Goldman may try to settle the SEC case it faces rather than endure an embarrassing court battle, a new report from the New York Post indicates. Earlier this week past and present Goldman executives endured an 11-hour witch trial-like hearing before a Senate committee where there was broad bi-partisan anger at the bank's actions leading up to the financial crisis. Goldman may feel that it's worth paying up instead of going through that sort of thing for weeks at trial. Still, given the bank's unwavering claim of innocence, a settlement would be a little surprising.
The New York Post reports:
"It's almost a certainty that there will be a settlement," said a source.
As another person put it, the SEC has an "unlimited supply of ammunition" in the form of e-mails and records that it could release, and Goldman officials would like to avoid having those documents fired back at them the way they were on Tuesday.
The problem with settling, of course, is that it means a defendant is implicitly admitting guilt. If there was anything clear through Goldman's marathon testimony on Tuesday, it was the bank's unflinching belief in its innocence. The only banker named in the suit, Fabrice Tourre, "categorically" denied that he did anything wrong. All the others testifying, including Goldman CEO Lloyd Blankfein, swore innocence as well. If they were planning on settling anyway, you might have expected at least a slightly more apologetic tone. Instead, they were brazen throughout the questioning.