Friday, 28 November 2014
Last updated 1 day ago
Jan 7 2011 | 8:53am ET
The largest investor in a controversial Goldman Sachs collateralized debt obligation has sued the firm, which the Securities and Exchange Commission accused last year of misleading it about the role of hedge fund Paulson & Co. in the CDO.
ACA Financial Guaranty said it was "misled by Goldman's fraudulent activities" and alleged that the CDO, called ABACUS-2007-AC1 was already "worthless" when Goldman marketed it to ACA. ACA bought millions of dollars worth of Abacus notes and insured part of the portfolio for $909 million.
In its own lawsuit against Goldman filed in late 2009—settled in May for $550 million—the SEC accused the Wall Street giant of hiding Paulson's role from ACA. The agency alleges that the CDO was structured and marketed on behalf of Paulson, which shorted it, earning about $1 billion in profits.
An ACA unit, ACA Management, was employed by Goldman to select the residential mortgage-backed securities to go into the CDO. Paulson, which has not been accused of wrongdoing in the case, allegedly suggested 123 RMBS, of which ACA rejected 68.
ACA is seeking $120 million in damages in its suit, filed yesterday in New York state court.
Nov 4 2014 | 9:45am ET
Data management is important to every business, but for hedge funds, it is critical. FINalternatives recently asked Peter Sanchez, CEO of Northern Trust Hedge Fund Services, how fund managers can deal with the demands of managing data while at the same time remain transparent and abide by operational best practices. Read more…
Reg NMS created a huge bifurcation in equity markets and while much of what has followed has been positive, in terms of lower fees and greater liquidity, many traders would like to see the market come...