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DeFazio goes after Goldman Sachs

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High Five
Tuesday, April 20, 2010

Three days after Goldman Sachs was charged with misleading and defrauding investors, Congressman Peter DeFazio is calling for a more thorough investigation of the bank's actions.

DeFazio and Maryland Congressman Elijah E. Cummings wrote a letter to Securities and Exchange Commission Chair Mary Shapiro demanding a closer look into the scandal.

The criminal complaint on Friday "is based on a single CDO known as ABACUS 2007-AC1,'' the letter states. CDO is shorthand for collateralized debt obligations, complex investments tied to mortgage securities that Goldman and other financial institutions sold during the peak of the housing bubble.

"However, the ABACUS 2007-AC1 offering was part of a series of 25 such CDOs, all arranged by Goldman Sachs. It is not beyond the realm of comprehension that the 24 remaining ABACUS transactions included similar materially misleading statements to investors in order to protect Goldman’s internal proprietary bets,'' the letter says.

Read the full story at OregonLive.com.

{biztweet}Goldman Sachs Peter DeFazio{/biztweet}

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