Goldman Sachs share price: Lender under investigation in currency probe

Alice Young
  • November 7th, 15:37
  • Last Updated: October 21st, 13:17

iNVEZZ.com, Thursday, November 7: Goldman Sachs Group Inc (NYSE:GS) today said that it was under investigation by regulators probing the potential manipulation of foreign-exchange rates. In addition, the bank also disclosed that US enquiries into the way it had packaged and sold mortgage bonds ahead of the financial crisis might result in a ‘significant increase’ in the company’s legal costs. Goldman Sachs’ share price has been little changed in early morning trading in New York today.

**Goldman Sachs under investigation**
In its quarterly filing with the US Securities and Exchange Commission, Goldman Sachs said that investigators were looking at the company’s “trading activities and communications in connection with the establishment of benchmark rates”. The bank noted that it was “cooperating with all such regulatory investigations and reviews”.

Trade these shares now through Hargreaves Lansdown from £5.95 per deal.
UK peers Barclays and Royal Bank of Scotland Group as well as UBS, Citigroup and JPMorgan have already noted that they are being investigated by authorities examining the $5.3 trillion-a-day foreign-exchange market and that they are cooperating with regulators on the investigations. Last week, Barclays suspended six traders as part of an internal probe related to the forex investigation conducted by the UK’s Financial Conduct Authority (FCA). (Barclays share price: Bank suspends six traders in forex probe).

The Financial Times quoted an unnamed source familiar with the matter as suggesting that Goldman Sachs’ cursory disclosure might reflect the bank having a lesser role in the investigation.

Goldman Sachs is also being probed over its commodities trading. As the FT has noted, metals users have accused the lender of pushing up the price of aluminium by the practices it uses in its warehouses.

‘Significant increase’ in legal liabilities
In the same filing, Goldman Sachs disclosed that the ongoing investigations by members of the Residential Mortgage-Backed Securities Working Group of the US Financial Fraud Enforcement Task Force could result in “a significant increase in the firm’s liabilities for mortgage-related matters”.
The Wall Street Journal noted that the working group of federal and state agencies was formed by President Obama in 2012 to probe banks’ sales of mortgage bonds ahead of the financial crisis.
**As of 14:52 UTC, buy Goldman Sachs shares at $163.55.**
**As of 14:52 UTC, sell Goldman Sachs shares at $163.50.**
Trade these shares now through Hargreaves Lansdown from £5.95 per deal.
Prices can go up and down meaning you can get back less than you invest. This is not advice. Dealing services provided by Hargreaves Lansdown.

About the author

Avatar
Alice Young
Alice joined the Invezz team after motherhood convinced her to make a career change from actuary-ing. She brings a forensic eye for detail developed through crunching numbers on underwriting satellite insurance and the like.

Leave a Reply

Investing is speculative. When investing your capital is at risk. This site is not intended for use in jurisdictions in which the trading or investments described are prohibited and should only be used by such persons and in such ways as are legally permitted. Your investment may not qualify for investor protection in your country or state of residence, so please conduct your own due diligence. This website is free for you to use but we may receive commission from the companies we feature on this site. Click here for more information.