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There was a lot to digest from the 10-hour-plus grilling endured by Goldman Sachs Groups executives Tuesday, and today’s coverage in the media is fairly encyclopedic.
But one line of questioning that doesn’t seem to have captured much attention is Sen. Tom Coburn’s probing into why Goldman released to reporters the personal emails of Goldman Vice President Fabrice “Fab” Tourre.
Coburn first raised the issue with Tourre early on in the hearing. “How did it make you feel when [Goldman] released your emails,'' Coburn asked Tourre. The Goldman trader responded that he was “embarrassed” by the emails, and seemed rattled by Coburn question.
Coburn then asked whether Goldman was providing Tourre a company lawyer to defend him against the SEC’s civil fraud allegation. (It is.) Then, the Senator said Goldman had not only provided reporters with Tourre's email, but also with English translations of the documents. (Tourre ’s first language is French.)
Coburn never went so far as to accuse Goldman of seeking to set up Tourre as a scapegoat, but his line of questioning seemed to suggest he thought that Goldman may be looking to part ways legally with its employee. (In statements, Goldman has said repeatedly that it believes Tourre did nothing wrong)
Deal Journal spoke with a couple of legal experts on Monday who said it was in Goldman's interest to stick with Tourre. First, the investment bank has stated publicly that it stands behind Tourre and it would be awkward to reverse course. Second, Goldman may need Tourre as much as he needs Goldman. Left to defend himself, Tourre could turn on his former firm and reveal potentially embarrassing information about it, these lawyers said.
Of course, Coburn may simply have been trying to portray Goldman as being heartless and sleazy in an effort to discredit the firm's claims of having high ethical standards.
Indeed, later in the hearing Coburn asked Goldman finance chief David Viniar whether he thought it was unethical to release Tourre's emails. Viniar answered that he thought there was nothing unethical about it, but that he wasn't involved in the decision to release them. Coburn later asked CEO Lloyd Blankfein about the email release. Blankfein also denied knowing about the decision to release the emails, but mentioned that it was done amid a great deal of pressure from the media for information about the case.
Coburn pressed on, asking why Goldman didn't release emails from other employees, only Tourre's. Blankfein said he didn't know why.
Coburn's questioning seemed only to make Tourre more sympathetic in the court of public opinion. Is such a move afoot? Deal Journal notes that one reader writing on Tuesday's hearings left a simple comment: “Free Fab.”
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Does anyone really believe that Blankfein would not have been involved in the decision to release the emails?
Ahiru, Goldman is not “showing their disdain for the public and putting their arrogance on display.” It was a Congressional hearing — it’s not like they wanted to be there. They believe they broke no laws and behaved in the interests of their clients, and they often had situations in which one client would win and one would lose. That’s how trading works, when you sell your house in 2001 and prices skyrocket, you lost and the buyer won.
Ultimately all they care about is that their customers (their clients) still trust them. And given that no major client has abandoned them in the past week, when there is nothing forcing them to stay with GS, shows that the vast majority of their clients think this is just Congressional scapegoating.
Need better Financial regulation to make sure we do not face another economic recession due to these Wall Street smarties….they will make money…thts their job…so we need the government to better regulate the markets rather than crying and blaming on spilled milk…
Actually, from what I’m seeing on the countless articles and blogs are comments that disparage him. The public is as far from sympathetic to Farice tourre’s position as can be. I don’t blame them one bit.
As for the release of “personal” emails, they were sent using the GS company address, therefore they are GS property. It’s very low in general, but still short of unethical.
What is unethical (in this layman’s point of view, are the actions of Fabrice tourre and the GS firm. I get it, I get it, the world of Wall Street is essentially ‘amoral’, and therefore has no sense of right and wrong. But then when they show their disdain for the general public and put their agrrogance on display, they’re essentially bringing morality into it. After all, they’re judging us, so why not judge them in return?
Deal Journal is an up-to-the-minute take on the deals and deal makers that shape the landscape of Wall Street, including mergers and acquisitions, capital-raising, private equity and bankruptcy. In short, wherever money changes hands. Deal Journal is updated throughout each trading day with exclusive commentary, analysis, data, news flashes and profiles. The Wall Street Journal’s Michael Corkery is the lead writer, with contributions from other Journal reporters and editors. Send news items, comments and questions to deals@wsj.com.
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