Legal practices of the major investment firms

Goldman Sachs

Forensic accounting

Fraud at Goldman Sachs

The recent recession and financial scandal brought to light many unethical, illegal, and quasi-legal practices of the major investment firms. One example of this was the Goldman Sachs securities fraud case, in which the firm was accused of creating and selling bundled mortgage investments in an instrument that was intended to fail and which the company’ bet against’ with a desire to make a profit (Storey & Morganson 2010).

The government’s case against Goldman Sachs concerned Abacus 2007-AC1, one of 25 investment vehicles specifically created to allow its clients to “bet against the housing market” (Storey & Morganson 2010). This “initially protected Goldman from losses when the mortgage market disintegrated and later yielded profits for the bank” (Storey & Morganson 2010). Ironically, one of the initial marvels of the credit crisis was the degree to which Goldman appeared to emerge unscathed, in contrast to its rivals.

“Goldman told investors that the bonds would be chosen by an independent manager,” but instead allowed John A. Paulson, “a prominent hedge fund manager who earned an estimated $3.7 billion in 2007 by correctly wagering that the housing bubble would burst,” to select mortgage bonds, despite his personal interest in their losing value (Storey & Morganson 2010). “Goldman then sold the package to investors like foreign banks, pension funds and insurance companies, which would profit only if the bonds gained value,” which of course they did not (Storey & Morganson 2010).

Goldman initially said that it had lost money in the transactions overall and had acted with transparency. “The firm said the losses in the deal came from the overall collapse of the mortgage market, not from the way the deal was structured” (Storey & Morganson 2010). But “when Goldman sold shares in Abacus to investors, the bank and Mr. Tourre disclosed only the ratings of those bonds,” not Paulson’s interests in seeing the creditors default (Storey & Morganson 2010). By the end of 2007, Mr. Paulson’s credit hedge fund was up 590%” (Storey & Morganson 2010). In the official SEC statement, detailing the civil suit it was stated: “the product was new and complex but the deception and conflicts are old and simple…Goldman wrongly permitted a client that was betting against the mortgage market to heavily influence which mortgage securities to include in an investment portfolio, while telling other investors that the securities were selected by an independent, objective third party” (Delaney 2011:2; SEC Charges Goldman Sachs with fraud in structuring and marketing of CDO tied to subprime mortgages). Although the credit default swaps were a new financial instrument, the nature of Paulson’s ‘betting against’ the assets he was selling was a conflict of interest.

It should be noted that Paulson was not the subject of the lawsuit, but rather Goldman itself because Sachs Vice President Fabrice Tourre was principally responsible for creating ABACUS 2007-AC1. “Tourre structured the transaction, prepared the marketing materials, and communicated directly with investors. Tourre allegedly knew of Paulson & Co.’s undisclosed short [selling] interest and role in the collateral selection process” and had a responsibility to inform investors and police those conflicts (SEC Charges Goldman Sachs with fraud in structuring and marketing of CDO tied to subprime mortgages, 2010, SEC). In addition, he misled “ACA Management LLC, a firm managing 22 CDOs with assets of $15.7 billion” by “indicating that Paulson & Co.’s interests in the collateral selection process were closely aligned with ACA’s interests. In reality, however, their interests were sharply conflicting” (Delaney 2011:2; SEC Charges Goldman Sachs with fraud in structuring and marketing of CDO tied to subprime mortgages, 2010, SEC). The worse the failure of the assets, the more Paulson would profit.

Paulson effectively ‘stacked the deck’ against the success of ACA. “Paulson’s selection criteria [for Abacus] favored [residential mortgage-backed securities] that included a high percentage of adjustable rate mortgages, relatively low borrower FICO scores, and a high concentration of mortgages in states like Arizona, California, Florida and Nevada that had recently experienced high rates of home price appreciation” (Delaney 2011:2). Paulson was not simply lucky in betting against the failure of ABACUS 2007-AC1; rather the security was specifically engineered to fail.

“John Paulson picked those lousy underlying assets for the Abacus CDO so that he could bet against them by purchasing ‘credit default swaps’ — insurance policies that pay out if borrowers default” and the uniquely ‘bad’ instrument would not have existed without the agency of Goldman Sachs (Delaney 2011: 3). There was no ‘risk management’ — one of the hallmarks of intelligent and conservative investment in the creation of ABACUS 200-AC1. All of the assets within ABACUS were of the worst kind, with the highest-risk borrowers, without any safe assets to effectively protect investors. This was unusual and not standard business practices. Moreover, ABACUS was highly-rated as a non-risky asset by Goldman, despite all evidence to the contrary that even a layperson who had investigated the asset could have detected, had Goldman acted with transparency.

Regarding the alleged harms done by Goldman, it was not simply the persons who trusted Paulson who were harmed. Rather, the “creation and sale of synthetic CDO [credit default swaps] s helped make the financial crisis worse than it might otherwise have been, effectively multiplying losses by providing more securities to bet against. When you buy protection against an event that you have a hand in causing you are buying fire insurance on someone else’s house and then committing arson” (Delaney 2011:4). Many people got ‘burned,’ including ordinary consumers whose retirement accounts and other assets were decimated in the credit crisis. The fallout from Goldman’s actions ratcheted up the fear in the financial community and caused lending to freeze and slowed the world economy down to a crawl as a result. Many workers lost jobs who had nothing to do with the housing crisis and never took out a subprime loan. Although the economy would have been hard-hit, given the inevitability of the defaults in the poorly-policed subprime market, credit default swaps and a lack of transparency amplified the problem.

Eventually, Goldman Sachs agreed to pay $550 million to settle the fraud suit brought by the SEC, and the government decided to settle rather than to press the matter further (Goldfarb 2010). Although $550 million may seem like a great deal of money to an ordinary individual, to Goldman such a sum was relatively trivial, and likely written down to the cost of doing business, rather than a serious rebuke and testimony to the fact that it needed to improve its ethical standards. Goldman issued a statement that it ‘regretted’ the actions it took, and as part of the settlement conceded to the government’s main contentions regarding its wrongdoing. But this only represented “a tiny fraction of its $13 billion in annual profits” (Goldfarb 2010).

Given the expense of bringing the case to trial, the government’s actions are understandable to a point. But the trivial sum extracted in the settlement hardly even amounts to a ‘slap on the wrist’ regarding Goldman’s lack of ethics. Even more inexcusable is the lack of regulation that the government has exercised over Wall Street, even in the wake of the credit crisis. Four years later and “the Justice Department has yet to convict a single high-profile banker” (Koba 2012). The major piece of financial reform, the Dodd-Frank Bill of 2008, “created an Office of Credit Rating at the Securities and Exchange Commission (SEC) to regulate credit ratings agencies like Moody’s and Standard & Poor’s” and the Consumer Financial Protection Bureau (CFPB), to protect consumers from ‘unscrupulous business’ practices by banks” such as what occurred in the case of Goldman’s actions (Koba 2012).

However many analysts, including the chair of the Dallas Federal Reserve Bank believe that Dodd-Frank did not go nearly far enough. “You need to reduce the tight coupling, by eliminating or severely restricting the use of the products that are big contributors to the interconnectedness. Credit default swaps top our list” (Dallas Fed’ Fisher criticizes Dodd Frank, 2012, Naked Capitalism). There is also a question of weak enforcement of existing laws — the problem with Goldman was not that what it was doing was legal (it was not) but that the laws were inexpertly enforced and the penalty was so mild. Many attribute this to the powerful financial influence Wall Street holds in funding elections. Few politicians, Democrat or Republican, can ignore its major financing power. The deregulation that occurred in the 1990s, including the dismantling of the Glass-Steagall Act which separated investment banking from commercial baking (which many consider to be an important protection for ordinary investors) is still in place. “Without the banks providing financing to the mortgage brokers and Wall Street while underwriting their own issues of toxic securities, the entire pyramid scheme would never have got off the ground. It was Glass-Steagall that prevented the banks from using insured depositories to underwrite private securities and dump them on their own customers” (Rickards 2010). However, members of Congress have a financial interest in taking a hands-off attitude towards government regulation, particularly when public pressure and interest for oversight begins to wane.


Dallas Fed’ Fisher criticizes Dodd Frank. (2012). Naked Capitalism. Retrieved:

Delaney, Arthur. (2011). Goldman Sachs fraud explained. Huffington Post. Retrieved:

Goldfarb, Zachary. (2010). Goldman Sachs to pay record settlement in fraud suit, change business practices. The Washington Post. Retrieved:

Koba, Mark. (2012). CNBC explains Dodd Frank. CNBC. Retrieved:

Rickards, James. (2012). Repeal of Glass Steagall caused the financial crisis.

US News & World Report. Retrieved:

SEC Charges Goldman Sachs with fraud in structuring and marketing of CDO tied to subprime mortgages. (2010). SEC. Retrieved:

Storey, Louise & Gretchen Morganson. (2010). S.E.C. accuses Goldman of fraud in housing deal. The New York Times. Retrieved:

Get Professional Assignment Help Cheaply

Buy Custom Essay

Are you busy and do not have time to handle your assignment? Are you scared that your paper will not make the grade? Do you have responsibilities that may hinder you from turning in your assignment on time? Are you tired and can barely handle your assignment? Are your grades inconsistent?

Whichever your reason is, it is valid! You can get professional academic help from our service at affordable rates. We have a team of professional academic writers who can handle all your assignments.

Why Choose Our Academic Writing Service?

  • Plagiarism free papers
  • Timely delivery
  • Any deadline
  • Skilled, Experienced Native English Writers
  • Subject-relevant academic writer
  • Adherence to paper instructions
  • Ability to tackle bulk assignments
  • Reasonable prices
  • 24/7 Customer Support
  • Get superb grades consistently

Online Academic Help With Different Subjects


Students barely have time to read. We got you! Have your literature essay or book review written without having the hassle of reading the book. You can get your literature paper custom-written for you by our literature specialists.


Do you struggle with finance? No need to torture yourself if finance is not your cup of tea. You can order your finance paper from our academic writing service and get 100% original work from competent finance experts.

Computer science

Computer science is a tough subject. Fortunately, our computer science experts are up to the match. No need to stress and have sleepless nights. Our academic writers will tackle all your computer science assignments and deliver them on time. Let us handle all your python, java, ruby, JavaScript, php , C+ assignments!


While psychology may be an interesting subject, you may lack sufficient time to handle your assignments. Don’t despair; by using our academic writing service, you can be assured of perfect grades. Moreover, your grades will be consistent.


Engineering is quite a demanding subject. Students face a lot of pressure and barely have enough time to do what they love to do. Our academic writing service got you covered! Our engineering specialists follow the paper instructions and ensure timely delivery of the paper.


In the nursing course, you may have difficulties with literature reviews, annotated bibliographies, critical essays, and other assignments. Our nursing assignment writers will offer you professional nursing paper help at low prices.


Truth be told, sociology papers can be quite exhausting. Our academic writing service relieves you of fatigue, pressure, and stress. You can relax and have peace of mind as our academic writers handle your sociology assignment.


We take pride in having some of the best business writers in the industry. Our business writers have a lot of experience in the field. They are reliable, and you can be assured of a high-grade paper. They are able to handle business papers of any subject, length, deadline, and difficulty!


We boast of having some of the most experienced statistics experts in the industry. Our statistics experts have diverse skills, expertise, and knowledge to handle any kind of assignment. They have access to all kinds of software to get your assignment done.


Writing a law essay may prove to be an insurmountable obstacle, especially when you need to know the peculiarities of the legislative framework. Take advantage of our top-notch law specialists and get superb grades and 100% satisfaction.

What discipline/subjects do you deal in?

We have highlighted some of the most popular subjects we handle above. Those are just a tip of the iceberg. We deal in all academic disciplines since our writers are as diverse. They have been drawn from across all disciplines, and orders are assigned to those writers believed to be the best in the field. In a nutshell, there is no task we cannot handle; all you need to do is place your order with us. As long as your instructions are clear, just trust we shall deliver irrespective of the discipline.

Are your writers competent enough to handle my paper?

Our essay writers are graduates with bachelor's, masters, Ph.D., and doctorate degrees in various subjects. The minimum requirement to be an essay writer with our essay writing service is to have a college degree. All our academic writers have a minimum of two years of academic writing. We have a stringent recruitment process to ensure that we get only the most competent essay writers in the industry. We also ensure that the writers are handsomely compensated for their value. The majority of our writers are native English speakers. As such, the fluency of language and grammar is impeccable.

What if I don’t like the paper?

There is a very low likelihood that you won’t like the paper.

Reasons being:

  • When assigning your order, we match the paper’s discipline with the writer’s field/specialization. Since all our writers are graduates, we match the paper’s subject with the field the writer studied. For instance, if it’s a nursing paper, only a nursing graduate and writer will handle it. Furthermore, all our writers have academic writing experience and top-notch research skills.
  • We have a quality assurance that reviews the paper before it gets to you. As such, we ensure that you get a paper that meets the required standard and will most definitely make the grade.

In the event that you don’t like your paper:

  • The writer will revise the paper up to your pleasing. You have unlimited revisions. You simply need to highlight what specifically you don’t like about the paper, and the writer will make the amendments. The paper will be revised until you are satisfied. Revisions are free of charge
  • We will have a different writer write the paper from scratch.
  • Last resort, if the above does not work, we will refund your money.

Will the professor find out I didn’t write the paper myself?

Not at all. All papers are written from scratch. There is no way your tutor or instructor will realize that you did not write the paper yourself. In fact, we recommend using our assignment help services for consistent results.

What if the paper is plagiarized?

We check all papers for plagiarism before we submit them. We use powerful plagiarism checking software such as SafeAssign, LopesWrite, and Turnitin. We also upload the plagiarism report so that you can review it. We understand that plagiarism is academic suicide. We would not take the risk of submitting plagiarized work and jeopardize your academic journey. Furthermore, we do not sell or use prewritten papers, and each paper is written from scratch.

When will I get my paper?

You determine when you get the paper by setting the deadline when placing the order. All papers are delivered within the deadline. We are well aware that we operate in a time-sensitive industry. As such, we have laid out strategies to ensure that the client receives the paper on time and they never miss the deadline. We understand that papers that are submitted late have some points deducted. We do not want you to miss any points due to late submission. We work on beating deadlines by huge margins in order to ensure that you have ample time to review the paper before you submit it.

Will anyone find out that I used your services?

We have a privacy and confidentiality policy that guides our work. We NEVER share any customer information with third parties. Noone will ever know that you used our assignment help services. It’s only between you and us. We are bound by our policies to protect the customer’s identity and information. All your information, such as your names, phone number, email, order information, and so on, are protected. We have robust security systems that ensure that your data is protected. Hacking our systems is close to impossible, and it has never happened.

How our Assignment  Help Service Works

1.      Place an order

You fill all the paper instructions in the order form. Make sure you include all the helpful materials so that our academic writers can deliver the perfect paper. It will also help to eliminate unnecessary revisions.

2.      Pay for the order

Proceed to pay for the paper so that it can be assigned to one of our expert academic writers. The paper subject is matched with the writer’s area of specialization.

3.      Track the progress

You communicate with the writer and know about the progress of the paper. The client can ask the writer for drafts of the paper. The client can upload extra material and include additional instructions from the lecturer. Receive a paper.

4.      Download the paper

The paper is sent to your email and uploaded to your personal account. You also get a plagiarism report attached to your paper.

smile and order essaysmile and order essay PLACE THIS ORDER OR A SIMILAR ORDER WITH US TODAY!!!

order custom essay paper

What Will You Get?

We provide professional writing services to help you score straight A’s by submitting custom written assignments that mirror your guidelines.

Premium Quality

Get result-oriented writing and never worry about grades anymore. We follow the highest quality standards to make sure that you get perfect assignments.

Experienced Writers

Our writers have experience in dealing with papers of every educational level. You can surely rely on the expertise of our qualified professionals.

On-Time Delivery

Your deadline is our threshold for success and we take it very seriously. We make sure you receive your papers before your predefined time.

24/7 Customer Support

Someone from our customer support team is always here to respond to your questions. So, hit us up if you have got any ambiguity or concern.

Complete Confidentiality

Sit back and relax while we help you out with writing your papers. We have an ultimate policy for keeping your personal and order-related details a secret.

Authentic Sources

We assure you that your document will be thoroughly checked for plagiarism and grammatical errors as we use highly authentic and licit sources.

Moneyback Guarantee

Still reluctant about placing an order? Our 100% Moneyback Guarantee backs you up on rare occasions where you aren’t satisfied with the writing.

Order Tracking

You don’t have to wait for an update for hours; you can track the progress of your order any time you want. We share the status after each step.


Areas of Expertise

Although you can leverage our expertise for any writing task, we have a knack for creating flawless papers for the following document types.

Areas of Expertise

Although you can leverage our expertise for any writing task, we have a knack for creating flawless papers for the following document types.


Trusted Partner of 9650+ Students for Writing

From brainstorming your paper's outline to perfecting its grammar, we perform every step carefully to make your paper worthy of A grade.

Preferred Writer

Hire your preferred writer anytime. Simply specify if you want your preferred expert to write your paper and we’ll make that happen.

Grammar Check Report

Get an elaborate and authentic grammar check report with your work to have the grammar goodness sealed in your document.

One Page Summary

You can purchase this feature if you want our writers to sum up your paper in the form of a concise and well-articulated summary.

Plagiarism Report

You don’t have to worry about plagiarism anymore. Get a plagiarism report to certify the uniqueness of your work.

Free Features $66FREE

  • Most Qualified Writer $10FREE
  • Plagiarism Scan Report $10FREE
  • Unlimited Revisions $08FREE
  • Paper Formatting $05FREE
  • Cover Page $05FREE
  • Referencing & Bibliography $10FREE
  • Dedicated User Area $08FREE
  • 24/7 Order Tracking $05FREE
  • Periodic Email Alerts $05FREE

Our Services

Join us for the best experience while seeking writing assistance in your college life. A good grade is all you need to boost up your academic excellence and we are all about it.

  • On-time Delivery
  • 24/7 Order Tracking
  • Access to Authentic Sources
Academic Writing

We create perfect papers according to the guidelines.

Professional Editing

We seamlessly edit out errors from your papers.

Thorough Proofreading

We thoroughly read your final draft to identify errors.


Delegate Your Challenging Writing Tasks to Experienced Professionals

Work with ultimate peace of mind because we ensure that your academic work is our responsibility and your grades are a top concern for us!

Check Out Our Sample Work

Dedication. Quality. Commitment. Punctuality

All samples
Article review
Thesis/Thesis chapter
Research paper
Article review
A Holistic Response to Crime Victimization
View this sample
Thesis/Thesis chapter
Post Covid-19 Economic Recovery
View this sample
Research paper
Final Case Analysis: Organizational Ethical Dilemmas
Undergrad. (yrs 3-4)
Business Studies
View this sample
Research paper
Communicable Disease
View this sample
Research paper
Mental health
View this sample

It May Not Be Much, but It’s Honest Work!

Here is what we have achieved so far. These numbers are evidence that we go the extra mile to make your college journey successful.


Happy Clients


Words Written This Week


Ongoing Orders


Customer Satisfaction Rate

Process as Fine as Brewed Coffee

We have the most intuitive and minimalistic process so that you can easily place an order. Just follow a few steps to unlock success.

See How We Helped 9000+ Students Achieve Success


We Analyze Your Problem and Offer Customized Writing

We understand your guidelines first before delivering any writing service. You can discuss your writing needs and we will have them evaluated by our dedicated team.

  • Clear elicitation of your requirements.
  • Customized writing as per your needs.

We Mirror Your Guidelines to Deliver Quality Services

We write your papers in a standardized way. We complete your work in such a way that it turns out to be a perfect description of your guidelines.

  • Proactive analysis of your writing.
  • Active communication to understand requirements.

We Handle Your Writing Tasks to Ensure Excellent Grades

We promise you excellent grades and academic excellence that you always longed for. Our writers stay in touch with you via email.

  • Thorough research and analysis for every order.
  • Deliverance of reliable writing service to improve your grades.
Place an Order Start Chat Now

error: Content is protected !!
Need assignment help? You can contact our live agent via WhatsApp using +1 718 717 2861

Feel free to ask questions, clarifications, or discounts available when placing an order.

Order your essay today and save 30% with the discount code UNRIVALED