Mortgage News
FSA confirms unprecedented probe into Goldman Sachs
The FSA has today confirmed it will launch an unprecedented investigation into the international arm of US bank Goldman Sachs.
Reports at the weekend linked the UK regulator to a probe into Goldman’s banking practices currently underway at the Securities and Exchange Commission (SEC) across the Atlantic.
In a short statement today, the FSA confirmed it is also beginning its own enquiry into the bank’s involvement in alleged fraud relating to the £650m of the toxic sub-prime deals which have been blamed for the global economic meltdown.
A spokesman hinted at the enormity of the impending task, saying, “there is no like for like in this situation”.
In its statement, the regulator says: “Following preliminary investigations the FSA has decided to commence a formal enforcement investigation into Goldman Sachs International in relation to recent SEC allegations. The FSA will be liaising closely with the SEC in this review.”
The spokesman adds the decision is in line with the FSA’s responsibilities to the UK financial sector.
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“Anything which has implications for UK operations we need to look into.”
Both the US and UK investigations reportedly centre on Fabrice Tourre, a Goldman Sachs banker who in 2008 was allowed to move from the U.S. operation to Sachs’ London business despite being under investigation by American regulator the SEC, and without the bank notifying their British counterparts.