Crisis panel subpoenas Goldman

WASHINGTON: The US panel investigating the causes of the financial crisis issued a subpoena to Goldman Sachs Group after the Wall Street firm failed to hand over documents in a “timely manner.” The Financial Crisis Inquiry Commission (FCIC) “has made it clear that it is committed to using its subpoena power” if firms under review don’t comply with information requests, the panel said in a statement on Monday. Moody’s and Berkshire Hathaway CEO Warren Buffett were previously subpoenaed by the commission.

The request for information shows the FCIC is turning attention to the most profitable firm in Wall Street history after investigating credit-rating companies and banks such as Citigroup and Bear Stearns Goldman Sachs has already drawn scrutiny from regulators and lawmakers for packaging mortgages into securities that triggered losses for investors when the housing market collapsed in 2007.

“We have been and continue to be committed to providing the FCIC with the information they have requested,” Goldman Sachs said in an e-mailed statement. Goldman Sachs fell $1.31, or 1%, to $140.94 at 11:24 am in New York Stock Exchange composite trading.

The SEC sued New York-based Goldman Sachs April 16, accusing the firm of selling a collateralised debt obligation tied to mortgages without disclosing to investors that hedge fund Paulson & Co helped pick the underlying securities. Paulson was betting the CDO would fail, the SEC said. Goldman has said the suit is “unfounded in law and fact.” —