In 2006 and 2007, Goldman Sachs Group peddled more than $40 billion in securities backed by at least 200,000 risky home mortgages, but never told the buyers that it also was secretly betting that a sharp drop in U.S. housing prices would send the value of those securities plummeting. A five-month McClatchy investigation has found that Goldman's failure to disclose those secret bets may have violated securities laws. » read more
In the absence of federal prosecutions over Wall Street's role in the nation's financial crisis, the Manhattan district attorney has subpoenaed Goldman Sachs regarding allegations that the giant investment bank bet heavily against its clients in risky mortgage deals, two people familiar with the matter said Thursday. » read more
A five-month McClatchy investigation reveals how Wall Street colossus Goldman Sachs peddled billions of dollars in shaky securities tied to subprime mortgages on unsuspecting pension funds, insurance companies and other investors when it concluded that the housing bubble would burst.
See our state-by-state breakdown of troubled mortgages. The rate of mortgage delinquencies has skyrocketed since 2004, when only 1 percent of traditional mortgages, known as prime, were 60 days in arrears and just 1.5 percent were in foreclosure.