Sunday, 28 August 2016
Last updated 1 day ago
Mar 12 2014 | 11:40am ET
A former Goldman Sachs executive must pay more than $850,000 for defrauding investors in a Paulson & Co.-linked collateralized debt obligation, a federal judge has ruled.
Fabrice Tourre was found liable in August for misleading investors in and the insurer of ABACUS-2007-AC1 about Paulson's role in selecting the securities that went into the deal, and about the hedge fund's plan to short it. U.S. District Judge Katherine Forrest ordered him to repay the part of his bonus that the Securities and Exchange Commission said was related to the CDO, $175,463, as well as a $650,000 fine.
"Tourre's conduct spanned several months, and involved many e-mails, meetings and calls," Forrest wrote. "He has shown no remorse or contrition." Indeed, Tourre, now a graduate student, has continued to deny wrongdoing, and is likely to appeal the fine and jury verdict against him.
Forrest also barred Tourre from seeking Goldman's help to pay his fine, which is somewhat less than the more than $1.1 million sought by the SEC, but much more than the $65,000 sought by his attorneys.
Goldman paid $550 million to settle its role in the case. Paulson was never accused of any wrongdoing.