Goldman didn't tell SEC about mortgage moves for months

[kpete]

Source: McClatchy



* Posted on Friday, April 30, 2010

Goldman didn't tell SEC about mortgage moves for months

By Greg Gordon and Chris Adams | McClatchy Newspapers

WASHINGTON — In December 2006, Goldman Sachs embarked on a frantic effort to shed billions of dollars in risky mortgage securities and purchase exotic insurance to protect itself against what it had concluded could be the collapse of America's housing market.

Yet for nine months, until Sept. 20, 2007, the Wall Street giant didn't disclose its actions in key filings with the Securities and Exchange Commission, in telephone conferences with analysts or in its press releases.

A McClatchy review of hundreds of pages of subpoenaed company records released by a Senate panel Tuesday, as well as Goldman's SEC filings, has revealed how closely the company guarded its secret exit plan.

Goldman's failure to tell the investors who bought its risky mortgage securities that it had made an array of wagers against housing is at the heart of the furor now enveloping the nation's premier investment house, the only major Wall Street firm to exit the subprime mortgage market with minimal damage.




Read more: http://www.mcclatchydc.com/2010/04/30/93252/goldman-sought-to-shed-risky-mortgage.html#ixzz0mdvHseLc

[aquart]

1. Am I wrong or does McClatchy actually practice journalism?

[Jackpine Radical]

3. McClatchy--formerly Knight-Ridder--is the last bastion of old-fashioned real journalism

in the US, IMHO.

[chill_wind]

2. Yep. Insiders dumped their stock.

And didn't tell their shareholders.

4-25-10

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x8216507#top

CHICAGO (Reuters) - Five senior executives at Goldman Sachs Group Inc sold company stock after the firm received notice of possible fraud charges, according to a report in the Wall Street Journal.

The stock sales, which totaled $65.4 million, were made by co-general counsel Esta Stecher, vice chairmen Michael Evans and Michael Sherwood, principal accounting officer Sarah Smith and board member John Bryan.

K & R.

[tavalon]

4. Gee, when Martha Stewart does that, it's illegal

I wonder if it's the same for these guys? Nah.

[tomm2thumbs]

5. '...shhhh.. be vewwy vewwy quiet - we're hunting profits'

9 months

and I bet they would have waited until after the election if they had the opportunity - if things hadn't literally fallen down around them

[TacticalPeek]

6. That disclosure was made neither "promptly" nor "simultaneously". Oh, my!

Regulation FD (Fair Disclosure) is a new issuer disclosure rule that addresses selective disclosure. The regulation provides that when an issuer, or person acting on its behalf, discloses material nonpublic information to certain enumerated persons (in general, securities market professionals and holders of the issuer's securities who may well trade on the basis of the information), it must make public disclosure of that information. The timing of the required public disclosure depends on whether the selective disclosure was intentional or non-intentional; for an intentional selective disclosure, the issuer must make public disclosure simultaneously; for a non-intentional disclosure, the issuer must make public disclosure promptly.

http://www.sec.gov/rules/final/33-7881.htm

[midnight]

7. Silence is golden according to the decision to keep risky mortgage securities

a secret so that profitability can be maximized when betting against it. I wonder how much the ratings industry made in this venture?

[TacticalPeek]

8. Daylight kick.

:kick:

[Ghost Dog]

9. Goldman Loses Room to Maneuver After Public Testimony

Source: Bloomberg

April 30 (Bloomberg) -- Goldman Sachs Group Inc. may have backed itself into a corner by speaking out quickly to counter fraud claims by the U.S. Securities and Exchange Commission.

In the two weeks since the SEC filed its lawsuit, Goldman Sachs has released multiple written defenses, sent executives to Capitol Hill for sworn testimony and put Chief Executive Officer Lloyd Blankfein on television to explain the firm’s conduct as the housing market soured. While broadcasting its story, the New York investment bank also has given regulators, lawmakers and law enforcement agencies material to scour for contradictions that could weaken its defense.

...

“Going under oath and committing yourself before you have any idea what kind of a case might be brought against you -- and more particularly what the evidence in that case might be -- is going to seriously curtail a defense lawyer’s ability to find running room to defend you,” said Samuel Buell, a former federal prosecutor who is now a law professor at Washington University in St. Louis.

Before the hearing, Tourre and Blankfein, 55, were interviewed under oath by the Senate Permanent Subcommittee on Investigations. Senator Carl Levin, the Michigan Democrat who heads the panel, said he’s looking into whether they “tried to fudge” their responses in the public hearing this week. Blankfein will appear next week at the annual shareholders meeting to answer questions related to the lawsuit.

Read more: http://preview.bloomberg.com/news/2010-04-30/goldman-sachs-loses-room-to-maneuver-after-public-testimony-by-officials.html

[Klukie]

10. You know I kept wondering why these guys kept answering questions so freely

I was waiting for them to say that their attorneys advised them not to answer due to the pending lawsuit but they never did it.

[hobbit709]

11. And when the story keeps changing, somebody's lying.

[metapunditedgy]

12. Classic behavior from someone who expects to settle matters politically, rather than legally.

Hopefully, they will be disappointed.

[Ghost Dog]

18. bingo.

:smoke:

[scentopine]

13. They feel they are invincible and above the law, arrogance, etc -nt

[edwinmathews]

14. Every

Senator that is part of these hearings should have to state how much money they have taken from Goldmen before they ask every question .

[Ikonoklast]

15. I was amazed at their people babbling gibberish, for the record

Who's their lead counsel, Orly Taitz?

[olegramps]

16. They appear to be not that well advised:

One of the most powerful weapons that an investigator has, for example, is to have a person swear that they had never known the person or that they had never been in the residence only to be proven to be lying when physical evidence proves otherwise. When this guys claim that they weren't misleading investors and it is proven that they knew before hand that the securities were worthless they are dead in the water.

[CountAllVotes]

17. these fraudsters belong in jail along with Madoff

and they must take HANK PAULSON with them as they float down the drain along with the rest of their stinky sh*t. *flush*

:kick: & recommend.

[izquierdista]

19. I'm not so sure

Who needs defense lawyers when you own the courts?