Goldman Sachs Links and News - May 4, 2010

Rochdale's Bove Discusses SEC Suit Against Goldman Sachs: Video ...
By Report Fraud 
What-Ifs for Goldman Sachs
Wall Street Journal
Buffett Turns Into One More Corporate Bubble: Alice Schroeder
BusinessWeek
Media Nation » Warren Buffett on the Goldman Sachs case
By Dan Kennedy 
Goldman Sachs fined, censured over 'naked' short sales
USA Today
Goldman Sachs Pays European Bankers Average of $670000
BusinessWeek
The Would-Be Governor From Goldman Sachs
Huffington Post (blog)
Too Late for Goldman Sachs to Play Offense?
BusinessWeek
NYT's Goldman Scoopster, Louise Story, Joins Bloomberg TV As Contributing Editor
The Business Insider
Ross, Like Buffett, Believes in Goldman Sachs: Tom Keene
BusinessWeek
Goldman Partners Give Blankfein Standing Ovation, Hintz Says
BusinessWeek
Warren Buffett Interviews From Omaha Goldman Sachs, Wall Street ...
By Jacob Wolinsky 
From Buffett, Thought-Out Support for Goldman
New York Times
The Goldman Sachs Riverboat Casino
Chicago Tribune
The Criminalization of Wall Street: Will Any Exec at Goldman Sachs ...
By BATR
A Call to Separate Top Goldman Jobs
New York Times
Goldman Sachs now hit with 6 shareholder suits
Washington Post
Buffett 'adds' a few thoughts on Goldman
MarketWatch
SEC's fraud case against Goldman generates shareholder suits ...
By Nathaniel Popper 
New Legal Woes To Ensnare Goldman Sachs? | www.bullfax.com
By marketmaker 
Goldman Sachs now hit with 6 shareholder suits
Washington Post
Cox Says Blankfein's Defense of Goldman `Not Credible': Video ...
By marketmaker 
  

Goldman Sachs Investigation Interview

Terri Gross interviews Gretchen Morgenson on Fresh Air from WHYY

Gretchen Morgenson, who covers the world financial markets for The New York Times, discusses the investigations into Goldman Sachs by the Securities and Exchange Commission, the Justice Department and a Senate subcommittee — and reflects on the role Goldman Sachs played in the financial crisis.

Goldman Sachs has been accused of defrauding investors by intentionally designing derivatives that Goldman Sachs knew would fail if and when the housing market collapsed — and then selling those derivatives to customers without telling them that these derivatives were designed to fail.

The SEC investigation hinges on whether Goldman should have disclosed more information to its customers, Morgenson says in an interview on Fresh Air.

"Goldman Sachs has strenuously denied that they have done anything wrong. In fact, they say, 'We didn't know the mortgage market was going to collapse and therefore, we could have been wrong. We were not in a position to know with certainty that it was going to collapse. But that's essentially the heart of the matter: Should they have disclosed to their customers who were buying this portfolio that, in fact, it had been almost rigged?" she says.

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Listen to the interview here

Goldman Sachs Pays $450,000 to Settle

Goldman Sachs Pays $450,000 to Settle NYSE Finding

May 4 (Bloomberg) -- Goldman Sachs Group Inc.’s execution and clearing unit agreed to pay NYSE Euronext and the Securities and Exchange Commission $450,000 to settle allegations it broke rules governing short sales on U.S. stocks because of a bookkeeping error.

Goldman Sachs was censured for violating the SEC’s Regulation SHO, which sets rules for handling bearish trades in equities. The infractions, which are unrelated to the SEC’s April 16 mortgage-related fraud suit against the world’s most profitable investment bank, involved requirements implemented in September 2008 to reduce naked short selling, in which firms sell stock short without intending to borrow the shares required to complete their obligations.

An emergency SEC rule implemented after Lehman Brothers Holdings Inc.’s collapse in September 2008 forced brokers to close short sales that didn’t settle by the morning of the fourth day after the trade. That regulation, called Rule 204T, also imposed stricter requirements on subsequent short sales when failures to deliver shares occurred. The rule was made permanent in July 2009.

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Jabba the Hutt: This Blankfein is my kind of scum: fearless and inventive.

Goldman- A Financial Reformer's Casus belli

From Tom Saler at the Journal Sentinal:

Goldman Sachs makes the case for financial reform

They're greedy. They're unethical. They're clever in a borderline nefarious way.

No one should be surprised that the much envied and equally loathed Wall Street investment bank Goldman Sachs may have sold clients securities that an internal Goldman e-mail described using a word that rhymes with itty-bitty.

There was nothing tiny, though, about the consequences of Goldman's sale of a collateralized debt obligation, known by the appropriately inscrutable title, Abacus 2007-AC1.

According to the Securities and Exchange Commission, a hedge fund with which Goldman collaborated put together a portfolio of high-risk mortgages, then pocketed $1 billion after it shorted the ill-fated CDO that Goldman subsequently placed with a German bank and a New York-based money manager.

That Goldman may have operated in a duplicitous (if not criminal) manner appears not to have dissuaded other investors from seeking the firm's advice and services, at least not yet. Goldman turned a $3.5 billion profit in the first quarter doing what its CEO, Lloyd Blankfein, once called "God's work."

Presumably, such work would not include helping the Greek government obfuscate its deplorable fiscal position through derivatives and then selling Greek government bonds to clients, as Goldman also is alleged to have done.

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Goldman Sachs hit with more lawsuits

More bad news for Goldman. Looks like they have their own oil spill heading their way.

Goldman Sachs said Monday that six private lawsuits alleging "breach of fiduciary duty, corporate waste, abuse of control, mismanagement and unjust enrichment" have been filed against the bank since the government charged it last month with committing fraud.

The rare announcement, in the form of a regulatory filing, underscores the widening legal assault that Goldman is facing as well as the firm's increasing sensitivity about telling investors any information that might be deemed pertinent.

The issue of disclosure is at the center of the Securities and Exchange Commission's civil fraud suit against the company. The SEC alleges that Goldman failed to tell clients looking to invest in the housing market important details about an investment opportunity the bank was touting, known as collateralized debt obligation. Goldman denies wrongdoing.

The private suits might not be the end of Goldman's legal challenges. Goldman said in its filing Monday that it expects more "regulatory and other investigations and actions commenced, with respect to offerings of collateralized debt obligations."

In addition, law enforcement sources said last week that the Justice Department is conducting a criminal investigation of Goldman's mortgage business. The sources, who spoke on the condition of anonymity, described the probe as preliminary.

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