The statements from the Senators make it clear that they are not holding this hearing in order to find out what happened; that's the SEC's job. They're holding this hearing in order to be televised yelling at investment bankers. Claire McCaskill's rant was particularly irrelevant to the actual question at hand, but all of them are mostly trying to express outrage, not make any coherent assessment of the strengths of the SEC's case.
And what is the strength? It boils down to the question of what a material fact is. If you define a material fact as something that would have changed the actual performance of the security, then probably Goldman didn't fail in its duty. The garbage ACA picked on its own was allegedly no better than the garbage that Paulson chose. I'm not aware of any investors who were skilled enough to pick high-performing securities based on subprime mortgages.
And certainly, ACA's claimed motives seem more than a bit dim. They didn't know that Paulson was a housing bear? Or they thought he'd found the one set of securities he believed was going to outperform? Really? You know, I have a used car I could offload if you'll get the ACA guys down here to take a look at it . . .