Belfast Telegraph

Goldman Sachs braced for large fine

US banking giant Goldman Sachs was today braced for a hefty fine from the UK's City regulator the Financial Services Authority.

The fine, which could be announced today, is reported to be £20m (31m US dollars) - one of the heaviest penalties ever levied by the FSA.

The FSA began its investigation in April after the US Securities and Exchange Commission (SEC) charged Goldman with misleading buyers of complex mortgage-backed investments in 2007, when the US housing market bubble was bursting.

The bank settled the fraud charge in mid-July by agreeing to pay £356m (550m US dollars) - the largest fine in the SEC's history.

The FSA said that Goldman failed to disclose that Fabrice Tourre, the trader accused by the SEC of being at the centre of the mortgage-backed securities deal, was under investigation.

Tourre moved to the company's London office to become executive director of Goldman Sachs International in late 2008, bringing his business dealings under the jurisdiction of the UK regulator.

He denied any wrongdoing and asked a federal court to throw out the SEC case.

According to the Wall Street Journal, Goldman will admit that it made a mistake in failing to tell the FSA about Tourre.

Belfast Telegraph

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