DAILY NEWS: Goldman Sachs 'issued with subpoena' over actions during credit crisis

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Manhattan's district attorney believed to have sent subpoena to Goldman Sachs as part of inquiry into the firm's behaviour before and during financial meltdown

Manhattan's top law enforcer is believed to have issued subpoenas to Goldman Sachs as he investigates the firm's activity during the credit crisis.

Manhattan district attorney Cyrus Vance Jr is pursuing claims made by an official senate investigation into Wall Street's role in the housing market collapse.

The report, published in April, singled out Goldman Sachs for particular criticism, accusing the bank of misleading buyers of mortgage-linked investments. The bank encouraged buyers to invest in mortgage-related securities even as it was betting heavily against the mortgage market, according to the report.

Senator Carl Levin, a persistent critic of the bank, accused Goldman executives, including chief executive Lloyd Blankfein, of giving "misleading and inaccurate" evidence to the committee. Goldman said its executives' testimony was "truthful and accurate".

The report was referred to the US department of justice and the financial watchdog the Securities and Exchange Commission, which are also investigating.

Vance, the son of president Jimmy Carter's secretary of state, was appointed Manhattan's district attorney in 2009. Earlier this year he said that his office had active investigations into Wall Street "across the board" and called for the his powers to be expanded in order to tackle large-scale white-collar crime. The Manhattan DA's office has tackled many high-profile white-collar cases, from BCCI to Tyco.

A subpoena is only a request for information and does not mean the company is a target of a criminal investigation.

Dominic Rushe

guardian.co.uk © Guardian News & Media Limited 2011 | Use of this content is subject to our Terms & Conditions | More Feeds

Maev Kennedy 02 Jun, 2011

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Source: http://www.guardian.co.uk/business/2011/jun/02/goldman-sachs-gets-subpoena-over-credit-crisis-acitivity
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