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Goldman Sachs to pay $22M to settle charges (GS)

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Goldman SachsInvestment bank Goldman Sachs (NYSE: GS) has agreed to pay $22 Million to settle regulatory charges framed against the firm. The bank was accused that some of its analysts shared confidential research work with its top clients.

The regulators alleged that some analysts used to ‘huddle’ weekly between 2006 and 2011 to discuss confidential research work on stocks with certain firm’s traders.  The analysts are also believed to have passed on the ideas to some of bank’s top clients.


The settlement was announced on Thursday by both the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA). According to the settlement, $ 11 million will be paid to the Securities and the Exchange Commission and another $11 Million will be paid to the Financial Industry Regulatory Authority.

Besides, the SEC has also ‘censured’ the bank. Any firm or individual censored before can face sterner action, if the same alleged violation is repeated.

However, Goldman Sachs has neither admitted nor denied the allegations.

Commenting over the matter, Michael DuVally, spokesman for Goldman Sachs in New York said “We are pleased to have resolved this matter”.

Earlier, in July 2010, the Wall Street’s giant had to settle a record $550 million against civil fraud charges.  The bank was alleged to misled buyers of mortgage-related (sub-prime) investments. The SEC said Goldman sold mortgage investments without revealing it to buyers that the securities had been crafted with input from client Paulson & Co., which was betting on them to fail.

The alleged fraud cost investors about $ 1 billion in losses even as Paulson’s firm capitalized from the housing market bust. The SEC also said that bank itself made hundreds of millions from the deal as it was betting heavily against the housing market.  In June 2011, the bank agreed to pay $10 million in a settlement against similar charges with Massachusetts regulators.

 

 

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edliston
Post Written By: Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.


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Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing.

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