Goldman Chief Defends Decision To Do Business With SAC

Sep 19 2013 | 12:34am ET

Goldman Sachs CEO Lloyd Blankfein said the federal government is encouraging banks like his to continue to do business with the indicted SAC Capital Advisors.

"They've been indicted," Blankfein told CNBC yesterday. "They haven't been convicted. We are a big liquidity provider, we're a major prime broker. That would be quite an existential decision for them if all the liquidity providers withdrew liquidity on the basis of an indictment which they're contesting."

"The government wouldn't want us to withdraw that, because if everybody withdrew liquidity, you would vaporize a firm," he continued. "The government did come back and encourage firms like ours to continue to deal with SAC."

SAC is currently operating under a protective order while it fights insider-trading charges. Prosecutors have made clear that they do not want to put the hedge fund out of business prior to winning a conviction against it.

Blankfein's comments follow those of his second-in-command, Goldman President Gary Cohn, who said after the charges were filed that SAC is "an important client to us" and "a great counterparty."


In Depth

Star Fund Managers Battered By Rocky Ride In Yields, Currencies

May 28 2015 | 6:05am ET

Some of the biggest names in the investment world have been whipsawed by the recent...

Lifestyle

Yale Receives $150 Million Gift from Blackstone’s Schwarzman

May 12 2015 | 12:10am ET

Yale University announced it has received a $150 million gift from Blackstone Group...

Guest Contributor

The Road To Tax Alpha

May 28 2015 | 5:36am ET

Tax-related alerts are increasingly helping investment managers harvest tax alpha...

 

Sponsored Content

Editor's Note