Goldman CDO Exec. Says SEC Lawsuit Not Allowed

Oct 1 2010 | 3:32am ET

Fabrice Tourre, the only individual charged in the Goldman Sachs collateralized debt obligation fraud case, has argued that he can’t be sued in the U.S.

Tourre’s lawyers argue that the CDO deal, called ABACUS-2007-AC1, is not subject to U.S. securities laws because it was not a U.S. securities transaction and the buyer, the German bank IKB Deutsche Industriebank, is not a U.S. investor. Tourre himself, the vice president who oversaw the Abacus CDO, allegedly structured and marketed on behalf of hedge fund Paulson & Co., is based in London.

“The complaint’s failure to allege that any ABACUS-2007-AC1 transaction took place in the United States requires dismissal,” Tourre’s lawyers argued.

Tourre’s claim that the SEC suit is barred by a June U.S. Supreme Court decision mirrors that made by his employers in a separate CDO case. Goldman has sought the dismissal of a lawsuit filed by collapsed hedge fund Basis Capital Management, arguing that the transaction took place either in the U.K. or Australia, where Basis was based.

Goldman did not put forth that argument in the Abacus case, instead settling the charges for $550 million.


In Depth

JOBS Act Propels Real-Estate Crowdfunding Platform

Oct 21 2014 | 2:57am ET

If D.J. Paul were a real estate development, he would be described as “multi-use...

Lifestyle

Strippers Accused Of Robbing Hedge-Fund Manager Face Jail

Oct 20 2014 | 9:20am ET

A group of alleged stripper-thieves—whose victims include a hedge-fund manager...

Guest Contributor

PAAMCO: European Equity Exposure - Challenging Year, But All is Not Lost

Oct 16 2014 | 4:12am ET

European equity hedge fund managers have had a tough time so far this year. The...

 

Videos

Editor's Note

    Must Attend Hedge Fund Charity Events For October

    Sep 30 2014 | 9:29am ET

    The crisp Autumnal days of October are upon us, and so are a few of the hedge fund industry’s favorite charitable events. If you have never been to Rocktoberfest, well, you are missing out. And for a quieter evening of sipping and socializing, stop by HFC’s Wine Soiree. Read more…

 

Futures Magazine

October 2014 Cover

Deeply flawed risk benchmark

Most traders agree that proper risk management is the key to successful trading. However, many traders depend on the deeply flawed measure of standard deviation as a benchmark of risk. Here we put it ...

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.