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Goldmann-Sachs finally admits what the rest of us knew: They defrauded us and caused the 2008 financial crash

Goldman Sachs Finally Admits it Defrauded Investors During the Financial Crisis

by Lucinda Shen - APRIL 11, 2016, 2:04 PM EDT

Goldman Sachs effectively admitted that it had knowingly misled investors to buy shoddy products.

Investment banking giant Goldman Sachs has agreed to a list of “facts” in addition to paying $5.1 billion to settle a lawsuit related to its handling of mortgage-backed securities leading up to the 2007 financial crisis, the U.S. Department of Justice announced Monday.

It’s a definite improvement on the DoJ settlements of a few years ago when Wall Street firms were able to get away with saying they “neither admit or deny the charges.” But it’s unlikely to quell critics that say the government hasn’t done enough to punish bankers in the wake of the financial crisis. Just like in past settlements, no individual bankers have been charged with wrong doing.

From 2005 to 2007, Goldman issued and underwrote many mortgages and securities that had been backed by residential loans borrowed by consumers with shoddy credit ratings. That helped tip the economy into recession after the housing bubble burst in 2007, leading to a tsunami of foreclosures and delinquencies. That caused billions of dollars in losses for investors. The settlement mentioned mortgage loans that had been originated by Countrywide, Fremont, and others. Countrywide was bought by Bank of America is early 2008. Fremont is no longer in business.

Goldman agreed to pay $2.39 billion in civil penalties, and another $1.8 billion in relief in the form of loan forgiveness and financing for affordable housing. An additional $875 million will be paid in cash to resolve claims from other federal and state entities.

“This resolution holds Goldman Sachs accountable for its serious misconduct in falsely assuring investors that securities it sold were backed by sound mortgages, when it knew that they were full of mortgages that were likely to fail,” said Acting Associate Attorney General Stuart F. Delery in a statement....


Read more:
http://fortune.com/2016/04/11/goldman-sachs-doj-settlement/

In Virginia, let's not forget that former Congressman Eric Cantor's wife as a VP at Goldmann-Sachs before she became chairman of the Virginia State Retirement System.  Which may explain why VRS investments are not performing well at all.


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