Goldman Sachs Endured SEC’s Tough Questions
In the world of business, Goldman Sachs has been the most talked about this time. As a little background, The Goldman Sachs Group, Inc is a global investment banking and securities firm which engages in investment banking, securities services, investment management and other financial services primarily with institutional clients.
Monday, the company reported its first quarter earnings and it has revealed $3.5 billion profit. However, these results has not alleviate the scrutiny it faces. Days ago, the Securities and Exchange Commission (SEC) has filed a civil suit against Goldman, alleging that the New York City-based company allowed hedge fund Paulson & Co., who made billions of dollars betting against the U.S. mortgage market, to help select securities in a so-called collateralized debt obligation, or CDO. They also charged Goldman with failing to tell investors that Paulson was betting that the value of the investment would decline. Investors in the security ultimately lost $1 billion accordingly.
Executives of Goldman primarily reject SEC’s allegations and standing firm that Paulson never had a hand in selecting the securities and that the other investors in the deal were never deceived in any way.
Greg Palm, Goldman’s co-general counsel said, “We would never intentionally mislead anyone”. The company also mentioned that the two lone investors in the fund – German bank IKB and bond insurer ACA Capital – did their own extensive research. He also added that Goldman has had no “conversations” beyond the SEC’s civil charges.
As of the moment, the company has made it clear that has every intention of fighting the government’s charges and called it “unfounded”, adding that they planned to “vigorously contest” them.Follow us on Twitter to get free up-to-date news via tweets from the World Correspondents, or you can subscribe to us by entering your e-mail below. You can confirm your free subscription by clicking the confirmation link that will be sent to your e-mail address. Once you've confirmed, then you're good to go.