'Fabulous Fab,' Goldman offer vigorous defense before Senate

story by The Hill

written by Ian Swanson

Goldman Sachs representatives (swearing in above) are aggressively defending their actions today in testimony to a Senate panel.

Fabrice Tourre the Goldman vice president named in fraud charges brought two weeks ago by the Securities and Exchange Commission against the firm, categorically denied the SEC’s allegations he failed to disclose material information to investors about an investment that lost millions.

Tourre, who called himself “Fabulous Fab” in e-mails to friends released by the SEC, said he would defend himself vigorously in court against “the false claim.”

Tourre was appearing on the first panel of witnesses before the Senate Permanent Committee on Investigations, which is probing the financial crisis.

Goldman has come under fierce attack from the panel’s chairman, Sen. Carl Levin (D-Mich.), who said the firm misled investors by selling mortgage-backed securities that Goldman was betting would fail.(photo by Reuters left of Goldman-Sachs protester)

Levin has also accused the firm of profiting handsomely by betting against mortgage-backed securities, even as home owners across the country suffered.

Goldman Sachs CEO and Chairman Lloyd Blankfein, who will appear on the final panel to testify Monday, has denied the charges from Levin and the SEC.

Although Goldman showed a profit since the 2008 financial crisis, the company lost about $1.2 billion for its involvement in the residential housing market, Blankfein will say in his testimony.

The SEC alleges Goldman and Tourre sold a mortgage-backed security that was put together by a hedge fund that believed the security would fail and bet against it.