The SEC and Goldman Sachs Group Inc.

This article, depicts the findings that the Securities Exchange Commission gathered relating to the the fraud case filed against Goldman Sachs Group Inc. on Friday April 16th. However the SEC still has a great amount of persuading to do in terms of the jury, to convey the actual purposes for some of the activities Goldman was involved in. The main issue at hand deals with Goldman's actions and investing during the credit crisis of 2009.

Goldman is said to have been selling products to investors that were correlated to the performance of specific mortgages without ever explaining to investors that a hedge fund betting on these mortgages helped the product. Outside lawyers feel that the Securities Exchange Commission in fact has the right amount of information regarding Goldman's activity in order to prosecute them for the firms actions. However it is quite important, regardless of the outcome, that the SEC delivers a meaningful message through this litigation process.

Goldman Sachs replied to the accusations in that the firm was quite "disappointed" with the SEC filing suit and bringing up these allegations upon their firm. Goldman feels that all investors should know that others are at all times betting on the direction of the product, by either betting for the success or failure of the product. In addition, lawyers who reviewed the complaint from the SEC agreed that their was nothing illegal about Goldman's actions.

Paulson & Co. was the hedge fund that helped in designing the product, however it was Goldman's responsibility to disclose Paulson's role. Bradley Simon, a white collar crime defense lawyer and partner of Simon and Partners LLP, stated that the SEC is going to have to prove that Goldman not only knew Paulson & Co. was short selling it, but also had a large role in gathering weak mortgages to bet against it.

The complaint filed by the SEC, alleges that Goldman intentionally did not disclose this information to investors pertaining to Paulson's involvement, however led them to believe that ACA Management LLC, an independent mortgage analysis firm, designed the product.

This case will all come down to the jurors, if it even makes it that far, however being such a complex and intricate case, there might be difficulty understanding all the financial complexity involving the product. However, Goldman has been frowned upon by many due to their firm receiving bailout money while still paying out large bonuses to top executives, so this will be an interesting case.

This issue, will allow us to examine both a top fortune 500 corporation as well as the sternness of a federal agency. The SEC in this particular case is taking an aggressive stand and will more than likely have to deliver exceptionally in order for the actions of Goldman Sachs to be punishable. Was Goldman deceitful in their ways of doing business and did they act unethically when trying to sell this particular product? Investor relations for such a firm, is quite vital in a situation like this. For instance, the IR department must preserve the corporations name in a time like this, as well as convey to top investors that Goldman is a trustworthy corporation and would never partake in such activities that would be detrimental to the firm and/or investors.