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Feds Open Criminal Investigation Of Goldman Sachs


By

Jen Chung

Published Apr 30, 2010

Modified Apr 30, 2010


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By

Jen Chung

Published Apr 30, 2010

Modified Apr 30, 2010


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Everyone's favorite target these days is now under criminal investigation. Federal prosecutors are now looking to whether Goldman Sachs' employees in mortgage trading operation committed securities fraud. The investigation apparently stems from the SEC's civil fraud lawsuit against Goldman regarding mortgage trading. The Wall Street Journal reports it's unclear whether charges will be brought, adding, "Many criminal investigations are launched that never result in any charges."

According to the NY Times, "Federal prosecutors would face a higher bar in bringing a criminal case against Goldman, whose role in the mortgage market came under sharp scrutiny this week during a marathon hearing in the Senate. In contrast to civil cases, the burden of proof is higher in criminal ones, where prosecutors must prove their case beyond a reasonable doubt." The Times points to how the U.S. Attorney's office lost the fraud suit against Bear Stearns hedge fund managers.

A lawyer told Bloomberg News that a criminal case against Goldman could be difficult, since it's "highly complex." Douglas Jensen, a former federal prosecutor, said, "In order to proceed criminally in a case, you need to have very clear evidence of lying, cheating and stealing."

Goldman Sachs' spokesman said it "would fully cooperate with any requests for information. Given the recent focus on the firm, we’re not surprised by the report of an inquiry."

Tagged

criminal investigation

economy

federal prosecutors

fraud

goldman sachs

mortgage

mortgage trading

SEC

us attorney's office


Jen Chung

Jen Chung is a former WNYC and Gothamist editor.

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Gothamist is funded by sponsors and member donations


Gothamist is funded by sponsors and member donations


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