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" The Justice Department's criminal investigation into Goldman Sachs goes beyond the financial transactions targeted by the Securities and Exchange Commission in the civil fraud suit brought against the firm last month, law enforcement sources said Friday.
The Justice Department probe began weeks ago and is essentially on a parallel track with the SEC investigation, the sources said. While prosecutors and investigators are focusing on some of the same mortgage-related transactions as the SEC, the sources said, the Justice Department has cast a wider net.
Investors pounded Goldman Sachs shares on Friday as it became increasingly clear that the Wall Street bank's problems are growing. After initial news media reports about the criminal investigation, investors sent Goldman shares down 9.4 percent, or $15.04, to $145.20.
It was another brutal day for a firm that survived the worst of the financial wreckage of the past two years. Since the SEC filed its suit April 16, Goldman's shares have lost 20 percent of their value, costing investors $20.6 billion in market value.
Other actions pending
But analysts said the criminal probe and the civil case are just two of several developments that could threaten Goldman's reputation and bottom line in coming months. The firm also was the subject of a searing Senate investigative report this week examining Goldman's role in the financial crisis. Goldman's bottom line could also suffer if the Senate, now debating reforms to financial regulation, adopts proposed changes to limit trading in derivatives and certain investment activities at banks, for instance owning hedge fund.
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<http://www.washingtonpost.com/wp-dyn/content/article/2010/04/30/AR2010043001336.html?hpid%3Dtopnews⊂=AR>
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