Goldman Sachs dishes out $5 billion in mortgage

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Goldman Sachs is set to pay approximately $5.1 billion to resolve several major investigations into allegations that the multinational investment bankers fraudulently marketed mortgage bonds before the global recession of 2008.

This amount is intended to settle claims coming from the U.S. Justice Department and the attorney general of New York and Illinois. Though the agreement hasn’t been finalized entirely, the CEO of Goldman Sachs, Lloyd C. Blankfein, is “pleased to have reached an agreement in principle to resolve these matters”. The accusations of foul play also come from several major financing companies in the USA, including the Federal Home Loan Banks of Chicago and Seattle, and the National Credit Union Administration.  The settlement amount consists of a civil monetary penalty of nearly $2.39 billion, a cash settlement of $875 million, and $1.8 billion in consumer relief.

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This is not the first investigation of its kind though. Ever since the last major financial crisis, authorities have been looking into many other large financing companies, including Bank of America, Citigroup, and JP Morgan Chase, with all of the investigations concerning the sale of mortgage-backed securities. Many investors into these financing companies, including banks and credit unions, went on to suffer heavy losses with many being forced to close thanks to the value of the securities plummeting alongside the housing market. Goldman Sachs has said that the settlement will reduce earnings for the last quarter of 2015 by about $1.5bn, after tax.

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Benjamin turned very quickly his passion of writing into a fulltime job. He enjoys writing basically on every single subject and therefore works with clients in the tourism, sports, beauty, financial and technology industries. He currently runs his own copywriting agency in the UK called Precise English.

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