Tourre Tells Jurors ‘I Haven’t Done Anything Wrong’Bob Van Voris
Fabrice Tourre made one final attempt to convince jurors in Manhattan that he didn’t defraud investors in a 2007 mortgage bond-backed investment that lost them $1 billion when the U.S. housing market crashed.
“I haven’t done anything wrong, as I’m here literally to tell the truth and to clear my name,” Tourre, 34, said yesterday as he wrapped up his testimony in the trial of the U.S. Securities and Exchange Commission’s civil fraud case against him.
The SEC claims Tourre, a former vice president at Goldman Sachs Group Inc., hid the involvement of the hedge fund Paulson & Co. in selecting the mortgage bonds underlying the investment, known as Abacus 2007-AC1, and then made a $1 billion bet it would fail. The agency plans to rest its case against Tourre when the trial reconvenes July 29.
Tourre testified he made $1.7 million in salary and bonus in 2007. If found liable for fraud, he faces money penalties and a possible ban from the securities industry.
Tourre told jurors yesterday that he learned in April 2010 the SEC was suing him and Goldman Sachs over Abacus from a news headline scrolling on his Bloomberg terminal. At the time, he was working in London after moving there from New York, where he had structured and marketed Abacus.
Tourre, a French citizen, said he voluntarily testified before a U.S. Senate subcommittee in 2010. After that he “had to take a step back and think about what to do,” as his career had been “effectively destroyed” by the allegations. Tourre was placed on paid leave by Goldman Sachs for one year, at his base salary of about $750,000. He said he hoped he’d be able to return to the firm.
“I was hoping I could make the SEC understand this transaction,” he said.
Tourre told jurors he did volunteer work in East Africa and is now pursuing a doctorate in economics at the University of Chicago.
The SEC called Tourre to the stand the afternoon of July 24. He testified all day July 25 and part of yesterday morning.
Two days ago, Tourre told jurors about working at Goldman Sachs, six days a week, often until midnight.
“I would say there were thousands of vice presidents at Goldman,” Tourre said.
Tourre’s lead lawyer, Pamela Chepiga, sought to minimize Tourre’s responsibility for the Abacus transaction by highlighting his relatively junior status and showing that the transaction was reviewed by dozens of people at Goldman Sachs.
Tourre was called as a witness by the SEC and was questioned by both sides. He isn’t expected to testify again when his defense team presents its case next week.
The case is SEC v. Tourre, 10-cv-03229, U.S. District Court, Southern District of New York (Manhattan).