SEC Fraud

The SEC charged Goldman Sachs & Co and one of its VPs for defrauding investors. Allegedly, Goldman structured and sold a CDO (collateralized debt obligation) that was heavily influenced by a major hedge fund.

“Goldman wrongly permitted a client that was betting against the mortgage market to heavily influence which mortgage securities to include in an investment portfolio, while telling other investors that the securities were selected by an independent, objective third party,” said Robert Khuzami, director of the division of enforcement.