Big fine imposed on ex-Goldman trader Tourre in SEC case
Source: Reuters
(Reuters) - A U.S. judge on Wednesday ordered former Goldman Sachs Group Inc trader Fabrice Tourre to pay more than $825,000 after a jury found him liable for defrauding investors in a subprime mortgage product that failed during the financial crisis.
The decision by U.S. District Judge Katherine Forrest in Manhattan came in one of the prominent Wall Street cases linked to the crisis, and one of the few in which an individual was held personally responsible for wrongdoing.
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"He has shown no remorse or contrition," Forrest added, referring to Tourre. The judge also forbade Goldman from paying Tourre's fine.
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Tourre became a symbol of the financial meltdown after the SEC sued him and Goldman in 2010 for misleading investors in a synthetic collateralized debt obligation, or CDO, linked to mortgages called Abacus 2007-AC1.
The SEC accused Tourre of concealing from investors how Paulson & Co, the hedge fund of billionaire John Paulson, had helped put Abacus together and had bet it would fail.
It also accused Tourre of misleading ACA Capital Holdings Inc, which helped choose Abacus assets, into thinking Paulson would be an equity investor in the CDO, rather than bet the other way as part of a massive wager against subprime mortgages.
Paulson, meanwhile made about $1 billion by shorting Abacus, while investors lost the same amount, the SEC said.
"The fraud on ACA was critical to making the transaction work; without ACA as portfolio selection agent, Goldman would not have been able to convince others to invest in the equity of the transaction," Forrest wrote.
Read more: http://www.reuters.com/article/2014/03/12/us-goldmansachs-sec-tourre-idUSBREA2B11220140312
The players here are really important. Look at what happened. Tourre becomes a shill for billionaire Paulson who basically robbed everyone of their money. The article states that Tourre is now working on his phD in Economics at U Of Chicago. Yes, the neo-conservatives economic mecca. I wonder if Paulson is helping him with that?
olddad56
(5,732 posts)okaawhatever
(9,462 posts)jail time. I do hope the federal case puts him behind bars for a long time.
mbperrin
(7,672 posts)I'd prefer a complete strip of all assets of all of the bastards, flaying alive, and public displays of their carcasses with explanation attached.
I'll take what I can get, I suppose. sigh
bulloney
(4,113 posts)$800 g's would be like paying for a parking violation for most of us. Hardly a deterrent. He's still millions ahead in the big picture. He probably thinks of it as a "cost of doing business."
I agree with the earlier postings that Tourre is just a tentacle of the big corruption machine. They need to go after them and go after them hard.
marble falls
(57,106 posts)Amonester
(11,541 posts)A Small Fine For The Fall Crook
erpowers
(9,350 posts)For most people that would be a big fine, but for someone like fabrice Tourre, who made $100 million in one year that is not a big fine. That is less than 1% of what he made in one year.
okaawhatever
(9,462 posts)bonus, which was earned "in part" for this transaction. The guy who made all the money was hedge fund bllonaire John Paulson. Problem is, his company is private and I don't think the SEC can find enough on him. Goldman Sachs was fined $550 millon for this.
erpowers
(9,350 posts)I was watching the news one day and I thought I heard the anchor say Tourre had made $100 million in one year during his career. Maybe I misunderstood what the anchor was saying.
okaawhatever
(9,462 posts)made $75 million off of that one deal. They may have meant that Tourre made 100 million FOR Goldman Sachs. This guy was in his mid-twenties so he probably made a small fraction of that and the people higher up the food chain made the rest.
gussmith
(280 posts)Such a petty fine in relation to the crime, the salary and (probably) the commissions of this criminal.