Goldman Execs Probably Won't Face Charges in Connection to Their Role in the Mortgage Crisis
Report: Goldman Subpoenaed Over Mortgage Meltdown
June 2, 2011The Lookout - Back in April, Michigan Democratic Sen. Carl Levin, who chairs the Senate Permanent Subcommittee on Investigations, said he wanted prosecutors to look into whether Goldman Sachs executives broke the law in connection to the firm's sub-prime loan business. Now there's evidence such a probe could be under way.
Goldman has received a subpoena from the Manhattan District Attorney's office, Bloomberg reports.
According to Bloomberg's sources, the subpoena relates directly to a report released in April by Levin's subcommittee. As we wrote at the time, that report concluded Goldman misled investors in order to profit from the mortgage meltdown, then misled Congress about its role in the crisis.
In releasing the report, Levin said he wanted a criminal investigation into two key issues:
- whether top Goldman execs committed perjury during testimony before his panel last year; and
- whether they illegally deceived investors by selling them complex loans, without mentioning that Goldman was simultaneously betting against those loans.
Despite the subpoena, it's not known for sure whether Goldman is the target of any criminal investigation, and some experts have said they don't expect that the company or its executives will face charges.
A Goldman spokesman said the firm would cooperate with the subpoena. A spokeswoman for Manhattan D.A. Cyrus Vance Jr. declined to comment to Bloomberg.
Primary Dealers of the Federal Reserve System:
BNP Paribas Securities Corp.
Banc of America Securities LLC
Barclays Capital Inc.
Cantor Fitzgerald & Co.
Citigroup Global Markets Inc.
Credit Suisse Securities (USA) LLC
Daiwa Securities America Inc.
Deutsche Bank Securities Inc.
Goldman, Sachs & Co.
HSBC Securities (USA) Inc.
Jefferies & Company, Inc.
J. P. Morgan Securities Inc.
Mizuho Securities USA Inc.
Morgan Stanley & Co. Incorporated
Nomura Securities International, Inc.
RBC Capital Markets Corporation
RBS Securities Inc.
UBS Securities LLC.
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