Tags: Goldman Sachs | lawsuit | class action | CDO

Goldman Sachs Investors Can Proceed as Group in CDO Lawsuit

Thursday, 24 Sep 2015 04:59 PM

Goldman Sachs Group Inc. investors who claim they were harmed by conflicts of interest related to collateralized debt obligation transactions won permission to pursue their lawsuit as a group.

A Manhattan federal judge on Thursday granted class-action status to the shareholders, saying they met legal requirements, with numerous members and claims typical of the group.

The U.S. Securities and Exchange Commission sued Goldman Sachs in April 2010, alleging fraud tied to CDOs that contributed to the worst financial crisis since the Great Depression.

The investment bank created and sold CDOs linked to subprime mortgages in early 2007, as the U.S. housing market faltered, without disclosing that hedge fund Paulson & Co. helped pick the underlying securities and bet against one of the vehicles, known as Abacus, the SEC claimed.

Goldman Sachs’s shares dropped about 13 percent after the lawsuit was filed. The firm paid $550 million to settle with the SEC.

Michael DuVally, a spokesman for New York-based Goldman Sachs, had no immediate comment on Thursday’s ruling.

The class certified by U.S. District Judge Paul A. Crotty includes investors who bought stock from Feb. 5, 2007 to June 10, 2010, and were harmed.

© Copyright 2017 Bloomberg News. All rights reserved.

 
1Like our page
2Share
InvestingAnalysis
Goldman Sachs Group Inc. investors who claim they were harmed by conflicts of interest related to collateralized debt obligation transactions won permission to pursue their lawsuit as a group.
Goldman Sachs, lawsuit, class action, CDO
193
2015-59-24
Thursday, 24 Sep 2015 04:59 PM
Newsmax Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved