Goldman's legal troubles are deepening. Federal prosecutors at the US Attorney's Office in Manhattan have opened a criminal probe into the Wall Street giant's mortgage trading, reports the Wall Street Journal. Prosecutors are looking for evidence of securities fraud but haven't decided whether to bring charges. The SEC, which has brought civil charges of its own, referred the case to the Manhattan office.
Prosecutors face huge hurdles in bringing a case, explains the Journal. For starters, they'd have the difficult task of proving that Goldman employees knowingly broke the law. Beyond that, the ins and outs of trades involving "collateralized debt obligations" are mind-numbingly complex.
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