April 17 (Bloomberg) -- Goldman Sachs Group Inc., ... didn’t disclose that it was warned nine months ago that investigators wanted to bring a case, people with direct knowledge of the talks said.
Goldman Sachs responded to the so-called Wells notice from the Securities and Exchange Commission within months and met with the agency officials trying to fend off the civil lawsuit, said the people, who declined to be identified because the talks weren’t public..
“The question is whether a general disclaimer like that is rendered misleading because you left out the specifics,” said Adam Pritchard, a former SEC attorney who teaches law at the University of Michigan in Ann Arbor. “The prudent, conservative choice is to disclose more,” because omissions can lead to shareholder lawsuits, Pritchard said.
Bloomberg News
Comment: With all of these friends at high places, GS could count on insider knowledge and political protection. Now, this is over. With the collapse of trust the dirt comes to surface. Expect more to come.
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