Goldman Sachs agreed Monday to pay $5 billion to settle state and federal investigations into the investment bank's sale of residential mortgage-backed securities ahead of the 2008 financial crisis, the Justice Department said. The deal requires the bank to pay a $2.4 billion civil penalty and $1.8 billion to homeowners and other borrowers affected by the housing crisis. The other $875 million will go towards resolving claims by the New York and Illinois attorneys general, the National Credit Union Administration, and the Federal Home Loan Banks of Chicago and Seattle.
"This resolution holds Goldman Sachs accountable for its serious misconduct in falsely assuring investors that securities it sold were backed by sound mortgages, when it knew that they were full of mortgages that were likely to fail," Acting Associate Atty. Gen. Stuart Delery said in a statement. However, the deal does not include any criminal sanctions or penalties, nor does it hold any individual bank employees responsible.
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.
Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
-
How potatoes became an 'unusual bellwether' in Russia's economyUnder The Radarp Spud shortages are pointing to a wider crisis in the nation's finances
-
7 food trails worth zipping alongThe Week Recommends Take a bite out of the United States
-
Libraries are feeling the cost burden of e-book popularityUnder the Radar Certain states are working to change laws around e-book purchasing for libraries
-
Dollar faces historic slump as stocks hit new highSpeed Read While stocks have recovered post-Trump tariffs, the dollar has weakened more than 10% this year
-
Economists fear US inflation data less reliablespeed read The Labor Department is collecting less data for its consumer price index due to staffing shortages
-
Crypto firm Coinbase hacked, faces SEC scrutinySpeed Read The Securities and Exchange Commission has also been investigating whether Coinbase misstated its user numbers in past disclosures
-
Starbucks baristas strike over dress codespeed read The new uniform 'puts the burden on baristas' to buy new clothes, said a Starbucks Workers United union delegate
-
Warren Buffet announces surprise retirementspeed read At the annual meeting of Berkshire Hathaway, the billionaire investor named Vice Chairman Greg Abel his replacement
-
Trump calls Amazon's Bezos over tariff displaySpeed Read The president was not happy with reports that Amazon would list the added cost from tariffs alongside product prices
-
Markets notch worst quarter in years as new tariffs loomSpeed Read The S&P 500 is on track for its worst month since 2022 as investors brace for Trump's tariffs
-
Tesla Cybertrucks recalled over dislodging panelsSpeed Read Almost every Cybertruck in the US has been recalled over a stainless steel panel that could fall off
