Whew! We can all breathe a sigh of relief now that the financial crisis is over. The Securities and Exchange Commission has found former Goldman Sachs banker Fabrice Tourre liable on six counts of securities fraud.
I’m being sarcastic of course.
Mr. Tourre dealt out toxic mortgage deals under a company known as Abacus (you remember them home loan borrowers), which Goldman Sachs created in 2007 at the request of hedge-fund manager John Paulson. Paulson wanted to use the fund to bet against it, which he did considerably, garnishing him $15 billion before the Home Loans Crisis officially hit the fan and the news.
Suspiciously not on trial in the case was Goldman Sachs itself, although the bank paid all of Tourre’s legal fees, which was the least it could do for its sacrificial lamb. Earlier in 2010 Sachs settled with the SEC by paying a $550 million penalty without ever having to admit any wrongdoing.
A jury found that Tourre had misled investors about the nature of the deal, tricking them into thinking it had not been built for failure from the start. He now faces the possibility of heavy financial penalties and a lifetime ban from the securities industry.
A hollow victory in the wake of all the terminal damage to our economy that was caused.
