Goldman Sachs Fails to Get Investors' CDO Suit Dismissed

Discussion in 'Stock Market' started by hvactec, Jun 23, 2012.

  1. hvactec
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    hvactec VIP Member

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    Jun 22, 2012 10:33 AM ET

    Goldman Sachs Group Inc. (GS) failed to win the dismissal of a lawsuit brought by shareholders claiming they were harmed by conflicts of interest related to collateralized debt obligation transactions.

    The U.S. Securities and Exchange Commission sued Goldman Sachs in April 2010, alleging fraud tied to CDOs that contributed to the worst financial crisis since the Great Depression. Goldman Sachs’s shares dropped about 13 percent after the lawsuit was filed. The firm paid $550 million to settle with the SEC, the largest penalty in the regulator’s history.

    U.S. District Judge Paul A. Crotty in Manhattan ruled yesterday that investors can proceed with a lawsuit alleging Goldman Sachs’s stock plummeted because the bank failed to disclose that it had bet against CDOs it sold to customers. Crotty dismissed arguments that Goldman Sachs made material misstatements or omissions regarding its receipt of warnings from the SEC that the company might be sued.

    read more Goldman Sachs Fails to Get Investors' CDO Suit Dismissed - Bloomberg
     
  2. g5000
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    g5000 Diamond Member

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    Rockin' good news soured only by the fact that everyone at Goldman involved in the Abacus deal, along with hedge fund manager John Paulson, should be in prison and won't be.
     

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