that was december of 2006. what lindback stumbled upon was a scheme run by inmates at the monroe county jail near i can west. before they were busted they filed for more than $1 million in tax refunds involving half the jail population. but what they would do is go to other inmates and suggest to an inmate, i can get you $4500 in a tax return. it will cost you $500. reporter: in some cases with the help of friends and family, the prisoners would fill out the 1040 ez short form. then attach a 4852 form with the names of businesses that didn t
personal atms, so tax day for the inmates was a really big day. just a routine search of a jail cell. officer mark linback didn t expect to find much. after the inmates in the cell, went over, basically pulled up the mattress. he had items under the mattress, additional items underneath the bunk. reporter: the items, tax forms with social security numbers, birth dates and cheat sheets for fill ought returns. that was december of 2006. what lindback had summered upon was a lucrative tax fraud scheme reason by inmates at the monroe county jail near key west. before they were busted the inmates filed for more than $1 million in tax refunds, involving half the jail population. but what they would do is go to other inmates and suggest to an inmate, i can get you 4,500 in a tax return it will cost