Goldman Sachs

The American International Group, Inc. (“AIG”) and certain individual directors and officers have agreed to pay $725 million to settle a securities class action. That's a couple of hundred million more than Goldman Sachs agreed to pay to settle its problems with the SEC.

The SEC has issued the following release: 

On a day when the Senate passed the Financial Reform bill and BP says it stopped the Gulf leak, the apparent Goldman Sachs settlement seems like relatively minor news. But it's not minor for Goldman shareholders (shares climbed $5 in the final half hour of trading), creditors, and employees. It is not clear how the SEC will pitch, or defend, this settlement, but if reports are accurate, Goldman should consider this a big win.

A headline on the New York Times Web site says "Goldman Sachs to Settle Securities Claim for $550 Million, a Person Close to the Deal Says."  This would be about half of the $1 billion that some have estimated would be the minimum amount of any settlement. More on this to follow....

There’s an interesting story by Jesse Westbrook and David Scheer on Bloomberg.com today that suggests that Goldman Sachs may be willing to pay up to $1 billion to settle the civil fraud claims brought against it by the Securities and Exchange Commission. 

We noted yesterday that N.Y. Attorney General Andrew Cuomo has apparently begun a criminal investigation into Wall Street practices relating to the subprime mortgage industry. That’s just one criminal investigation from one prosecutor. Not to mention the pending civil suits, such as the SEC’s action against Goldman Sachs, with more undoubtedly to follow. Who's got troubles? Wall Street's got troubles.

Goldman Sachs is going to settle charges with the federal government. No, not those relating to Abacus, but ones relating to alleged short-selling of stocks in 2008-2009. It’s going to pay $450,000. 

We’ll see about the other ones sometime. Maybe not

It’s a beautiful morning in the northeastern U.S. – well, maybe except if you’re waking up as a Goldman Sachs senior exec. Morning reports suggest that the Justice Department is investigating whether to bring criminal charges against the firm. 

The congressional hearing on Goldman Sachs is available online right now at http://www.msnbc.msn.com/id/21134540/vp/36798495#36798495.

Read more email from Goldman Sachs about the subprime meltdown, courtesy the Washington Post: http://media.washingtonpost.com/wp-srv/politics/documents/goldman_tourre_emails.pdf?hpid=topnews and http://www.washingtonpost.com/wp-srv/politics/documents/goldman_emails.pdf?hpid=topnews.