Goldman Sachs Plans to Fight Back Against Senate Report

(Reuters)

Goldman Sachs Group Inc., trying to counter a Senate subcommittee report that is fueling investigations and suspicion of the firm, plans to accuse the subcommittee of drastically overstating Goldman's bets against the housing market in 2007, people familiar with the situation said.

The securities firm is considering releasing documents about its mortgage bets that are aimed at showing what Goldman officials claim is sloppy math and incomplete analysis by the Senate Permanent Subcommittee on Investigations as the panel sifted through tens of millions of documents turned over by Goldman.

The information might be released soon on Goldman's website, though a decision hasn't been made yet. Even if the documents aren't made public, they could be used by Goldman to defend itself in ongoing investigations that appear to be linked to the Senate subcommittee's report.

'The evidence shows that Goldman Sachs helped build and operate that conveyor belt that fed toxic mortgages and mortgage securities into the financial system and then made large bets against the market that it helped create-taking the big short, and reaping the profits from it.' -Sen. Carl Levin (D., Mich.)

A subcommittee spokeswoman declined to comment.

The subcommittee's 639-page report in April denounced Goldman as an unusually strong example of wrongdoing by financial firms during the crisis. According to the report, Goldman systematically sought to profit from a "big short" against the housing market and betrayed clients by putting the firm's own interests ahead of theirs.

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