Fabrice Tourre, the former Goldman Sachs Group Inc. vice president on trial for his role in a failed $1 billion investment, was found liable on six of seven claims by a jury in Manhattan.
The verdict is a victory for the government in one of the most high-profile trials to come out of the financial crisis of 2007-2008. The
The jury’s finding of wrongdoing may help Goldman Sachs customers in lawsuits against the bank over losses tied to the transaction. Tourre faces unspecified money penalties and a possible ban from the securities industry.
The SEC claimed Tourre hid the fact that Paulson helped choose the portfolio of subprime mortgage-backed securities underlying Abacus, then made a billion-dollar bet it would fail.
At trial, the SEC presented testimony from 11 witnesses over two weeks. Tourre didn’t call any witnesses, relying instead on his lawyers’ questioning of the witnesses called by the SEC, including Tourre himself.
“We are obviously gratified by the jury’s verdict and appreciate their hard work,” Matthew Martens, the lead SEC lawyer, said.
“As a firm, we remain focused on being more transparent, more accountable, and more responsive to the needs of our clients,” Michael DuVally, a Goldman Sachs spokesman, said in a statement.
“We’re declining comment as the case is still ongoing,” Chris Kittredge, a spokesman for Tourre at Sard Verbinnen & Co. in New York, said in a statement.
