New York (HedgeCo.net) – The SEC warned that “half truths and deception” would not be tolerated on Wall Street, as they fined Goldman Sachs over $550 million, ordering a sweeping review of the companies business standards.

Without admitting or denying the allegations, Goldman accepted the fine and agreed that the marketing materials it issued to hedge fund investors for the Abacus transaction gave “incomplete information”, The Guardian reported.

Fabrice Tourre, the employee who had been involved in marketing the collateralized debt obligation (CDO), remains under investigation by the SEC according to The Guardian.

“This settlement is a stark lesson to Wall Street firms that no product is too complex, and no investor too sophisticated, to avoid a heavy price if a firm violates the fundamental principles of honest treatment and fair dealing.” Robert Khuzami, director of the SEC’s division of enforcement, said, according to the paper, “the unmistakable message of this lawsuit … is that half-truths and deception cannot be tolerated”.

Alex Akesson
Editor for HedgeCo.net
alex@hedgeco.net
HedgeCo.Net is a premier hedge fund database and community for qualified and accredited investors only. Membership in HedgeCo.net is FREE and EASY. We also offer FREE LISTINGS for Hedge Funds!