Goldman to pay $60 mln in subprime settlement

Discussion in 'Wall St. News' started by ASusilovic, May 11, 2009.

  1. NEW YORK (MarketWatch) -- Massachusetts Attorney General Martha Coakley on Monday said her office has reached a $60 million settlement with Goldman Sachs Group Inc. related to the investment bank's role in securitizing subprime mortgage loans.

    At a press conference, Coakley said the settlement is part of an industry-wide investigation into predatory lending practices that is ongoing, although she declined to name any individual firms that might be under investigation.

    As part of the settlement, Goldman Sachs will pay $50 million to Massachusetts homeowners who will be able to modify their mortgages to help them stay in their homes, she said. Goldman Sachs didn't acknowledge any wrongdoing in the settlement, Coakley said.

    For homeowners with loans held by Goldman entities, Goldman has agreed to reduce the principal of first mortgages by up to 25-35% and second mortgages by 50% or more, Coakley said.

    The Attorney General said that Massachusetts has been hard hit by the subprime mortgage crisis, and that her office has been investigating several different implications of the problem, including why it occurred, how to prevent a repeat of the problem and how to ease the fallout for homeowners and municipalities.

    She said her probe investigated patterns of behavior among lenders as well as those firms that securitized the loans.

    "We didn't single out Goldman Sachs, Coakley said, adding that the firm worked in good faith with her office to find "very specific remedies," for homeowners including significant principal writedowns to allow sale of homes, or refinancings to allow people to remain in their homes.

    "The loan restructuring program is designed to enable borrowers to replace problem loans with new, more affordable loans that take into account the current value of their properties. Goldman has also agreed to make a $10 million payment to the Commonwealth, and will continue to cooperate with the Attorney General in her ongoing investigation of industry practices," Coakley's office said in a press release.

    She did not identify any other firms being eyed, but said that she is conducting a broad industry.{D6BD5788-41D5-49F2-A78E-0CD9711B0186}

    Welcome in the CIRCUS MAXIMUS ! A company that receives TARP money being fined for the very reason of this mess. To say it in Windows language : SYNTAX ERROR ! WTF ????????:confused: :confused: :confused: :mad: :mad: :mad:
  2. They have already made $60 million in the market today alone.