Goldman Pays $550M to Settle SEC Fraud Case

It's the largest such fine in history
By Newser Editors and Wire Services
Posted Jul 15, 2010 4:21 PM CDT
Goldman Sachs CEO Lloyd Blankfein is sworn in to testify before the Senate Subcommittee on Investigations in April.   (AP Photo/Susan Walsh)

(Newser) – Goldman Sachs has agreed to pay $550 million to settle civil fraud charges that accused the Wall Street giant of misleading buyers of mortgage-related investments. The deal calls for Goldman to pay the Securities and Exchange Commission fines of $300 million. The rest of the money will go to compensate those who lost money on their investments. The fine is the largest against a financial company in SEC history.

The settlement requires Goldman to review how it sells complex financial mortgage investments. Goldman acknowledged in a court filing that its marketing materials for the deal at the center of the charges omitted key information for buyers. The investments were crafted with input from a Goldman client who was betting on them to fail. The civil charges the SEC filed April 16 were the most significant legal action related to the mortgage meltdown that pushed the country into recession.

My Take on This Story
Show results without voting  |