Wow... Look at This... The SEC Accuses Goldman Sachs of Civil Fraud

Well, it's my first day as an independent blogger and look what happens- the SEC accuses Goldman Sachs of all companies of civil fraud. I'm taking this as a sign of things to come...

Now, before I elaborate- I've always known Goldman Sachs as having a bit of "The Firm" quality to them... Like the John Grisham novel and the movie starring Tom Cruise (good movie by-the-way!)- a company you wouldn't want to mess with. Even if you did- who would listen?

Did I mention I've always wanted to work for them? Really, if you have to work on Wall Street- why not be it at Goldman Sachs? After all, they're known for their smarts, their shrewdness and widely regarded as the 800-lb gorilla in the room... Around Christmas- everyone loves to relish at the size of their bonus pool... We're talking Billions (with a capital "B") of dollars. Young men and women making hundreds of thousands of dollars on average.

But I've known many "media mongers" (lets call them that) who have "messed with them," or have run with the "heir of messing with them..." (And they're probably having a proverbial field day with this topic today...) So what, even if they did do anything wrong- they have enough clout and people in high places to make it go away.

You're not going to take-down Goldman Sachs.

But in the news... According to the Associated Press as published on Yahoo! Finance:

"The government has accused Goldman Sachs & Co. of defrauding investors by failing to disclose conflicts of interest in mortgage investments it sold as the housing market was faltering.

The Securities and Exchange Commission said in a civil complaint Friday that Goldman failed to disclose that one of its clients helped create -- and then bet against -- subprime mortgage securities that Goldman sold to investors.

Investors in the mortgage securities lost more than $1 billion, the SEC said. The agency is seeking to recoup profits reaped on the deal.

The SEC alleged that Paulson & Co, a major hedge fund run by billionaire John Paulson, worked with Goldman in creating a collateralized debt obligation, and stood to benefit as its value fell, costing investors more than $1 billion. That is roughly the amount that Paulson is estimated to have made by betting against the CDO.

Fabrice Tourre, a Goldman vice president who the SEC said was principally responsible for creating the product, was also charged with fraud. Paulson was not charged.

Goldman Sachs denied the allegations. In a statement, it called the SEC's charges "completely unfounded in law and fact" and said it will contest them.

The charges come as lawmakers seek to crack down on Wall Street practices that helped cause the financial crisis. Among proposals Congress is weighing are tougher rules for complex investments like those involved in the alleged Goldman fraud.

The Goldman client implicated in the fraud is one of the world's largest hedge funds, Paulson & Co., which paid Goldman roughly $15 million for structuring the deals in 2007.

Goldman Sachs shares fell more than 13 percent after the SEC announcement, which also caused shares of other financial companies to sink. The Dow Jones industrial average fell more than 140 points in midday trading."

I'm rather surprised they've gotten themselves caught-up in something like this; there are many who have accused them of much, much worse, and well- nothing.

Did I say I always wanted to work for them? Why? The money- but the older I get- the more people I talk to, employees of Goldman and the like- well- don't believe the hype. It's just a company to most. It's a tough place to work for some- competitive. It's just a job.

While competition is a good thing, when it comes to Wall Street, money, or your career- it can make for a hard life at any price. I know veterans of the company who have put ten, twenty, 25 years-in, only to be cast aside or let go completely. It does, however, bode well for a resume! And alas, as I always tell people who have a good thing blow-up in their face- nothing, not even you last forever.

It's business, pure and simple. But the older I get the more I realize- if you're going to invest your life and time with a company for years or decades- look beyond the business, and the news too for that matter.

To some it's a great place to do business and make money with. Right or wrong- this is civil case right?

I mean, didn't O.J. Simpson lose the civil case? So he paid a fine... Goldman Sachs can afford a fine, trust me.

So, The Car Guy Gets It... He does.

It does, however conjure up memories of working in the same building as Goldman Sachs in downtown Manhattan as a younger man (for another firm I care not to even think about as it pains me to even mention it...).

Goldman's reputation, their cafeteria (longer story) are all top, top-notch. Way out-of-reach for this State University educated, fairly well-bred and groomed white male from Bergen County.

But that's a story for another time. "Fairly well-bred and groomed" doesn't cut it. You need connections.

Connections. The right ones. Goldman has those too.