Goldman reveals further inquiries
By Steve Eder |
May 11, 2010, Tuesday
|
Print Edition
Print Edition
GOLDMAN Sachs Group Inc, facing fraud charges from United States securities regulators, yesterday warned that more litigation and investigations could be coming.
Goldman, in a quarterly regulatory filing, disclosed a number of probes and reviews that could be damaging to the Wall Street firm.
It said it anticipates additional shareholder actions and other investigations related to its offerings of collateralized debt obligations, which are at the heart of Securities and Exchange Commission charges against the firm.
Goldman shares have tumbled more than 20 percent since the SEC accused the bank on April 16 of failing to tell investors who bought risky debt tied to subprime mortgages that hedge fund manager John Paulson helped select the underlying portfolio for a mortgage-linked security and was shorting the deal.
Goldman, in its filing yesterday, said the SEC case "could result in collateral consequences to us that may materially adversely affect the manner in which we conduct our businesses" - namely its ability to act as broker-dealer or provide some advisory services to US mutual funds.
Goldman, criticized for not disclosing it had received notice last year of the likelihood of SEC charges, disclosed in the filing several investigations yesterday, including probes by the Financial Industry Regulatory Authority and Britain's Financial Services Authority related to CDO offerings and related matters.
Goldman, in a quarterly regulatory filing, disclosed a number of probes and reviews that could be damaging to the Wall Street firm.
It said it anticipates additional shareholder actions and other investigations related to its offerings of collateralized debt obligations, which are at the heart of Securities and Exchange Commission charges against the firm.
Goldman shares have tumbled more than 20 percent since the SEC accused the bank on April 16 of failing to tell investors who bought risky debt tied to subprime mortgages that hedge fund manager John Paulson helped select the underlying portfolio for a mortgage-linked security and was shorting the deal.
Goldman, in its filing yesterday, said the SEC case "could result in collateral consequences to us that may materially adversely affect the manner in which we conduct our businesses" - namely its ability to act as broker-dealer or provide some advisory services to US mutual funds.
Goldman, criticized for not disclosing it had received notice last year of the likelihood of SEC charges, disclosed in the filing several investigations yesterday, including probes by the Financial Industry Regulatory Authority and Britain's Financial Services Authority related to CDO offerings and related matters.
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