Close eye on Goldman
Hospitals gauging fallout from Senate hearings
Hospital systems that have employed Goldman Sachs Group to manage their bond offerings said they are closely monitoring whether last week’s explosive Senate hearings on the firm will have any effect in the market.
Seven current and former Goldman Sachs officials testified before the Senate’s Permanent Investigations Subcommittee. Senators excoriated the officials and read from Goldman e-mails that described some mortgage-backed securities sold to clients as “junk” and “crap,” according to the Associated Press. The Securities and Exchange Commission filed a civil complaint in April against Goldman and one former Goldman trader, alleging that the company defrauded investors by misstating and omitting key facts regarding a financial product related to subprime mortgages. A criminal investigation of the company by the U.S. attorney in Manhattan also was reported last week by the Washington Post.
In his remarks to the subcommittee, Goldman CEO Lloyd Blankfein said the firm did not bet heavily against mortgagerelated securities and lost $1.2 billion on