A compendium of Goldman's legal woes
Goldman Sachs needed 11 pages to summarize all the legal problems it's facing.
The Wall Street firm's quarterly report, filed Tuesday, groups the lawsuits, arbitrations and investigations that the bank is facing into 17 sections, the longest of which deals with continuing fallout from the bank's handling of mortgage-related assets before and during the crisis. Last summer, Goldman paid $550 million to settle a lawsuit brought by the Securities and Exchange Commission accusing the bank of misleading investors about the quality of one particular mortgage-linked security sold by the firm.
The settlement, however, did not put the matter to rest. The bank is now being sued by shareholders, investors and others who say they were hurt by the deal. In a new revelation, the quarterly report says Goldman has been subpoenaed by other regulators in connection with mortgage-related securities, including the transaction that the SEC suit dealt with, "and is cooperating with these regulators."
Outside of the mortgage realm, Goldman is being investigated for its dealings with the government of Greece, its handling of municipal bonds and its sales of credit default swaps -- all of which were previously disclosed.
In a new disclosure, the firm said the staff at the Commodity Futures Trading Commission has recommended that the commission bring civil charges against Goldman for the way its clearing division handled the accounts of one of its clients, another securities broker. The report included few details, and a Goldman spokesman declined to comment further.
The company also noted, without comment, that news organizations had reported that a Senate investigative committee had recently forwarded its recent findings about Goldman, in a report about the financial crisis, to the Justice Department.
Goldman's shares added $1.28 to $150.40 on Tuesday. But the stock is down 10.6% year to date while the stock market overall has rallied. The Standard & Poor's 500 index is up 7.9%.
-- Nathaniel Popper