I have it in my hands, here is where it states it. So how is this fraud? If you bought this, you are an idiot it states that they will trade against you. Goldman Sachs does not make any representation, recommendation or warranty, express or implied, regarding the accuracy, adequacy, reasonableness or completeness of the information contained herein or in any further information, notice or other document which may at any time be supplied in connection with the Transaction and accepts no responsibility or liability therefore. Goldman Sachs is currently and may be from time to time in the future an active participant on both sides of the market and have long or short positions in, or buy and sell, securities, commodities, futures, options or other derivatives identical or related to those mentioned herein. Goldman Sachs may have potential conflicts of interest due to present or future relationships between Goldman Sachs and any Collateral, the issuer thereof, any Reference Entity or any obligation of any Reference Entity.
What that states does not matter...what matters is what a jury thinks and believes. The Jury will consist of the following: bunch of pissed off guys layed off from different jobs around New York, retired guy who saw his entire investment in AIG plunge and now works a job washing cars at the wash, 45 year old mother of 23 year old who cant find a job, 53 year old guy who was just foreclosed upon... The litigation against Goldman will be endless and at the end of the line will be a jaded pissed off jury awarding the largest rewards in history. I would not be surprised if Goldman is bankrupt in a few years after litigation seemingly cripples it OR the common stock trades back to its March 2009 lows or lower. If I was on a jury, I wouldnt care what your prospectus states. I wouldnt care what the Goldman witnesses have to say. All I know is that Goldman was somehow a part of this massacre and someone has to pay. I would hand out the largest reward I can write on a piece of paper. 10 Gazillion dollars against Goldman. Thats how it is in America. Someone has to pay and in this case it will be Goldman. If I was the "Fabulous Fab", I would get on an airplane with the spoils and head out to some country where American law will not be able to reach. I wouldnt simply live it out in NYC thinking everything will be peachy from here on.
I wanted to add...Its going to be a field day for Plaintiffs attorneys as one lawsuit is filed after another against Goldman...in fact, I am ready to head down to the courthouse myself and file one pro-se requesting a jury trial. The Plaintiff attorneys are experts at depositions. The "Fabulous Fab" will be deposed left and right. All the information found will be public record and with each day that passes Goldman's reputation will be dragged through the mud. Every day more and more shit will be tossed up against the wall and in the newspapers. People will get on the internet and see whats new in the various Goldman Sachs cases. ...and, as I said up top, there will be a pissed off jury at the end of Goldman's rope that wants blood...
I'm lost here. Why civil charges and not criminal. You'd think the SEC would forward to the AG. Civil charges would be easier to prove? Before this is all over, politics will be the culprit.
I don't think the issue is of GS being on one side or the other. The issue as I understand it is claiming the contents of the synthetic CDO were put together by an independent 3rd party when they were actually put together by someone who cherry picked the contents to be most likely to fail.
Because no crime was commited. The Prospectus stated it in black and white that they will short your long position. I looked at the Prospectus, The garbage that built it was all there. Whoever went long did not bother to read it.
The burden of proof in a civil case is "preponderance of evidence" and in a criminal proceeding it is "beyond a reasonable doubt". So the evidence just needs to be 51% in the government's favor in a civil proceeding. Fraud is very hard to prove in a criminal proceeding requiring 9 different elements where very probably evidence must exist. Those 9 elements are: representation of an existing fact; its materiality; its falsity; the speaker's knowledge of its falsity; the speaker's intent that it shall be acted upon by the plaintiff; plaintiff's ignorance of its falsity; plaintiff's reliance on the truth of the representation; plaintiff's right to rely upon it; and consequent damages suffered by plaintiff.
I think the civil charges are to open the door. The battering ram is what follows. http://www.zerohedge.com/article/ra...cut-ag-blumental-wants-criminal-charges-filed "The notable take home for us was that CT AG Blumenthal said that "criminal charges have to be pursued against Goldman." We are sure Cuomo is not too far from this line of thinking." Lloyd and Hank screwed the pooch on this one. Goldman's name is dirt not only because of this, but for the Greece deal as well, so "clients" know how they are going to be dealt with. And those are only two that surfaced - who knows how many more? It will be interesting to read all of "Fab" Fabrice's e-mails. At 27 when the deal was done, there is no way he acted on his own. Will Lloyd and the execs be another party group to claim "I know I make millions in salary and bonus, but I don't know squat!"?
Isn't the fraud related to misrepresentation? It's not about whether GS was long or short the CDO. They told investors that Paulson was long AND still long the CDO when in fact he was short and remained short. Moreover, Goldman claimed to be long the CDO and lost $90m on that trade. (BTW, they make more than that on a good day, so the loss doesn't count for much in my book) EKO
Take the time to thoroughly read pages 11-17: http://online.wsj.com/public/resources/documents/secgoldman2010-04-16.pdf You will then perhaps better understand the angle the SEC is taking. This is about intentional disclosure misrepresentation, not about GS shorting a toxic CDO they had helped underwrite. It is alleged that Goldman told the Abacus CDO investors (IKB - German bank) that the RMBS tranches were chosen by an objective and independent 3rd party (ACA) at the request of IKB, when in fact they were customized by Paulson in order for him to optimize his CDS (short view) positioning. ACA signed off on Paulson's selections after several back-and-forth amendments. Goldman also led ACA to believe Paulson was to be "long" the equity slice of the Abacus CDO, which was not the case. Time will tell which allegations/claims will stick.