Tourre Found Liable in SEC Case Claiming $1 Billion Fraud - Bloomberg
Fabulous Fab #fail.
Fabrice Tourre, the former Goldman Sachs Group Inc. (GS) vice president on trial for his role in a failed $1 billion investment, was found liable on six of seven claims by a jury in Manhattan.
The verdict is a victory for the government in one of the most high-profile trials to come out of the financial crisis of 2007-2008. The U.S. Securities and Exchange Commission accused Tourre, 34, of intentionally misleading participants in a 2007 deal known as Abacus about the role played by Paulson & Co., the hedge fund of billionaire John Paulson.
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Former Goldman Sachs Group Inc. Vice President Fabrice Tourre exits federal court with his attorney John “Sean” Coffey, right, in New York on July 31, 2013. Photographer: Peter Foley/Bloomberg
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Aug. 1 (Bloomberg) — Fabrice Tourre, the former Goldman Sachs Group Inc. vice president on trial for his role in a failed $1 billion investment tied to the housing collapse, was found liable on six of seven claims by a jury in Manhattan. The Securities and Exchange Commission accused Tourre of intentionally misleading participants in a 2007 deal known as Abacus about the role played by Paulson & Co., the hedge fund of billionaire John Paulson. Su Keenan and Trish Regan report on Bloomberg Television’s “StreetSmart.” (Source: Bloomberg)
The jury’s finding of wrongdoing may help Goldman Sachs customers in lawsuits against the bank over losses tied to the transaction. Tourre faces unspecified money penalties and a possible ban from the securities industry.
“The SEC got a big win today” in this “high-stakes market crisis case” against Tourre, said Tom Gorman, a former lawyer with the SEC’s Enforcement Division who is now in private practice.
The SEC claimed Tourre hid the fact that Paulson helped choose the portfolio of subprime mortgage-backed securities underlying Abacus, then made a billion-dollar bet it would fail.
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