The legal assault on Goldman Sachs is growing — just days after federal regulators accused Goldman of fraud, the Justice Department has launched a criminal investigation into whether Goldman employees duped investors who bought mortgage-backed securities from the firm. Now, the Wall Street powerhouse faces a difficult decision: Tarnish its reputation by admitting wrongdoing under a deal to avoid prosecution, or enter a potentially devastating legal battle by continuing to insist it did nothing wrong. What should Goldman do? (Watch a Fox report about Goldman Sachs' settlement pros and cons)
Settling is the only way to end the bleeding: "It's time for Goldman to reach for the checkbook," says Henry Blodget in Business Insider. It will be "galling and humiliating" for the bank to pay a $1 billion-plus fine when it insists it did nothing wrong. But the firm's nosediving stock price has already cost it $21 billion in market value, and the specter of criminal charges only makes matters worse.
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