Goldman Crony: Investors Didn't Do Homework

Paulson goes on offensive to reassure hedge fund members
By John Johnson,  Newser Staff
Posted Apr 20, 2010 7:32 PM CDT
Goldman Crony: Investors Didn't Do Homework
John Paulson testifies on Capitol Hill Thursday, Nov. 13, 2008.   (AP Photo/Kevin Wolf)

John Paulson—the hedge fund billionaire at the center of the deal that's brought misery on Goldman Sachs—has escaped criminal charges. But the Wall Street Journal reports that he's sweating at least a little to keep investors in his massive Paulson & Co. fund from jumping ship. He had a sometimes testy conference call last night with 100 investors and sent out a letter tonight to reassure everyone that the SEC inquiry won't affect him.

"Some of the callers asked pointed questions, almost like a court inquisition, but most people were supportive," an Atlanta investor tells the Journal. "I felt reassured that he did nothing wrong." Others were worried that Paulson could be ensnared by overseas regulators or that he will, at the very least, be distracted. Not so, says Paulson. As the Journal puts it: He "suggested to clients that the large investors who purchased the Goldman deal and others relied on rating firms, and didn't do enough of their homework."
(More John Paulson stories.)

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