Judge Junks Goldman Effort To Junk Bayou Award

Nov 8 2010 | 1:14pm ET

Goldman Sachs has lost its bid to vacate the largest arbitration award ever levied against a securities firm, one stemming from the Bayou Group hedge fund fraud case.

U.S. District Judge Jed Rakoff today denied Goldman's petition to vacate the $20.6 million award to the unsecured creditors of Bayou, which collapsed four years ago, costing investors more than $400 million. A Financial Industry Regulation Authority made the award earlier this year after the creditors claimed that Goldman, which cleared Bayou's trades, showed "either gross negligence or a willful choice to ignore signs of fraud."

Goldman denied those allegations. The firm could still appeal the arbitration award.

Ross Intelisano, a lawyer for the Bayou creditors, said of Rakoff's decision, "we are looking forward to investors finally getting some of their money back from this tragic fraud."

In Depth

Related-Company Fees: Normal Industry Practice or Conflicted Compensation?

Nov 11 2015 | 4:23pm ET

Regulatory agencies as well as investors are increasingly exploring whether certain...


Ferrari Roars in Wall Street Debut

Oct 21 2015 | 4:28pm ET

Shares of supercar maker Ferrari jumped as much as 15 percent to a high of nearly...

Guest Contributor

Private Debt - What is the Opportunity?

Nov 11 2015 | 3:28pm ET

In this contributed article, Rob Allard, founding partner of Firebreak Capital...


Editor's Note

    Oct 21 2015 | 10:41am ET

    One of the most unique charity benefits in the hedge fund industry, A Leg To Stand On's (ALTSO's) Hedge Fund Rocktoberfest - NYC, raised nearly $500,000 last Thursday thanks to the generous support of major sponsors and nearly 1,400 attendees from the Tri-State finance, business and hedge fund communities. Read more…