The USA Securities and Exchange Commission (SEC) has charged Goldman Sachs Group Inc with fraud today, for the structuring and marketing of sub-prime debt products.
The SEC makes allegations that Goldman Sachs withheld information about the nature of a CDO, called ABACUS. 99% of this CDO, within just 9 months of being structured by Sachs, was downgraded, costing invesors over $1 billion.
Fabrice Tourre, the Goldman Sachs vice president responsible for ABACUS has been charged with fraud by the SEC.
The bank lost over 10% of its share value in this morning’s trading on Wall Street, dropping nearly $20 per share to $164.88.