Saturday, 20 September 2014
Last updated 20 hours ago
Jul 29 2010 | 12:20pm ET
Goldman Sachs undoubtedly believes that there have been too many lawsuits filed against it over its controversial Abacus collateralized debt obligation. A New York State judge agrees—to an extent.
Faced with two more investor lawsuits against the Wall Street giant and some of its top officials, Justice Richard Lowe combined the two into one, and then adjourned the case until more progress is made on the 15 shareholder lawsuits filed against Goldman in Manhattan federal court.
At issue is Goldman’s role in the ABACUS-AC1-2007 transaction. The firm recently settled a Securities and Exchange Commission fraud lawsuit, alleging that Goldman misled investors about the role of hedge fund Paulson & Co. in the CDO. According to the SEC, Goldman structured and marketed the CDO on Paulson’s behalf, but did not tell investors that Paulson helped select the securities that went into the CDO or that the hedge fund planned to short the CDO through credit default swaps it bought from Goldman.
The bank agreed to pay $550 million to make the SEC case go away, without admitting wrongdoing but acknowledging problems with its marketing materials.
Lowe agreed to delay the lawsuits in his own court at the request of plaintiff’s lawyer Jennifer Sarnelli. Goldman has argued that all of the lawsuits—including an 18th, in Delaware Chancery Court—should be combined and moved to a single venue.
Sarnelli disagreed, telling Lowe, “we believe that this is the right jurisdiction,” when asked why she chose not to join the federal cases.
Aug 25 2014 | 11:21am ET
As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…
Credit default swaps brought down the London Whale and cost JPMorgan $6.2 billion. Here is how it happened.