Bloomberg News

Ex-Goldman VP Tourre Should Pay $1.1 Million, SEC Says (1)

December 17, 2013

Fabrice Tourre, the ex-Goldman Sachs Group Inc. (GS:US) vice president found liable for his part in a failed $1 billion investment, should pay $1.1 million in fines, disgorgement and interest, the U.S. Securities and Exchange Commission said.

Tourre, 34, was found liable Aug. 1 after a jury trial at which the SEC claimed he intentionally misled investors in a subprime mortgage vehicle called Abacus. The agency alleged Tourre lied about the role played by billionaire John Paulson’s Paulson & Co. hedge fund, which helped choose the portfolio of securities underlying Abacus then made a billion-dollar bet it would fail.

“These remedies are appropriate because the conduct that the SEC proved at trial was egregious,” the SEC said in a brief filed yesterday in federal court in Manhattan. “Tourre, a licensed securities professional, took the lead in structuring a financial product that was secretly designed to maximize its potential for failure.”

The SEC asked U.S. District Judge Katherine Forrest to impose a fine of $910,000 and order that he disgorge $175,463 of his 2007 bonus plus $62,858 in interest. The agency is also seeking an order barring Tourre from violating the securities laws in the future.

Chris Kittredge, a spokesman for Tourre with the firm Sard Verbinnen & Co., declined to comment on the SEC filing.

The case is SEC v. Tourre, 10-cv-03229, U.S. District Court, Southern District of New York (Manhattan).

To contact the reporter on this story: Bob Van Voris in federal court in Manhattan at rvanvoris@bloomberg.net


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    (Goldman Sachs Group Inc/The)
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