logo
Share SHARE
FONT-SIZE Plus   Neg

Goldman Sachs To Pay $1.5 Mln For Supervision Failures

The U.S. Commodity Futures Trading Commission or CFTC announced that Goldman, Sachs & Co. (GS) would pay $1.5 million in civil monetary penalty to settle CFTC charges for failing to supervise a former trader, Matthew Marshall Taylor, in late 2007. The CFTC Order also requires Goldman to cease and desist from violating a CFTC regulation requiring diligent supervision.

Goldman failed to supervise diligently the trading activities of Taylor, whose trading activities on seven days in mid-November and mid-December 2007 in the e-mini S&P 500 futures contract.

CFTC filed an enforcement action in the Federal District Court against Taylor on November 8, charging Taylor with defrauding Goldman by intentionally concealing an $8.3 billion trading position in 2007. Goldman suffered a loss of over $118 million in unwinding Taylor's position, CFTC stated.

Goldman failed to have policies or procedures reasonably designed to detect and prevent the manual entry of fabricated futures trades into its front office systems.

CFTC Commissioner Bart Chilton said he thought Goldman's fine should have been at least $7.8 million. "I do not believe that the $1.5 million penalty is anywhere close to an amount representing a sufficient penalty or deterrent", Chilton stated. Fines should represent more than a "slap on the wrist" or a "cost of doing business", he added.

"Given the egregious nature of the failure to supervise adequately, combined with the high number of violative transactions, I believe that the monetary penalty should be significantly higher in order to represent a sufficient punishment, as well as to denote a meaningful deterrent to future illegal activity," Chilton said in a dissenting opinion.

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

Business News

Editors Pick
Google is planning to significantly expand a carpool service on its navigational app Waze, according to a report in the Wall Street Journal. The move indicates the company is edging closer to a potential clash with ride-hailing service Uber Technologies Inc. Private equity firm Sycamore Partners has won the bankruptcy auction for the e-commerce business and intellectual property of U.S. women's apparel retailer The Limited with a bid of $26.8 million, Reuters reported, citing people familiar with the matter. A U.S. bankruptcy court judge must now approve the sale to Sycamore Partners. French telecommunications operator Orange SA reported Thursday higher net profit in its fiscal year 2016 mainly on income from discontinued operations. Operating income, meanwhile, declined, despite increased revenues. For fiscal 2017, the company projects higher adjusted EBITDA, a key earnings metric.
comments powered by Disqus
Follow RTT