NEW YORK (AP) – Jurors at a Manhattan trial of a former Goldman Sachs trader heard him described Monday both as an architect of a massive securities fraud and as a low-level scapegoat for the mortgage market meltdown that began in 2007.
Fabrice Tourre faces allegations from a 2010 lawsuit brought by the Securities and Exchange Commission against him and Goldman Sachs in what was called the most significant legal action related to the mortgage securities crisis that helped push the country into recession.
“This is a case about Wall Street greed,” SEC lawyer Matthew Martins said in opening arguments at the federal civil trial. “It’s a case about lies, trickery and deception. ... In the end it was Wall Street greed that drove Mr. Tourre to lie and deceive.”
Defense attorney Pamela Chepiga countered that her client “never misled anyone.”
The SEC has accused Tourre of deliberately selling investors mortgage-backed securities that he knew were doomed to fail. The maneuver allowed the hedge fund Paulson & Co. Inc., and its billionaire president, John A. Paulson, to make $1 billion and Goldman Sachs to make millions in fees by betting against the investment.
Tourre “abused his position of responsibility to help an important hedge fund client make $1 billion,” Martins said.