Goldman Sachs: Senate 'Cherry-Picked' E-Mails to Make Us Look Bad

Goldman Sachs on Sunday accused a Senate panel of cherry-picking a handful of e-mails released the day before that appeared to show top executives at the firm boasting about the money it was making as the housing market collapsed. 

The company released its own e-mails to support its argument that it did not know where the market was going and did not get rich off the mortgage meltdown. Spokesman Lucas van Praag expressed concern that only select e-mails were released ahead of a Tuesday hearing where top executives are expected to testify. 

"The U.S. Senate subcommittee has cherry-picked just four e-mails from the almost 20 million pages of documents and e-mails provided to it by Goldman Sachs. It is concerning that the subcommittee seems to have reached its conclusion even before holding a hearing," van Praag said in a written statement. 

In one e-mail Goldman released, executive Fabrice Tourre said investment products like subprime mortgages were like "Frankenstein turning against his own inventor." 

Some lawmakers think Goldman deserves the chance to defend itself. 

"There are some conflicts of interest that can exist and do need to be looked at, but I'd rather wait and see how this investigation unfolds before making any judgments," Sen. Bob Corker, R-Tenn., said Sunday on ABC's "This Week." 

But others say the e-mails released by the Senate panel were just the latest sign that Goldman was profiting off others' misery while the economy was in turmoil. 

The documents suggest that Goldman benefited at least for a time from bets that subprime mortgage-backed securities would lose value. 

"Of course we didn't dodge the mortgage mess," CEO Lloyd Blankfein wrote in an e-mail dated Nov. 18, 2007, according to the documents released Saturday morning. "We lost money, then made more than we lost because of shorts." 

Short positions, in contrast to long positions, are bets that a financial security will lose value. 

The e-mails were released by Sen. Carl Levin's office, who is presiding over an investigation into the financial crisis. Blankfein is among the executives scheduled to testify Tuesday. 

In another e-mail, Goldman Chief Financial Officer David Viniar says that in one day the firm made more than $50 million on bets that the housing market would collapse, according to a statement from Levin's office. 

"Tells you what might be happening to people who don't have the big short," Viniar writes in the message dated July 25, 2007. Viniar is also scheduled to testify on Tuesday. 

Goldman is the target of a civil fraud lawsuit brought by the Securities and Exchange Commission, which alleges that the firm misled investors about how a subprime mortgage-backed security was created. Goldman has denied the charges. 

The Associated Press contributed to this report.