Condemnation

Probe: Goldman Misled Investors

Referred for criminal and civil action.

A two-year Senate probe into the U.S. financial crisis is wrapping up, and its diagnosis of Goldman Sachs is far from flattering. “Our investigation found a financial snake pit rife with greed, conflicts of interest and wrongdoing,” said Sen. Carl Levin (D-MI), while Sen Tom Coburn (R-OK), who also approved the findings, said, "It shows without a doubt the lack of ethics in some of our financial institutions," The probe found that Goldman Sachs designed, marketed, and sold collateralized debt obligations that misled investors and created conflicts of interests just before the U.S. housing market collapsed, in one case telling investors in a CDO that their interests were aligned when in fact the firm held 100 percent on the short side. “In my judgment, Goldman clearly misled their clients and they misled the Congress,” said Levin, referring to the investment bank's testimony before a subcommittee at an April 2010 hearing. Levin went on to say he would refer their testimony to the Justice Department for possible perjury charges, as well as to the Securities and Exchange Commission. Asked if he was disappointed no Wall Street figures had gone to jail in connection with the crisis, Levin replied, “There's still time.”