NEW YORK - The Manhattan District Attorney’s office hit Goldman Sachs with a subpoena on Thursday asking the company for more information about its activities during the credit crisis.
The Manhattan District Attorney Cyrus Vance Jr’s office is the highest law enforcement office in the city. The Attorney’s office is further investigating claims made by senate investigations about how the banking giant might have mislead investors and buyers leading up the financial crisis. In particular, the senate investigations singled out Goldman Sachs for encouraging investors to buy mortgage securities while the bank itself was taking positions against the mortgage market.
The official Senate investigation had been completed in April of this year, and the 639-page report concluded that Goldman Sachs had marketed four sets of mortgage securities to clients, while failing to tell them about the risk of the securities and secretly betting against the investments.
The subpoena itself is simply a request for information, and does not indicate any wrongdoing on part of Goldman Sachs. However, investors are worried about the results of the investigation. Shares of Goldman Sachs slipped two percent after news broke about the Goldman Sachs subpoena.
