Goldman Said to Get Subpoena From Manhattan Prosecutor Over Senate Report
Goldman Sachs Said to Receive Subpoena
Jin Lee/Bloomberg
Goldman Sachs Group Inc. has dropped 16 percent in New York trading since the Senate subcommittee, led by Michigan Democrat Carl M. Levin, used the firm as a case study in a 640-page report on its findings released in April.
Goldman Sachs Group Inc. has dropped 16 percent in New York trading since the Senate subcommittee, led by Michigan Democrat Carl M. Levin, used the firm as a case study in a 640-page report on its findings released in April. Photographer: Jin Lee/Bloomberg
June 2 (Bloomberg) -- John Coffee, a securities law professor at Columbia University, Charles Peabody, an analyst at Portales Partners LLC, and Jacob Zamansky, a securities-arbitrage attorney with Zamansky & Associates LLC, offer their views on a report that Goldman Sachs Group Inc. received a subpoena from the Manhattan District Attorney's office seeking information on the firm's activities leading into the credit crisis. This report also contains comments from Andrew Stoltmann, a Chicago lawyer who represents investors in securities litigation; David Goldman, a private investor and a columnist for the Asia Times, and William Cohan, author of "Money and Power: How Goldman Sachs Came to Rule the World" and a Bloomberg View columnist. (Source: Bloomberg)
June 2 (Bloomberg) -- Jacob Frenkel, a partner at Shulman Rogers Gandal Pordy & Ecker PA, Michael Perino, a professor of securities law at St. John’s University, and Bloomberg's Christine Harper talk about a report that Goldman Sachs Group Inc. was subpoenaed by the New York Attorney General's office for information on the firm’s activities leading into the credit crisis. They speak with Pimm Fox on Bloomberg Television's "Taking Stock." (Source: Bloomberg)
June 2 (Bloomberg) -- Jacob Zamansky, a securities-arbitrage attorney with Zamansky & Associates LLC, talks about a report that Goldman Sachs Group Inc. received a subpoena from the Manhattan District Attorney’s office seeking information on the firm’s activities leading into the credit crisis. Zamansky filed a class-action lawsuit on April 30 on behalf of Goldman shareholders, saying the bank made false statements relating to a Securities and Exchange Commission lawsuit alleging Goldman had committed fraud in underwriting and marketing a mortgage-related security called Abacus 2007-AC1 without disclosing to clients that a bearish hedge fund customer, Paulson & Co., was involved in creating it. Zamansky speaks with Lisa Murphy on Bloomberg Television's "Fast Forward." (Source: Bloomberg)
June 2 (Bloomberg) -- Douglas Burns, a formal federal prosecutor, talks about the Manhattan District Attorney's office subpoena of Goldman Sachs Group Inc. Goldman, the fifth-biggest U.S. bank by assets, is being asked to turnover information on the firm’s activities leading into the credit crisis, according to two people familiar with the matter. Burns speaks on Bloomberg Television's "InBusiness with Margaret Brennan." (Source: Bloomberg)
June 2 (Bloomberg) -- William Cohan, author of "Money and Power: How Goldman Sachs Came to Rule the World" and a Bloomberg View columnist, discusses a report that the Manhattan District Attorney's office subpoenaed Goldman Sachs Group Inc. for information on the firm's activities leading into the credit crisis. He speaks on Bloomberg Television's "InBusiness with Margaret Brennan." (William D. Cohan is a Bloomberg View columnist. The opinions expressed are his own. Source: Bloomberg)
June 2 (Bloomberg) -- William Isaac, chairman of Fifth Third Bancorp, talks about a report that Goldman Sachs Group Inc. received a subpoena from the Manhattan District Attorney’s office concerning the firm's activities leading into the credit crisis and the state of financial regulation in the U.S. Isaac speaks with Carol Massar and Matt Miller on Bloomberg Television's "Street Smart." (Source: Bloomberg)
June 2 (Bloomberg) -- Goldman Sachs Group Inc., the fifth-biggest U.S. bank by assets, received a subpoena from the Manhattan District Attorney’s office seeking information on the firm’s activities leading into the credit crisis, according to two people familiar with the matter. Bloomberg's Christine Harper speaks with Betty Liu on Bloomberg Television's "In the Loop." (Source: Bloomberg)
Goldman Sachs Said to Get Subpoena
Scott Eells/Bloomberg
A pedestrian passes in front of 200 West Street, which houses the headquarters of Goldman Sachs Group Inc., in New York on June 2, 2011.
A pedestrian passes in front of 200 West Street, which houses the headquarters of Goldman Sachs Group Inc., in New York on June 2, 2011. Photographer: Scott Eells/Bloomberg
Lloyd Blankfein
Jemal Countess/Getty Images for Time Inc.
Goldman Sachs Group CEO and chairman Lloyd Blankfein attends the Fortune Most Powerful Women summit on October 4, 2010 in Washington, DC.
Goldman Sachs Group CEO and chairman Lloyd Blankfein attends the Fortune Most Powerful Women summit on October 4, 2010 in Washington, DC. Photographer: Jemal Countess/Getty Images for Time Inc.
Goldman Sachs Said to Get Subpoena
Andrew Harrer/Bloomberg
The headquarters of the Goldman Sachs Group Inc.
The headquarters of the Goldman Sachs Group Inc. Photographer: Andrew Harrer/Bloomberg
Goldman Sachs Group Inc. (GS), the fifth- biggest U.S. bank by assets, was subpoenaed by the Manhattan District Attorney’s office for information on the firm’s activities leading into the credit crisis, two people familiar with the matter said.
The subpoena relates to the U.S. Senate’s Permanent Subcommittee on Investigations report on Wall Street’s role in the collapse of the financial markets, which accused New York- based Goldman Sachs of misleading buyers of mortgage-linked investments, the people said, speaking on condition of anonymity because the inquiry isn’t public.
Goldman Sachs has dropped 16 percent in New York trading since the Senate subcommittee, led by Michigan Democrat Carl M. Levin, used the firm as a case study in a 640-page report on its findings released in April. At the time, Levin said Goldman Sachs had also misled Congress about the company’s bets on the housing market. The firm has said its testimony was truthful.
“We don’t comment on specific regulatory or legal issues, but subpoenas are a normal part of the information request process and, of course, when we receive them we cooperate fully,” said David Wells, a company spokesman.
A subpoena is a request for information and doesn’t mean the company is a target of a criminal investigation. Analysts including Sanford C. Bernstein & Co.’s Brad Hintz have said they don’t expect the firm to be criminally prosecuted.
Erin Duggan, chief spokeswoman for Manhattan District Attorney Cyrus Vance Jr., declined to comment.
Shares Decline
Goldman Sachs dropped 1.3 percent to $134.38 in New York Stock Exchange composite trading yesterday.
The Senate report was referred to the U.S. Department of Justice and the Securities and Exchange Commission, which are also investigating.
Levin said when his report was released that federal prosecutors should review whether to bring perjury charges against Goldman Sachs Chairman and Chief Executive Officer Lloyd Blankfein, 56, and other current and former employees who testified to Congress last year. Levin said they denied under oath that Goldman Sachs took a financial position against the mortgage market solely for its own profit, statements the senator said were untrue.
Schneiderman’s Probe
Goldman Sachs met last month with New York Attorney General Eric Schneiderman’s office as part of his examination of mortgage securitization before the housing collapse, according to a person familiar with the matter, who spoke on the condition of anonymity because the probe isn’t public. The meeting took place within the past two weeks, the person said.
Schneiderman has been conducting a broad examination of mortgage practices and the packaging and sale of loans to investors, according to the person. JPMorgan Chase & Co. (JPM), UBS AG (UBSN), Deutsche Bank AG (DBK), Bank of America Corp. (BAC), Morgan Stanley (MS) and the Royal Bank of Scotland Group Plc (RBS) also are part of that investigation, the person said. Four bond insurers have been subpoenaed as well.
Lauren Passalacqua, a spokeswoman for Schneiderman, declined comment, as did Goldman Sachs’s Wells.
Last year Goldman Sachs paid $550 million to settle SEC claims related to its marketing of the complex securities known as collateralized debt obligations. The settlement resolved claims that the company failed to disclose that hedge fund Paulson & Co. was betting against, and influenced the selection of, CDOs the company was packaging and selling.
To contact the reporter on this story: Christine Harper in New York at charper@bloomberg.net
To contact the editor responsible for this story: David Scheer at dscheer@bloomberg.net.
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