How did Goldman Sachs settle its allegations related to the Abacus deal?

Question

Accepted Answer

Goldman Sachs Settled Abacus Deal Allegations for US$550 Million

Goldman Sachs settled Securities and Exchange Commission (SEC) allegations concerning the Abacus deal in July 2010 for US$550 million. This settlement amount represented a record sum at the time.
Abacus Deal Background

The Abacus deal, known as a synthetic collateralized debt obligation, involved a portfolio of 90 subprime residential mortgage-backed securities. The SEC claimed that Fabrice Tourre, a former Goldman Sachs vice president, misled investors about the role of Paulson & Co., a hedge fund led by John Paulson. Specifically, the SEC alleged that Tourre failed to disclose that Paulson helped select the portfolio of securities while simultaneously betting on its failure.
Goldman Sachs' Settlement and Tourre's Defense

While Goldman Sachs settled its allegations in July 2010, the SEC proceeded with its case against Fabrice Tourre. Tourre, facing civil fraud claims, rested his defense without presenting any witnesses. The SEC had previously presented testimony from 11 witnesses over two weeks, including former Goldman Sachs employees and an executive from ACA Management LLC, which helped select the Abacus portfolio.
Record Settlement Amount

The US$550 million settlement paid by Goldman Sachs in July 2010 was a significant figure and established a record at the time for such settlements. This resolution addressed the SEC's allegations against the firm, although legal proceedings continued for Tourre individually. The case against Tourre focused on his alleged role in misleading participants about the Abacus deal's structure and Paulson's involvement.

Reading history

Hide →

This history is cleared when the page is closed.

How did Goldman Sachs settle its allegations related to the Abacus deal?

Loading

Was this article helpful?

Helpful

Not helpful

Report an issue

1

0

0

Share with friends