Goldman Sachs executives come under fire at hearing
US Senator Carl Levin:
"Goldman... often saw its clients as objects for its own profit"
The chairman of an inquiry into the causes of America's financial meltdown has attacked the role of Goldman Sachs.
Senator Carl Levin spoke of the reckless greed that infected Wall Street's financial community.
In his opening address to the hearing in Washington, Mr Levin said Goldman executives had caused widespread harm to their fellow citizens.
Several Goldman executives are giving evidence at the hearing, and all have denied they acted improperly.
The "masters of the universe" would be wise to curb their arrogance and not vent their frustration by making wisecracks. Mark Mardell, BBC North America editor Read Mark's blog in full Mr Levin, chairman of the Senate Permanent Subcommittee on Investigations, said that Goldman had proclaimed a responsibility to its clients, "yet the evidence shows that Goldman repeatedly put its own interests and profits ahead of the interests of its clients and our communities".
The firm packaged complex mortgage-backed securities and then sold them to investors knowing that the housing market was about to collapse, it is alleged.
The Securities and Exchange Commission (SEC) alleges that in the case of one of these products Goldman and its executive, Fabrice Tourre, defrauded investors by failing to tell them of a conflict of interest.
Goldman says the allegations are wrong in "fact and law".
Mr Levin said it was not his committee's role to judge the legality of the SEC's claims, adding that the hearing was concerned with "ethics and policy".
But he said that Goldman's actions reverberated around America. The firm's "misuse of exotic and complex financial structures helped spread toxic mortgages throughout the financial system," he said.
"And when the system finally collapsed under the weight of those toxic mortgages, Goldman profited from the collapse," he added.
Goldman executives at the hearing include Fabrice Tourre, Daniel Sparks, Joshua Birnbaum, and Michael Swenson.
Lloyd Blankfein, the firm's chief executive, is due to appear later in the day.
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US Senator Carl Levin:
"Goldman... often saw its clients as objects for its own profit"
The chairman of an inquiry into the causes of America's financial meltdown has attacked the role of Goldman Sachs.
Senator Carl Levin spoke of the reckless greed that infected Wall Street's financial community.
In his opening address to the hearing in Washington, Mr Levin said Goldman executives had caused widespread harm to their fellow citizens.
Several Goldman executives are giving evidence at the hearing, and all have denied they acted improperly.
The "masters of the universe" would be wise to curb their arrogance and not vent their frustration by making wisecracks. Mark Mardell, BBC North America editor Read Mark's blog in full Mr Levin, chairman of the Senate Permanent Subcommittee on Investigations, said that Goldman had proclaimed a responsibility to its clients, "yet the evidence shows that Goldman repeatedly put its own interests and profits ahead of the interests of its clients and our communities".
The firm packaged complex mortgage-backed securities and then sold them to investors knowing that the housing market was about to collapse, it is alleged.
The Securities and Exchange Commission (SEC) alleges that in the case of one of these products Goldman and its executive, Fabrice Tourre, defrauded investors by failing to tell them of a conflict of interest.
Goldman says the allegations are wrong in "fact and law".
Mr Levin said it was not his committee's role to judge the legality of the SEC's claims, adding that the hearing was concerned with "ethics and policy".
But he said that Goldman's actions reverberated around America. The firm's "misuse of exotic and complex financial structures helped spread toxic mortgages throughout the financial system," he said.
"And when the system finally collapsed under the weight of those toxic mortgages, Goldman profited from the collapse," he added.
Goldman executives at the hearing include Fabrice Tourre, Daniel Sparks, Joshua Birnbaum, and Michael Swenson.
Lloyd Blankfein, the firm's chief executive, is due to appear later in the day.
Read entire article
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