{"id":6062,"date":"2016-11-04T16:36:32","date_gmt":"2016-11-04T21:36:32","guid":{"rendered":"https:\/\/www.institutionalinvestorsecuritiesblog.com\/?p=1193"},"modified":"2022-05-17T14:35:49","modified_gmt":"2022-05-17T19:35:49","slug":"goldman-sachs-settles-securities-fraud-lawsuit-abacus-cdo","status":"publish","type":"post","link":"https:\/\/www.investorlawyers.com\/blog\/goldman-sachs-settles-securities-fraud-lawsuit-abacus-cdo\/","title":{"rendered":"Goldman Sachs Settles Securities Fraud Lawsuit Over Abacus CDO"},"content":{"rendered":"

\t\t\t\tGoldman Sachs Group Inc. (GS) has arrived at a settlement with \u00a0ACA Financial Guaranty Corp. The bond insurer\u2019s securities fraud lawsuit accuses the investment bank of fraudulently persuading it to guarantee payments on the\u00a0,\u00a0a collateralized debt obligation, prior to the financial crisis. ACA Financial Guaranty claims that Goldman and hedge fund Paulson & Co. fooled it into insuring the CDO. Details of the CDO fraud settlement have not been disclosed.<\/p>\n

In its $120M CDO fraud case, ACA claimed it was deceived into thinking that Paulson & Co. would hold Abacus for the long-term, when, in fact, the fund played a part in choosing the CDO\u2019s assets before taking a short position and bet that the mortgages underlying the securities would fail. ACA alleged that Abacus was set up in a manner to allow Paulson to make \u201chuge profits\u201d and Goldman to\u00a0earn\u00a0\u201chuge fees.\u201d<\/p>\n

Although a NY judge had said that the case, brought in 2011, could proceed, an appeals court reversed that decision in 2013. The New York Supreme Court reversed the appeals court\u2019s ruling in 2015.<\/p>\n

Continue Reading \u203a<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Goldman Sachs Group Inc. (GS) has arrived at a settlement with \u00a0ACA Financial Guaranty Corp. The bond insurer\u2019s securities fraud lawsuit accuses the investment bank of fraudulently persuading it to guarantee payments on the\u00a0,\u00a0a collateralized debt obligation, prior to the financial crisis. ACA Financial Guaranty claims that Goldman and hedge fund Paulson & Co. fooled […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[3742,3752,3947],"tags":[3711,3712],"class_list":["post-6062","post","type-post","status-publish","format-standard","hentry","category-collateralized-debt-obligation","category-financial-firms","category-goldman-sachs","tag-abacus-2007-ac1","tag-aca-financial-guaranty"],"yoast_head":"\nGoldman Sachs Settles Securities Fraud Lawsuit Over Abacus CDO — Investor Lawyers Blog — November 4, 2016<\/title>\n<meta name=\"description\" content=\"Goldman Sachs Group Inc. (GS) has arrived at a settlement with \u00a0ACA Financial Guaranty Corp. 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