Lloyd Blankfein admits Goldman Sachs failed to raise the alarm

[CHIMO]

The head of Goldman Sachs, Lloyd Blankfein, will admit to Congress tomorrow that his bank failed to raise the alarm about excesses in the mortgage industry and got involved in "overly complex" derivatives deals that fuelled perceptions of Wall Street running out of control.

In written testimony prepared for the senate's permanent subcommittee on investigations, Blankfein will tell lawmakers that the Securities and Exchange Commission's $1bn (£647m) fraud case against his firm marked a low point in his career.

"It was one of the worst days of my professional life, as I know it was for every person at our firm," says Blankfein's testimony, released by Goldman this evening.

While insisting that the bank has committed no crime, Blankfein concedes that the Abacus mortgage-backed securities transaction at the heart of the SEC's case left a bad impression.

http://www.guardian.co.uk/business/2010/apr/26/goldman-sachs-sec-senate-hearing

[Vinnie From Indy]

1. "It was one of the worst days of my professional life, as I know it was for every person at our firm

Blankfein then offered that "Yeah, we were really bummed about the fraud case but then the mailroom guy dropped off our bonus checks and we began to feel much better!