Goldman Fined over Information Leaks

Share On Facebook
share on Linkedin

Goldman Sachs (NYSE:GS) , the controversial New York based investment bank, has been fined $22 million by the U.S. Securities and Exchange Commission (SEC) for reportedly tipping off top clients about stocks.

The SEC alleges that between 2006 and 2011, information from weekly equity research meetings between the firm’s analysts and traders was leaked to some of its clients.

“Goldman failed to implement policies and procedures that adequately controlled the risk that research analysts could preview upcoming rating changes with select traders and clients,” said Robert Khuzami, the SEC’s director of enforcement.

The firm will pay $11 million to both the SEC and the Financial Industry Regulatory Authority (FINRA), a private self-regulatory organization.

While Goldman is being fined for trading improprieties, they are not being fined for insider trading.

Goldman’s internal policies called for required wide distribution of its analysts’ statements regarding stocks that it covered, but it did not apply to certain internal messages regarding “market color and short-term trading issues” that the firm failed to adequately define.

The news comes nearly a month after Greg Smith, a former London-based executive director at the firm, published an editorial in the New York Times bashing the firm’s practices and culture.

In July of 2010, Goldman was fined $550 million (the largest fine ever levied on a bank) by the SEC after the regulator concluded that the firm misled its clients with regard to toxic mortgage-backed assets.

Following that investigation, the FSA fined the bank £17.5 million for failing to notify the regulator that it was being investigated by the SEC.

CLICK HERE TO REGISTER FOR FREE ON ADVFN, the world's leading stocks and shares information website, provides the private investor with all the latest high-tech trading tools and includes live price data streaming, stock quotes and the option to access 'Level 2' data on all of the world's key exchanges (LSE, NYSE, NASDAQ, Euronext etc).

This area of the site is for independent financial commentary. These blogs are provided by independent authors via a common carrier platform and do not represent the opinions of ADVFN Plc. ADVFN Plc does not monitor, approve, endorse or exert editorial control over these articles and does not therefore accept responsibility for or make any warranties in connection with or recommend that you or any third party rely on such information. The information available at is for your general information and use and is not intended to address your particular requirements. In particular, the information does not constitute any form of advice or recommendation by ADVFN.COM and is not intended to be relied upon by users in making (or refraining from making) any investment decisions. Authors may or may not have positions in stocks that they are discussing but it should be considered very likely that their opinions are aligned with their trading and that they hold positions in companies, forex, commodities and other instruments they discuss.

Leave A Reply

Do you want to write for our Newspaper? Get in touch:

By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions

P: V: D:20230320 09:52:58