Goldman's Can't Shake Abacus Problems

Reuters has reported that a federal judge in Manhattan has consolidated securities class actions against Goldman Sachs and appointed three pension funds as co-lead plaintiffs in a lawsuit related to a collateralized debt obligation called Abacus. The judge appointed the Arkansas Teachers Retirement System, the West Virginia Investment Management Board and the Pipefitters National pension Group as the plaintiffs most capable of representing the class, since they had sustained the largest losses.

Abacus, a CDO linked to subprime mortgages, was allegedly designed to benefit one client who wanted to short the CDO while Goldman would sell the CDO to other clients. Goldman’s stock plummeted in April 2010 when the SEC filed suit for “making material misleading statements and discussions in connection with Abacus.” Goldman agreed to a $550 million settlement with the SEC last year.

Contact Us
Contact Us: (800) 259-9010