Goldman Pulls Tourre’s License As Ex-Employee’s E-Mail Surfaces

Apr 22 2010 | 11:12am ET

Fabrice Tourre, the Goldman Sachs executive charged with defrauding investors in the Paulson & Co. collateralized debt obligation case, has lost his license to work in London.

Goldman has applied to de-register its embattled vice president with the Financial Services Authority. Tourre, who was placed on paid leave after the U.S. Securities and Exchange Commission charged him and his employer with misleading investors, has been registered with the FSA since 2008.

Meanwhile, a former Goldman salesperson who spoke with the SEC has been identified as Gail Kreitman, Reuters reports. According to the SEC’s complaint, Kreitman, who left Goldman last year, failed to correct an executive at ACA Management, which selected the securities in the CDO in question and was a major investor in it, who suggested that Paulson was long the CDO.

The SEC contends that Goldman misled ACA and other investors about Paulson’s intention, which was to short the CDO, ABACUS-2007-AC1. The firm and Tourre are also accused of misleading investors about Paulson’s role in selecting the residential mortgage-backed securities that went into the CDO. But former Paulson & Co. portfolio manager Paolo Pellegrini testified that his old firm told ACA that it was bearish on the CDO, and that ACA rejected most of the securities Paulson suggested be included.

In Goldman’s bid last year to keep the SEC from filing charges, it claimed that Kreitman may not have “understood the significance of [ACA executive Laura] Schwartz’s statements suggesting she believed Paulson to be an equity investor."

“The fact that Ms. Kreitman did not correct Ms. Schwartz’s statements that Paulson was an equity investor does not indicate that she attempted to conceal the truth from ACA,” Goldman’s lawyers wrote to the regulator.

Kreitman has not been charged with any wrongdoing in the case.


In Depth

Royalties: The Alternative Assets of the Music Industry

Jul 8 2016 | 7:01pm ET

Recent market volatility has investors seeking greater insight into alternative...

Lifestyle

Vortic: Making Great American Watches Again

Jul 25 2016 | 6:29pm ET

If you are compelled by stories of entrepreneurial vision & drive, or simply...

Guest Contributor

MPI: Like Stellar Returns? Better Understand the Risks First

Jul 22 2016 | 8:44pm ET

When the press reports extraordinarily strong relative or risk-adjusted returns...